Korean Government owned corporation Korean Resource Corporation (Kores) has entered into an agreement with Felix to buy the 4% stake for a total of $7 million plus 4% of the net assets.

Along with the recent sale of a 49% stake in the company’s Yarrabee mine, this deal will leave Felix with zero net debt and majority interest and operational control over three cash producing opencut mines and the Ashton longwall project will ramp up in March 2007.

Felix managing director Brian Flannery said it was in the best interest of shareholders to sell the stakes in Minerva and Yarrabee so as not to have to issue more equity in order to develop Moolarben.

“This will see Felix in a very robust position from which to develop the Moolarben project in New South Wales,” Flannery said.

Awaiting NSW government approval, Moolarben is planned to commence construction by mid-2007 with its first production in the second half of 2008.

Minerva is an operating mine located 40km south of Emerald in Central Queensland producing 2.5 million tonnes per annum of high quality thermal coal, sold mainly to customers in Korea and Japan.

Athena is the adjacent exploration area which currently has approximately 560Mt of inferred underground resources.

Both projects are joint venture operations, with Japanese trading company Sojitz holding 45% equity in each project.

This sale will bring Felix’s equity interest in both projects to 51% while maintaining management of both the projects.

Flannery said the company and Sojitz were pleased to have Kores involved in the mine as Korea is becoming an increasingly important customer for Australian thermal coal.

Flannery said the Korean power utilities, also government owned, plan to increase their annual intake of thermal coal from around 50Mt to 70Mt over the next few years.