CoAL making progress at Vele

031110 A new study has found that SA coal reserves have been significantly downsized since 2003.photo by Simphiwe Mbokazi 453

031110 A new study has found that SA coal reserves have been significantly downsized since 2003.photo by Simphiwe Mbokazi 453

Published Mar 12, 2012

Share

Mining company Coal of Africa (CoAL:CZA) reported on Monday that revenue from the sale of coal, for the six months ended December 2011, totalled US$143.8 million compared to US$88.3 million for the comparative period.

The company reported a loss for the six months under review amounting to US$74.7 million or 13.36 cents per share compared to a loss of US$66.5 million or 12.30 cents per share previously.

Sales of export quality coal on international markets increased by 15.5% to 798,311 tonnes, attributable to improved rail performance, a slight recovery of market conditions and increased capacity at the Matola Terminal in Maputo, Mozambique compared to the previous six month period.

During the six months under review Woestalleen sold 449,237 tonnes, compared to 621,799 tonnes, Mooiplaats sold 80,991 tonnes of export quality coal compared to 124,388 tonnes to the comparable period, to domestic customers.

Eskom purchased 344,390 tonnes from last year's 106,000 of middlings coal from Woestalleen and 68,259 tonnes from Mooiplaats.

CoAL advised that it had entered into definitive agreements with Rothe, a black economic empowerment (BEE) company which would represent local communities, to acquire a 26% shareholding in a wholly-owned CoAL subsidiary, was expected to hold the Chapudi coal project and related exploration properties upon completion of the acquisition from Rio Tinto minerals development and Kwezi mining.

Total production from Vuna of 1,719,506 tonnes was 2.6% lower than the comparative six month period of 1,764,830 tonnes, primarily due to limited pit room and a shorter month in December.

Operational performance is expected to improve during the second half of H2 FY 2012, with a projection of 1.62 million tonnes run on mine for the six months to June 30 and full year production outlook of approximately 3.3 million tonnes run of mine.

The Woestalleen wash plant produced 823,877 tonnes (H2 FY2011: 1,009,519 tonnes) of export quality coal and a further 334,123 tonnes (H2 FY2011: 161,346 tonnes) of lower grade product for Eskom.

The company said that safety at Mooiplaats continued to be a focus area, after four lost time injuries were reported at the mine during the six months.

CoAL added that progress on converting the memorandum of understanding into an memorandum of agreement had progressed satisfactorily for both parties, and that significant information sharing had taken place between the two parties to date in the spirit of the memorandum of understanding, and that once the review of specific technical studies has been concluded, both parties would be in a position to conclude the memorandum of agreement.

The company said the most significant development of the half-year was the lifting of the integrated water use license at Vele Colliery.

“This has enabled management to complete construction of the infrastructural facilities, building of the plant, and commence production at Vele at the end of the half-year, with the first sales of coal expected in Q4 FY2012,” CoAL said. - I-Net Bridge

Related Topics: