* Rio's second coal deal this week
* One Australian asset left to sell
* Whitehaven says purchase will help meet Asian demand (Adds comment, background, share prices)
By Ambar Warrick and Barbara Lewis
BENGALURU/LONDON, March 22 (Reuters) - Rio Tinto is to sell its 75 percent stake in a Queensland project to Australia's Whitehaven Coal for $200 million, in its second deal this week to shed coal assets.
Rio is also in the process of selling its remaining Australian coal asset - a stake in the Kestrel underground mine.
"We believe this agreement for the sale of Winchester South represents the best option for the future development of the project while delivering attractive value for Rio Tinto," Rio Tinto CEO Jean-Sebastien Jacques said in a statement.
The deal, subject to Australian regulatory approvals, is broken down into $150 million payable to Rio Tinto by Whitehaven on the date of completion and a further unconditional payment of $50 million payable a year later.
Whitehaven Coal said it would fund the purchase with cash and existing facilities and it was expected to conclude in the second quarter.
Retail property manager Scentre Group has the remaining 25 percent stake in Winchester South.
Once developed, Winchester South is expected to produce coking and thermal coal.
Whitehaven Coal Managing Director and CEO Paul Flynn said the project was "a significant strategic acquisition," which complemented existing assets and tallied with a longer term plan to meet Asian demand for premium quality coking coal.
Glencore, the world's biggest shipper of export grade coal, has also said it expects to continue to find value in high quality coal.
Rio Tinto on Tuesday announced it had agreed to sell to Glencore the Hail Creek coal mine and Valeria coal project in Australia for $1.7 billion.
Sven Reinke, Senior Vice President, and Anke Richter, Associate Managing Director at Moody's, said in an emailed statement on Thursday Glencore's purchase was "credit positive".
"The proximity to Glencore's existing operations and the existing infrastructure offers material potential to realise synergies and could result in a short pay back period of around 5 years," he said.
Some investors shun the fuel because of concerns about climate change and because more environmental alternatives are becoming more competitive.
Coal miners' profits have this year been boosted by a coal price rally.
Those bullish about coal say falls in investment have tightened the market, increasing the value of a commodity still favoured in parts of the world as a cheap, easy source of power.
Whitehaven Coal posted a 63 percent rise in first-half net profit, while Glencore and the other majors have rallied strongly from the deep commodity markets crash of 2015-16.
Rio Tinto's share price was trading 1.9 percent lower by 1155 GMT in London trade, slightly underperforming the broader index. Whitehaven closed down 1.5 percent in Australia.
"Rio is cleaning up the portfolio and generating some pretty decent cashflow in the process," analyst Paul Gait of Bernstein said. (Editing by Sherry Jacob-Phillips, Subhranshu Sahu and Jane Merriman)