The IPO covered the issue of 225 million new shares and the sale of 45 million vendor shares at 26c each.

Blackgold operates the Caotung and Heiwan underground thermal coal mines in Chongqing province in southwest central China.

The mines collective produced 0.73 million tonnes of product coal in 2010 and Blackgold plans to ramp up to 1Mt this calendar year then hit 1.2Mt in 2012.

The coal is mainly sold to domestic power generators in the Shanghai region.

Blackgold chairman James Tong said the company chose to list in Australia because of its strong reputation in the mining sector.

“We hope that the success of Blackgold paves the way for many other Chinese companies to see the ASX as the preferred option for listing,” he said.

Private company Lucky Magic Enterprises, controlled by Blackgold chief executive officer Yu Guo Peng, will hold 60.5% of Blackgold after the listing.

“Proceeds from the issue will be predominantly applied to modernising and improving logistics and handling methods at the existing mines as well as funding new acquisitions,” Yu said.

“Blackgold is an extremely efficient coal producer recovering an average of 87% of its underground resources.

“By introducing new equipment and more modern mining methods we hope to drive production costs lower while continuing to expand production.”

Blackgold also plans to make a secondary listing in Hong Kong after establishing itself with Australian mining investors.

The company will list with the Australian Securities Exchange code BGG.