The sale, worth $A1.7 million, is conditional upon Australian Foreign Investment Review Board approval, Chinese government regulatory approval and Queensland government approval of the permit transfers within five months.

Cokal executive chairman Peter Lynch said the sale would enable Cokal to focus on development of its Indonesian assets, particularly its Bumi Barito Mineral project.

“The planned sale to XMC will support the rapid development of these assets as XMC wishes to develop a strong business base in Queensland,” he said.

“While Cokal will have no ongoing financial interest in the tenements, we will work with XMC to support the development of the assets and their establishment in Australia.

XMC is one of China’s largest state-owned enterprises.

XMC employs 65,000 people and has a history dating back 120 years. In 2009, its annual production was 19.5 million tonnes.

Cokal has interests in four projects in central Kalimantan, Indonesia, which are considered prospective for metallurgical coal.

Cokal has signed a joint venture with Tanzoz Resource Company to explore for coal in Tanzania and has a cooperation agreement with the Mozambique Government Mining Corporation to explore for coking coal in Mozambique.