Completion of this transaction is subject to execution of a sale and purchase agreement with a project joint venture agreement to be then entered into between the parties.

Pursuant to the heads of agreement, Blackwood Resources will acquire a 90% interest in the coal tenements for a total cash consideration of $500,000 and PEV will hold a 10% interest in these tenements.

Blackwood Resources will be responsible for all expenditure on exploration and development costs (including all costs incurred in respect of the Department of Mines and Energy) until completion of a bankable feasibility study pertaining to these tenements.

Exploration and development of these resources will target open cut thermal coal deposits suitable for the export market. Both companies will begin the immediate development of the project development plan. Independent geologist reports have identified immediate drilling target areas, which the upcoming exploration program will focus on. PEV will use the proceeds from this agreement to help fund development of its other coal exploration tenements.

PEV and Blackwood Resources look forward to working together for their mutual benefit in order to further delineate the potential for coal resources on these tenements, the companies said.