The deal was made with Newcastle-based Custom Mining (Middlemount), which secured the Middlemount tenement from Sennen Resources late last year.

In developing the mine Custom Mining will create 100 jobs in the Middlemount area.

Sedgman managing director Peter Hay said the Middlemount contracts were awarded to Sedgman without a tender process.

“The planned 400 tonne per hour CHPP will process up to 2.9 million tonnes per annum of coking and thermal coal,” Hay said.

“The 10-year operations contract increases Sedgman’s annual tonnage under contract and will bring the number of CHPPs which Sedgman operates to five.”

Sedgman said the CHPP operations contract will deliver recurring income streams over a 10-year period, commencing in the 2009 financial year, following the commissioning of the CHPP in 2008.

Custom Mining managing director Nathan Tinkler said the budding producer chose Sedgman because of its ability to add value to the project through in-house skills in the design, construction and operation of CHPPs.