Under the MoU, Incitec will subscribe for 55 million shares in Metex at 20c per share. The MoU also provides for a joint venture company to be established upon completion of the planned UCG trial for the demonstration of commercial-scale syngas.
Incitec will hold a minimum 10.5% stake in Metex and will be granted exclusive global rights to the use of Metex's UCG technology to produce syngas for ammonia and ammonia derived products.
Metex's $20 million UCG trial will target a 100 million tonne JORC-compliant inferred resource identified at Bloodwood Creek in the Surat Basin, South East Queensland.
Approvals for the commercial-scale oxygen-injected trial were granted on April 8, 2008.
Metex said sufficient coal would be quarantined for a minimum 30-year life for any ammonia plant and related facilities which are constructed.
The plant is expected to be commissioned during the third quarter of 2008.
