White Energy to merge its SE Asian business with US firm

ASX-listed firm White Energy Company Limited (WEC) said on Thursday that it has signed a binding letter of intent with US-listed firm Asia Special Situation Acquisition Corp. (ASSAC) whereby WEC agrees to merge its South East Asian business into ASSAC.

ASSAC will maintain its public listing on the American Stock Exchange but will change its name to White Energy South East Asia Corporation (WESEAC). If the merger is realized, WESAC will have cash reserves of US$110 million, WEC said in statement.

The cash reserves will be used to expand WESEAC?s operations, support existing joint ventures, and otherwise for general working capital purposes, it said.

WEC will own 56% and ASSAC?s existing shareholders will own 44% of the merged entity.

WESEAC?s assets will include the exclusive rights to utilize WEC?s unique patent-protected coal upgrading technology, which generates a more energy efficient, cleaner burning coal, in the key Asian markets of Indonesia (where it already has operations through its wholly owned subsidiary, BCBC Singapore Pte Ltd), Singapore, Malaysia, Vietnam and the Philippines.

Ownership of WEC?s 51% share of two joint ventures in Indonesia, both with internationally respected companies, Bayan Resource Group and with Adaro Group and Itochu Corporation.

The two joint ventures are the Tabang Coal Upgrade project (PT Kaltim Supacoal) in partnership with Bayan is scheduled to have an initial capacity to upgrade 1 Million Tons Per Annum (MTPA) of low grade coal to higher grade and more valuable coal in Q1 2009 with the objective of having total production of 5 MTPA by 2011.

The Adaro Coal Upgrade Project is scheduled for an initial capacity of 1 MTPA and is projected to increase capacity to 5 MTPA by 2012 and eventually to 8 MTPA. (denny)