Under the agreement, ICRA Vickery will conduct a preliminary feasibility study at Coalworks’ Vickery South coal project – where a drilling program has already commenced – and complete a bankable feasibility study by mid-2011.
Since Coalworks signed a memorandum of understanding with Itochu in February this year, it has announced a maiden resource of 42 million tonnes of export-quality thermal coal with coking coal potential at Vickery South, which the company believes will be mined by open cut methods.
The MoU provides for Itochu to enter into a marketing and sales agreement and offtake option agreement whereby it will arrange the sale and marketing of all, and have the option to buy, coking and thermal coal produced from Vickery South.
Coalworks managing director Dr Andrew Firek said the benefit of having ICRA Vickery as a joint venture partner was of “inestimable value”
“Now that we have established a 42 million tonnes resource we are in a better position to draw on the strength of Itochu and ICRA Vickery, which will bring us closer to bankable feasibility study,” he said.
Itochu is a major Japanese trading house which has extensive experience in the development of coal mines and the global marketing and sale of coal.
It has numerous joint ventures and investments in coal mines in Australia, including joint ventures with Xstrata, Yancoal Australia and Anglo American Metallurgical.
Coalworks’ share price was up 1.5c this morning to 48.5c.
