BHP Billiton Mitsubishi Alliance to acquire The New Saraji Coal Project

BHP Billiton Mitsubishi Alliance (BMA), 50:50 mining joint venture between BHP Billiton and Mitsubishi Corporation, has entered into an agreement to acquire 100 per cent of the New Saraji Project from New Hope Corporation Limited and Billiton and Mitsubishi will pay equally for the approximately $2.4 billion acquisition cost.

New Saraji is an undeveloped metallurgical coal resource located adjacent to BMA's Saraji mine near Dysart in Queensland's prolific Bowen Basin. New Hope's total coal resources estimate, according to a New Hope analysts briefing 27 March 2008 for New Saraji is 690 million tonnes, of which 156 million tonnes is the indicated resources with 534 million tonnes inferred resource.

The purchase comprises mining lease application and exploration prospecting consent, and port user contract entitling the purchaser to 10 million tonnes per annum of capacity at the Abbott Point coal terminal as it is expanded. Completion is subject to certain third-party consents and normal government approvals.

Dave Murray, president, BHP Billiton Coal, said, "This acquisition is consistent with our strategy to accelerate growth in long life, low cost natural resources with a focus on delivering shareholder value. Based on drilling results to date, New Saraji has extensive high quality metallurgical coal resources. Subject to the results of further resource exploration and evaluation program to be undertaken by BMA, New Saraji has the potential to be developed into a large scale, high quality metallurgical coal operation. New Saraji could also potentially deliver significant synergies due to its proximity to BMA's existing Saraji mine."

BMA is Australia's largest coal miner and exporter, and the world's largest supplier to the seaborne coking coal market jointly owned by the world's largest diversified resources company and the world's largest general trading company.

It was formed in June 2001, as a partnership between BHP Billiton and Mitsubishi Development Pty Ltd, under which the two companies share equal ownership and management of seven Central Queensland coal mines - Goonyella Riverside, Broadmeadow, Peak Downs, Saraji, Norwich Park, Gregory Crinum and Blackwater - and the Hay Point coal export terminal near Mackay.