A Chinese mining company has reportedly offered $600 million for a mining licence in the Gunnedah region.

The China Shenhua Energy group has outbid Australian companies BHP Billiton and Xstrata in a tender for the exploration licence for the Watermark exploration area.

The successful bid has not been announced.

The Gunnedah basin area is believed to contain deposits of up to one billion tonnes of coal.

Watermark is next to the Caroona exploration area, where about 300 farmers and their supporters are continuing a blockade to keep BHP Billiton from drilling on private property.

The Newcastle Herald reported this week that BHP Billiton was believed to have offered about $200 million

for Watermark.

This would mean a reprieve for Caroona farmers, because the company has apparently proposed putting Caroona on hold to develop Watermark.

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