Under the deal, coal will be supplied from the Rotowaro mine and East mine to New Zealand Steel over five years.

Solid chief executive Barry Bragg said once land and mineral access was secured the company would spend $NZ100 million developing and extending the East mine over five years.

“The major expenditure will be the construction of a mine ventilation shaft and the provision of mining equipment such as continuous miners, shuttle cars and conveyors,” Bragg said.

“Securing the contract helps retain local jobs and allows Solid Energy to complete feasibility studies on new mines which would provide long-term secure coal supply to New Zealand Steel.”

Solid has already gained resource consents from the Waikato District Council and Environment Waikato to extend the Huntly East mine to the north.

The mine extension is expected to add 10 to 15 years to its life and increase local employment from 145 to around 200 people.

Solid Energy said it currently contributed about $115 million to the North Waikato economy through sales, employment and contracts with suppliers.