PERTH (miningweekly.com) – ASX-listed explorer Cockatoo Coal has entered into an exclusivity agreement with trading and investment firm Mitsui & Co regarding the possible acquisition of an interest in some of Cockatoo’s Surat basin assets, in Queensland.
Cockatoo on Friday reported that it had agreed to give Mitsui an exclusive right, subject only to existing negotiations, to complete a due-diligence study and investigation into a possible transaction by March 2011.
In July, Cockatoo, as part of a consortium, entered into various conditional agreements with Anglo American to acquire five coal development assets for a total consideration of A$580-million.
Three of these assets fall within the Surat basin, and Cockatoo said on Friday that following the completion of the acquisition, Mitsui would hold a 49% stake in the Collingwood and Taroom projects, in which Cockatoo would have a 51% stake.
Cockatoo further has a 100% interest in around 3 900 km2 of coal-bearing tenements in the Surat basin.
Company director Peter Nightingale explained that the exclusivity agreement with Mitsui was to facilitate the study of a proposed equalisation of interest between the two companies in the Surat basin tenements, which, if achieved, would provide a stronger joint-venture relationship. It would also enhance the development of these tenements and the infrastructure required to deliver and export coal through the port of Gladstone.
The Surat basin projects, excluding Collingwood and Taroom, currently have a Joint Ore Reserves Committee-compliant reserve of 64,3-million tons as defined in the Woori project.
A further inferred resource of 331,5-million tons at the Tin Hut Creek, Bottle Tree, Davies Road and Krugers project areas also provided substantial upside potential.