Northern Energy (ASX:NEC) Shares Sharply Up on China Deal

Sydney, April 22, 2010 AEST (ABN Newswire) - Shares in Northern Energy Corporation Limited (ASX:NEC) jumped 9 per cent after it said today it has signed a life of mine off-take agreement with Chinese steel maker Xinyang Iron & Steel Group Company Ltd (Xinyang Steel).

A subsidiary of Xinyang Steel has entered into a long term coal off-take agreement to purchase 65 per cent of the coking coal output of any mine development associated with Northern Energy's Maryborough hard coking coal project in Queensland.

This agreement would deliver approximately A$700 million sales revenue to Northern Energy in 10 years at current coal prices. The Australian coal miner will also issue A$23 million shares at A$1.41 per share to Xinyang Steel with a board seat in Northern Energy. The placement will provide funds for the development of the Colton mine.

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Michelle Liang Asia Business News Asia Bureau Tel: +61-2-9247-4344 Email: michelle.liang@abnnewswire.net