The $C40 million deal gives Xstrata 100% undivided interests in the licenses for the property located in northeastern British Columbia and covering about 3800 hectares.

“The company is pleased to have completed the sale of the Lossan property as it represents another significant step in solidifying our financial position and streamlining our asset base such that we can focus and concentrate our efforts on the development and expansion of the company’s New Elk metallurgical coal mine,” Cline president and chief executive officer Ken Bates said.

Xstrata said earlier this month that Lossan, which it acquired for nearly 30% below its estimated value in 2006, is surrounded by a group of licenses it acquired from First Coal in early August.

The project hosts 240 million tonnes of resources with 186Mt in the measured and indicated categories, with these figures based on the Canadian standard NI 43-101 as opposed to the often-used JORC code.

The Lossan acquisition has given Xstrata almost 100,000 hectares of total tenure in the Peace River coalfield.

In 2006, Cline had a $57 million capital expenditure estimate on the Lossan project.

At that time, Cline was aiming to produce 250,000 tonnes per annum of pulverised coal injection coal and other metallurgical coal for export, while it also flagged a ramp-up option to 1Mt per annum.