Australian firm claims good progress with Waterberg coal mine ALISTAIR ANDERSON Published: 2011/04/15 07:25:42 AM
RESOURCE Generation said yesterday that it had made progress with its plan to mine in the Waterberg region, which has one of the country�s largest remaining coal deposits.
In its report for the March quarter, JSE- and Australian Securities Exchange-listed Resource Generation said it was developing its Boikarabelo coal mine, aiming to produce 6-million tons of coal annually, of which half would be export quality. The balance would be domestic quality coal, for sale to power utility Eskom.
The mine will be operated by the Ledjadja joint venture, in which Resource Generation has a 74% shareholding. It said Ledjadja was granted a 30-year mining right by the Department of Mineral Resources.
Formal documentation and establish ing a $2m rehabilitation deposit are due to be completed by Easter.
Resource Generation is raising R4,5bn to fund the first phase of the mine. It also needs R2,5bn for rail from the mine and infrastructure. It wants to raise 40% through equity and the rest through debt.
The company said it wanted to start production in January 2013.
The second stage is set for 2018 and will increase output to 40 tons of annual run-of-mine production. This would make for export volumes of about 20 tons a year.
This product would be railed out of the Waterberg region. Some coal would be sold to Eskom, which wanted to use it for its power stations in Witbank and Middelburg.
In researching how it would export coal out of SA, Resource Generation is looking at three east coast ports: Durban, Maputo in Mozambique and Richards Bay.
Sydney, Australia-based Resource Generation is one of a few companies doing business in southern Limpopo�s Waterberg region. Others include Anglo Coal, Exxaro Resources and Firestone Energy.
Resource Generation�s share has never traded since it launched its secondary listing on the JSE on July 14 last year, leaving it with no share price or market capitalisation. There is an offer for 3c, but it has attracted no sellers. In its interim results for the six months to end-December it posted a headline loss of 0,01 Australian cents per share.
RES Price at posting:
97.0¢ Sentiment: Hold Disclosure: Held
