Brisbane, July 18, 2008 AEST (ABN Newswire) - Diversified carbon-based energy company New Hope Corporation Limited (ASX:NHC)(PINK:NHPEF) has entered into an agreement to sell its New Saraji Coal Project to BHP Billiton Mitsubishi Alliance (BMA) for A$2.45 billion cash.
New Hope has identified more than 690 million tonnes of coali at New Saraji (534 million tonnes inferred and 156 million tonnes indicated) which is near the town of Dysart in central Queensland.
New Hope Chairman Robert Millner said the sale would assist New Hope in expanding its New Acland mine situated outside Toowoomba, and further development of New Hope's Queensland Bulk Handling port facility in Brisbane.
"This sale realises substantial value for the New Saraji project, which is a world-class asset," he said.
"The sale highlights the hard work and expertise of our exploration, development and management team.
"The cash price will allow New Hope to continue the growth of our New Acland mine, which has continued to increase production to more than four million tonnes a year and for which we have made an application to increase production to 10 million tonnes a year. The funds will also underwrite our successful exploration efforts in our extensive exploration tenements.
"We are planning significant improvements to the mine, including increasing the rail capacity from the mine. Our long-term agreement with the Toowoomba Regional Council to supply the mine with recycled water, drought-proofs the mine and makes further expansion much easier.
"The transaction will also allow us to consider the development of our other Central Queensland projects, including Lenton.
"We will also be able to continue the expansion of our wholly owned QBH port facility, which is essentially a demurrage-free facility, to more than seven million tonnes a year from 2010.
"Our development of coal-to-liquid technologies is expected to receive a boost from this transaction.
"The board will also be considering appropriate capital management options." The transaction is expected to complete by October 2008, subject to Foreign Investment Review Board and other regulatory approvals and customary sale conditions. There is no financing condition.
New Saraji Coal Project
The New Saraji Coal Project is a significant resource adjacent to the Saraji Mine operated by the BHP Billiton Mitsubishi Alliance. A total resource of 690 million tonnes has been identified to date. The coal seams are within the Moranbah Coal Measures and include two seams, the Upper Harrow Creek and Main Dysart seams, which are suitable for high productivity longwall extraction. Other seams are present with sufficient quality and thickness to be considered for underground mining.
New Hope Corporation
New Hope is a carbon energy company listed on the ASX. Based in south-east Queensland, New Hope operates open-cut coal mines at Acland on the Darling Downs and at Rosewood, near Ipswich. New Hope holds exploration tenements in central and southern Queensland, owns land development projects and owns and operates port infrastructure assets. New Hope also holds a 17.7 per cent interest in Arrow Energy, an international coal-seam gas company based in Queensland.
BHP Billiton Mitsubishi Alliance
BMA is Australia's largest coal miner and exporter, and the world's largest supplier to the seaborne coking coal market. BMA was formed in June 2001 as a partnership between BHP Billiton and Mitsubishi Development Pty Ltd, under which the two companies share equal ownership and management of seven Central Queensland coal mines - Goonyella Riverside, Broadmeadow, Peak Downs, Saraji, Norwich Park, Gregory Crinum and Blackwater - and the Hay Point coal export terminal near Mackay.
Note:
The information in this announcement that refers to coal resources is based on information compiled by Mr Chris Creagh, a fulltime employee of New Hope. Mr Creagh is a member of the Australian Institute of Mining and Metallurgy and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which is undertaken, to qualify as a Competent Person as defined in the 2004 edition of the Australasian Code for Reporting Mineral Resources and Ore Reserves. Mr Creagh has consented to the inclusion in this announcement of the matters based on his information in the form and context in which it appears.
Contact
Investors
Robert Millner, Chairman, New Hope
MOB: +61-408-414-295
Media
Matthew Horan
MOB: +61-403-934-958
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