Green Power Resources and APCS have signed a deed for the forward supply of the brown coal pellets, with the first shipment of 50,000t scheduled on or before November 2007.
The deed forms the basis of a formal agreement, which should be finalised in the coming weeks.
GPR has agreed to pay APCS the published daily Newcastle Coal Spot Price for the Coldry pellets within three months of confirmed shipment.
APCS will process brown coal into export Coldry pellets at its production facility in Bacchus Marsh.
Under the agreement, if APCS is able to produce more than 3Mtpa Coldry pellets, GPR will have first option on buying the extra tonnage under the same terms.
APCS said the Coldry process turns Victoria’s abundant high-moisture lignites (brown coal) into stable, low moisture, transportable pellets, suitable for use in coal-to-oil or coal-to-hydrogen projects.
When used in energy production, the Coldry pellets are said to reduce carbon emissions by up to 30%, compared with typical brown coal fuels.
APCS is currently the target for an uncontested acquisition by Perth biowaste-to-energy company, Environmental Solutions International [see related story].
ESI said the international supply agreement with GPR highlighted the strength of the Coldry technology, which it plans to incorporate into its biowaste-to-oil offering, Enersludge.
ESI said subject to completion of the APCS acquisition, it will continue to explore commercial opportunities for dewatering brown coal, sludge and other materials.