Coalworks Pty Ltd, a wholly owned subsidiary of Coalworks Limited, has signed MoU with ITOCHU Minerals & Energy of Australia Pty Ltd to develop its coal project in the booming Gunnedah Basin of NSW in a deal worth USD 11million.

ITOCHU Corporation 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 had annual revenue of USD 34, 807 billion and NET income of USD 1,684 billion in the fiscal year ended March 2009.

It has numerous coal mines in Australia which includes joint ventures with Xstrata Gloucester Coal and Anglo Coal. Up to USD 11 million will be spent by IMEA at Vickery South, where a drilling program has already commenced, to undertake a preliminary feasibility study and complete a bankable feasibility study by mid next year.

In a proposed JV the MoU provides for ITOCHU to enter into a marketing and sales agreement and off take agreement whereby ITOCHU will buy or arrange the sale and marketing of all coking and thermal coal produced from Vickery South.

Mr Dr Andrew Firek Chemical engineer and Managing Director of Coalworks said the benefit of having ITOCHU as a joint venture partner can’t be overestimated. He said that “ITOCHU experiences in coal mining development, coal off take and international marketing make it an invaluable partner.”