The Red Mountain joint venture (RMJV) involved Millennium transferring a 50% interest in its access road, power, coal preparation, coal handling and rail infrastructure to BMC upon commissioning of the facilities in late 2005.

Design capacity of the infrastructure, currently under construction, will be upgraded to six million tonnes per annum. The partners will take half shares of capacity, with RMJV being owned equally by the two companies.

On completion Excel will transfer a 50% interest in the asset to BMC in exchange for certain coal tenements. Millennium’s total funding commitment to the project will total $103 million.

BMC will earn its interest in the joint venture by transferring three coal tenements to Millennium and the company will be given the opportunity to obtain BMC mining leases adjoining its existing tenement.

Together the tenements contain 44Mt of measured and indicated opencut coal resources, 22Mt of indicated opencut resources, and significant inferred resources at depth that have not been adequately explored or quantified.

The integration of BMC tenements will give Millennium more than 7,000 hectares containing measured and indicated opencut coal resources of 100Mt.

Excel said the tenements will improve Millennium’s overburden stripping ratio and will support its plan to produce 3Mtpa from opencut operations for more than 20 years.

Shares in Excel rose 7.43% to close at $7.52 yesterday.