Linc Energy receives A$20m in payment for African coal gasification project

Linc Energy's chief executive Peter Bond. The Australian energy firm has received a payment of A$20 million (S$22.69 million) from South African coal miner Exxaro as part of an intellectual property licence agreement. -- PHOTO: LINC ENERGY
Linc Energy's chief executive Peter Bond. The Australian energy firm has received a payment of A$20 million (S$22.69 million) from South African coal miner Exxaro as part of an intellectual property licence agreement. -- PHOTO: LINC ENERGY

Australian energy firm Linc Energy has received a payment of A$20 million (S$22.69 million) from South African coal miner Exxaro as part of an intellectual property licence agreement.

With this payment now having been made, the two partners can continue the development of their first joint underground coal gasification project (UCG) in Sub-Saharan Africa, Linc Energy said on Thursday.

UCG is the process of converting coal into a valuable synthetic gas and Linc Energy owns and operates the world's only commercial UCG operation, in Uzbekistan.

Linc Energy, which last month moved from the Australian Stock Exchange to the Singapore bourse, is entitled to a further payment of A$7 million when the gasifer passes some performance tests. It will also receive ongoing royalties for the synthesis gas produced and equity participation in future projects.

Linc chief executive Peter Bond said: "We are delighted to receive the A$20 million payment from Exxaro but even more delighted to be moving this exciting project forward to first production.

"We look forward to further announcements in 2014 that further add value to the UCG commercialisation path and value chain of our technology and know-how as we drive UCG to become the next energy platform, which is so urgently needed in regions like South Africa, Central Europe and Asia."

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