The non-binding agreement provides the framework for further discussions with the Korean utility which aims to secure a long-term supply of thermal coal from the southern Bowen Basin project.
The HoA was first reported in Korean media on Friday but Bandanna managing director Michael Gray said it was also progressing talks with other potential coal customers and investors.
“As demand for thermal coal for power generation in Asia is predicted to more than double within the next decade, stable import of quality thermal coal has become a key long-term imperative for Asian power generators,” he said.
“Bandanna Energy’s Springsure Creek project is uniquely placed amongst Australian greenfield thermal coal projects to deliver stable long-term supply of high quality coal due to its resource size, location, contracted infrastructure, advanced approvals process and competitive capital and operating cost structure.”
The explorer is expecting to receive all regulatory approvals to start construction of its Springsure Creek project in the September quarter of 2014.
First development coal is forecast for mid-2015.
The project will export through the Wiggins Island coal export terminal, which is expected to start shipping in April 2015.
The thermal coal project is initially targeting 5.5 million tonnes per annum of capacity.
First longwall coal is expected in the second half of 2016.
If the expansion to double output goes ahead, first coal from the second longwall is expected in 2020.