(EnergyAsia, April 9 2012, Monday) — Australia’s 
Aquila Resources Limited said its wholly owned subsidiaries, Argos (QLD) Pty Ltd and Aquila Coal Pty Ltd, have agreed with Sumisho Coal Australia Pty Limited, a wholly owned subsidiary of Japan’s Sumitomo Corporation, to form a joint venture to explore Aquila’s significant portfolio of coal exploration permits in Queensland state.

Last month, the two sides signed a binding Memorandum of Understanding (MOU) which provides for Sumitomo to acquire between a 20% to 50% interest in the permits based on a valuation determined by an independent expert to be agreed by the parties. Aquila said the agreement excludes its Washpool hard coking coal project and Talwood coal project.

Aquila said it will manage the proposed joint venture with the aim of identifying and developing commercially mineable coal resources.

Since venturing into Australia in 1961, Sumitomo has built up a diverse portfolio of investments including the import and export of commodities in mining and industrial markets. The Tokyo-based trader holds stakes in joint ventures that own and operate thermal and metallurgical coal mines in the Bowen Basin area of Queensland.

Since it began exploring for coal in Australia in 2003, Aquila has started up a producing thermal and coking coal mine at Isaac Plains as well as found two very large tier 1 hard coking coal deposits at Eagle Downs and Belvedere, one medium sized open pit hard coking coal deposit at Washpool, and one large thermal and coking coal underground deposit at Talwood.

Aquila said the joint venture will benefit from the combination of Sumitomo’s financial strength and experience in producing coal joint ventures with its high quality exploration portfolio and strong management team.