On Thursday, the companies said the TLA decision, which was arrived at jointly, was beneficial for both as it would allow Jindal to focus on its Indonesia core business model – supplying high-quality coal to its Indian steel and power business.

CCTI, meanwhile, will be able to place its focus on the development and marketing of its technology to third parties.

The two initially signed a memorandum of understanding for the consideration of the JV on January 27.

Under the TLA, Jindal will give CCTI an ongoing royalty fee on all of its majority-owned mines’ processed coal in the region of the Association of Southeast Asian Nations.

Also, Jindal will pay a one-time license fee when the two sign a pilot plant construction contract with SAIC Energy Environment and Infrastructure and forward a deposit.

Jindal is currently reviewing the royalty fee amount and license fee and is expected to announce its approval in the near future.

CCTI has teamed with the Archean Group via a binding-term JV initiative for the ASEAN region that will develop, deploy and market CCTI’s Pristine M technology throughout the area.

The companies expect to balance ownership at 55% for AGPL and CCTI at 45%.

In exchange for its ownership interest, AGPL will provide the JV with $US4 million – $2 million of which will be used to fund the construction of a 1:10-scale pilot plant in Oklahoma.

The balance, a one-time license fee, will be given to CCTI when the pilot facility is commissioned.

Construction is expected to begin as soon as the contract is sealed and the JV’s down payment to SAIC is made.

The contract should be formalized this month and the facility construction, which will take 16-24 weeks, could begin in April.

AGPL will pay a $1 per ton ongoing royalty fee for all coal processed from its majority-owned mines and no royalties will be paid on the initial two million tons of coal production.

CCTI, for its interest, will contribute a 25-year exclusive license to develop, market and deploy its Pristine M technology that will encompass the ASEAN countries of Indonesia, the Philippines, Cambodia, Vietnam, Malaysia, Brunei, Thailand, Laos and Myanmar.

AGPL will also acquire a 6.7% stake in CCTI for $2 million.

“We are delighted to have signed this agreement with AGPL and agreed to restructure our transaction with Jindal,” CCTI chief executive Robin Eves said.

“The result is that CCTI will have a larger stake in the ASEAN region joint venture, two commercial projects in Indonesia immediately to follow the successful deployment of the pilot plant, two royalty-paying clients and license fees totaling $2.75 million, up from $US1.5 million, prior to the AGPL transaction.”

Eves added that the deal with AGPL would also provide it with working capital to reduce its debt.

“The Archean Group has an enormous marketing footprint in Asia, the Middle East and Africa,” he said.

Currently, AGPL owns an estimated 800Mt of coal reserves in Indonesia – 2.5 million tons per annum is being exported to China while 1.5Mtpa is going to India.

“Plans are in place to ramp up Indonesian production and exports to 10Mtpa by 2013,” Eves said.

“Their global trading and marketing network will be invaluable for introducing CCTI's Pristine M technology around the world.”