The memorandum of agreement signed earlier in April 2012, provided Sumitomo with an option to acquire 20%-50% interest in the tenements.

After the conclusion of two independent valuations, averaging A$108.8m ($111.6m) on a 100% basis, Sumitomo has elected not to acquire any stake in the tenements, the company stated.

Besides, the agreement excluded tenements including Washpool Hard coking coal project and Talwood coal project.

Meanwhile, the company has planned to offload its assets to raise funds for the development of $7.6bn West Pilbara iron ore project located in Western Australia.

With the termination of agreement, Aquila is seeking new ways to fund its West Pilbara project, in which it owns 50% stake. Other stakeholders include American Metals and Coal International (AMCI) and South Korean steel giant POSCO.