The Queensland government is a step closer to securing a lucrative mining contract with Chinese aluminium giant Chalco.
Premier Anna Bligh met with Chalco chairman Xiao Yaqing on Wednesday to sign a memorandum of understanding for a study into a $2.2 billion alumina refinery at Abbot Point, near Bowen in north Queensland.
The agreement comes after Chalco was granted a development licence for a 40,000 hectare site on Cape York for bauxite mining.
"We welcome Chalco's further investigation and see it as another step forward," Ms Bligh said.
"Chalco's move further supports its proposed bauxite mining operations near Aurukun on Cape York Peninsula."
A final decision will be made on the Abbott Point refinery towards the end of 2009, Mr Xiao said.
The Chinese miner is currently undertaking a two-year feasibility study into the Aurukun operations, which include a significant financial commitment to the traditional owners of the Aurukun community.
The Aurukun mine could produce over six million tonnes of bauxite a year, and an associated refinery more than two million tonnes of alumina a year, Ms Bligh said.