Aussie?s OGL signs coal offtake deal with Chinese firm

Australia-listed firm Overseas & General Limited announced on Friday that the company has entered into a Memorandum of Understanding (MOU) with Chinese entity Zhejiang Materials Industry Fuel Group Co. Ltd as a preliminary step towards the determination of a supply contract for OGL?s Rahmat coal.

The Rahmat coal project, located near Samboja in East Kalimantan , is planned to commence mining operations in July 2010 at 50,000 tons per month. Rahmat coal has medium energy with low ash and sulphur, which meets Zhejiang coal requirements.

OGL Managing Director, David Mason stated that the MOU is a significant step in securing an off-take arrangement at a very early stage in Rahmat?s development, and gives OGL considerable certainty in the potential of the property. David is most confident a formal Supply Contract will be forthcoming in the near future and that it demonstrates a clear indication the coal quality from Rahmat meets demand from the Chinese market. (kanti)