Dineo Faku
EMERGING coal mining firm Coal of Africa Limited (CoAL) has suspended operations at its Vele colliery in Limpopo amid floods in which six people have died.
The Sydney- and JSE-listed firm said it had recorded more rainfall this past week than an average year, but it expected normal operations to resume in a week. “The mine site has recorded 500mm rainfall in the past five days compared to 450mm normal rainfall per annum,” it said.
Vele, which is situated on the outskirts of the Mapungubwe World Heritage Site, had a stockpile of 5 500 tons of thermal coal and produced 7 000 saleable tons weekly, the company said.
The rain had stopped, CoAL said, and management visited the site yesterday to assess the impact, and to begin re-establishing access to the open pit.
“Flooding of opencast operations such as Vele in instances of heavy rain is common in the industry, not peculiar or unique to Vele,” chief executive John Wallington said in a statement.
Meanwhile, Eskom said heavy rains over the weekend had had an impact on the transport of coal to power stations.
“However, we have an average of 46 days of coal stocks across our fleet of power stations, unlike in 2008 when stock days fell to 12. We are monitoring the weather and the risk is being managed,” the parastatal said.
XMP Consulting analyst Xavier Prevost said the flooding posed no risks to coal deliveries as there were no other coal mines in the area and job losses were not on the cards as the mine would reopen once flooding subsided.
Earlier this month, CoAL announced that China had given regulatory approval to proceed with a deal to place CoAL shares worth $100 million (R882m) with Haohua Energy International.
The Chinese state-owned firm was given the green light ahead of schedule to subscribe to the CoAL shares at 25p (R3.43) each.
CoAL shares fell 0.32 percent to R3.10 on the JSE yesterday.