MetroCoal Limited has signed a Joint Venture Agreement (JVA) with China Coal Import & Export Company (CCIEC), covering the Columboola coal tenement in Queensland’s Surat Basin.
Under the terms of the agreement, CCIEC, a wholly-owned subsidiary of China National Coal Group, has acquired a 51% interest in Columboola for an agreed expenditure commitment of Aus$30 million.
The funds will be used for exploring and evaluating the potential for future commercialization options within the Columboola tenement and also opens up the opportunity for participation in MetroCoal’s other tenements.
The Columboola JVA requires a minimum expenditure of $4 million within the first two years of the agreement.
MetroCoal’s chairman David Barwick says, “Bringing CCIEC in as a joint venture partner is a significant milestone for the company, meeting its stated strategic objective of developing projects with substantial partners as well as complementing its overall strategy to confirm its exploration target of between 2.5 and 3.5 billion tonnes.”
MetroCoal’s CEO Mike O’Brien says, “China Coal is a substantial company producing in excess of 100 million tonnes of coal a year. With access to this strong mining base, CCIEC will bring valuable technical skill and expertise into the joint venture, particularly in underground coal mining.
“Discussions have been ongoing for some time and during this period we have developed a good relationship with CCIEC executives that will provide a constructive base for our future relationship.
“In terms of the work program, the Columboola JVA will continue the initial exploration activities and subject to the success of this program, advance the development plans to exploit significant underground coal assets.”
MetroCoal holds extensive coal tenements covering about 4000sqkm throughout the Surat Basin which it plans to commercialize through conventional coal mining and underground coal gasification (UCG).