In conjunction with the CSIRO, White Energy subsidiary Binderless Coal Briquetting has developed a process which reduces the moisture content of low-value coals while significantly upgrading the energy content.

Australian Industry Minister Ian Macfarlane said the $4.3 million grant would help fast-track the building of a new and enhanced demonstration plant and meet the rapidly growing demand from coal producers and power companies to test the process.

Earlier this month BHP Billiton agreed to provide White Energy with a $US35 million, seven-year unsecured convertible funding facility to help accelerate the technology, and is now White Energy's exclusive global marketing agent.

“This innovative briquette technology will provide significant environmental benefits, emitting fewer CO2 gases than the low-grade coal that it is derived from,” Macfarlane said.

White Energy managing director John Atkinson said the grant demonstrates the Government’s focus on cleaner coal technologies as a key platform of future energy policy.

White Energy currently has joint ventures with Indonesian coal miner PT Bayan Resources; one of Indonesia’s largest coal companies, the Adaro Group; and major Japanese trading house Itochu Corporation. The focus of the JVs is to build coal upgrading plants in Indonesia.

The company is also working with Datang International Power Generation Company in relation to the development of coal upgrading plants on Datang’s coal deposits in China.