Legacy Iron, the Australian arm of state-owned NMDC, has finalised the purchase of two of six highly prospective tenements in Queensland where there are strong indications of quality coking and thermal coal mineralisation.

It is the first corporate transaction undertaken by Legacy since India’s largest iron ore producer and rapidly developing steel maker, NMDC, acquired a 50 per cent stake in the company in December 2011.

According to a filing by Legacy with the Australian Stock Exchange, the two tenements — EPCA 2303 and EPCA 2304 — near the townships of Mundubbera and Eidsvold, have now been granted.

Legacy Iron had earlier said it is set to acquire six coal tenements in Queensland.

“The tenements have an in-situ exploration target of 130-580 mt3 (cubic million tonne) of thermal coal as well as some semi-soft coking coal potential. The tenements are proximal to excellent infrastructure with railway line to the port of Gladstone only 21 km east of the project area,” Legacy said in the filing.

Legacy Iron Ore Chairman N.K. Nanda said the acquisition of the two tenements is an initial entry into the Queensland coal sector, with the remaining four tenements awaiting grant.

“An aggressive drilling programme and environmental clearance are being prepared to rapidly identify a resource.

Legacy is also continuing negotiations for additional investment in potential coking coal assets in Australia,” Nanda said in the statement.

The final consideration for the acquisition is $100,000 deposit, $1.8 million cash payment and the first year rental reimbursement and a deferred cash payment of $2.5 million on certain conditions, the release said.

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