Bishkek (AKIpress) – Без имени Australian listed coal company TerraCom Limited, through its Mongolian subsidiary, has executed binding long form definitive agreements with a wholly owned subsidiary of the Kingho Group, one of the largest private coal companies in China, for a 5.5-year offtake of hard coking coal produced from the Baruun Noyon Uul Coal Mine in the South Gobi in Mongolia, reported Herald Sun.

The agreement is for a total of approximately 7.5 million tons over the term and has pricing linked to a commercially in confidence mine gate pricing structure that reflects the seaborne market. Payment terms are USD in the form of 100% Irrevocable Letter of Credit issued by a first class international bank. The Kingho Group will primarily use the BNU coal for their internal consumption at their coke plants.

TerraCom has fully commissioned the Baruun Noyon Uul coking coal mine in the South Gobi Mongolia and is focused on becoming become one of the largest and highest quality coking coal producers in Mongolia, providing exceptional value for its steel-producing customers.

Inner Mongolia Kingho Group is a wholly subsidiary of China Kingho Group, which was formed in 1996 and is one of largest privately held mining and energy companies in China. Over recent years, China Kingho Group has developed significant expertise in resources development, coal washing, coal chemical, fine chemicals, clean energy, coal gasification and logistics.

Since it was founded in 2000 Inner Mongolia Kingho Group has imported more than 26 million tons of raw coal from Mongolia and has the capacity to wash 8 mpta of coal, produce 4 mtpa of coke, produce 400,000 tpa of methanol from coke oven off-gas and produce 200 million coal ash bricks. The parent company, China Kingho Group produces 15 mtpa of coal, processes 12 mtpa of coal and produces 9 mtpa of coke.