Chiefly a gold and base metals explorer, Carpentaria’s wholly owned FTB subsidiary holds the project, which will be vended into a new company being formed by ResCo subsidiary, ResCo Projects.

The completed transaction will see Carpentaria receive 20% of the new company and a “cash sum” to cover past exploration expenditure, with the amount not revealed.

The new company will be funded by ResCo to advance the project to a bankable feasibility study.

Once the BFS is complete, Carpentaria said it would have the opportunity to take on 20% of the expense to start mining or to dilute its interest.

The new 80% ResCo-owned company will also fund any exploration and development work in other areas of the Hughenden coal project portfolio.

Carpentaria said both parties had agreed to an exclusivity period of not more than 60 days for the transaction, with due diligence and finalisation of the contractual documentation yet to take place.

“The directors of Carpentaria consider this to be a positive outcome for Carpentaria shareholders, as it not only reimburses Carpentaria for previous outlays on the project, but also increases Carpentaria’s exposure to additional coal properties in the process of being secured by ResCo Projects,” Carpentaria said.

“Further, Carpentaria will not be required to fund any additional expenditure on the Hughenden project or other projects until the risk has been diminished by the completion of feasibility studies.”

Waratah Coal and Hancock Prospecting are leading the charge to develop the untapped Galilee Basin.

Waratah’s China First thermal coal project will export 40 million tonnes per annum with first production to start in 2013.

Hancock has two projects, Alpha and Kevin’s Corner, each aiming for 30Mtpa, with Alpha targeting first exports in 2013.

Shares in Carpentaria are up A1c to 14.5c this morning.