Under the agreement Metallica will divest its subsidiary SE QLD Energy, which holds Kingaroy, in consideration for a share placement of 30 million shares at 20c each, along with 30 million options exercisable at 20c before mid 2009.
Internickel will conduct due diligence on the project and also needs shareholder approval before going ahead with the deal.
Internickel attempted an ASX listing, looking for $2.5 million, but the offer was pulled in June. It now intends to list on the ASX following a name change to Intercoal on the back of the Kingaroy project in the first half of 2005.
Metallica said the value of the Kingaroy project might have been lost in its multi-commodity portfolio. It will now focus on its NORNICO and Lucky Break nickel projects.
The Kingaroy project contains a thermal coal resource of 181 million tonnes of which at least 20Mt is amenable to open pit mining with attractive margins, according to Metallica.
