Rio Tinto owned Riversdale Mining has signed take-or-pay agreement to sell thermal coal produced from its Benga mine in Mozambique to Trafigura for $200m.
The mine is expected to start production later this year.
The deal includes options to increase the tonnage as production increases at the mine.
The second and third stages of developing the Benga project will need an investment of $400m.
Riversdale managing director Steve Mallyon said the agreement is a critical first stage of growth and production at Benga provides the company exposure to the strong fundamentals of the seaborne thermal coal market.