TORONTO (miningweekly.com) – Toronto- and Frankfurt-quoted Saturn Minerals has signed a memorandum of understanding with an unnamed consortium to potentially supply feed to a planned coal-to-liquids plant in Saskatchewan, the company said on Wednesday.

The companies will carry out due diligence on each other’s assets, and Saturn will have the right to supply a minimum seven-million tons yearly of coal to the plant for at least 25 years if the partners ink a supply agreement, the Vancouver-based firm said.

Saturn added that the unnamed coal partner had been searching Canada’s coal assets since 2009 and had found the company to be suitable to its business model.

The partner was comprised of “internationally recognised entities with respect to coal and energy development, and senior oil and gas and financial interests that have previously secured financing for such ventures”, Saturn said.

The company added a nondisclosure agreement prevented it from naming the partner until after the due diligence period “for competitive reasons”.

South Africa’s Sasol is the biggest maker of liquid fuels from coal globally.

Saturn’s shares gained 12% by 13:45 to C$0.23 apiece, valuing the company at C$17.5-million.

The company owns coal properties in Saskatchewan and western Manitoba.

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