Universal Coal to push ahead with New Clydesdale colliery 18TH...

Universal Coal to push ahead with New Clydesdale colliery


18TH JULY 2016

BY: MEGAN VAN WYNGAARDT
CREAMER MEDIA CONTRIBUTING EDITOR ONLINE


JOHANNESBURG (miningweekly.com) –South Africa-focused Universal Coal plans to restart the
New Clydesdale colliery (NCC), in Mpumalanga, as an export-focused coalmine, while negotiations continue
to supply State-owned power utility Eskom.

CEO Tony Weber on Monday also expressed the ASX-listed company’s disappointment that triple-listed
Coal of Africa Limited’s A$126.4-million offer to acquire Universal Coal had lapsed, but said that the firm
had a “clear path” forward to commission the colliery in the next few months.


He said NCC would be developed to supply the exportthermal coal markets and that the balance of product
would be sold in the domestic space. “This could entail coal sales toEskom on a short-term supply basis and
to other local acquirers or traders of domestic thermal coal,” Weber stated. Universal also continues to engage
with Eskom on potential offtake agreements for thermal coal product from NCC.

Weber further outlined that with Universal’s Kangala colliery delivering record production in the fourth quarter, ended June 30, increasing run of mine (RoM) by 35% to 1.04-million tonnes, and 32% up for the full year, the company was well positioned to generate strong cash flow and support further growth for the rest of the year.
Total coal sales increased by 39% quarter-on-quarter to 609 120 t, while full-year sales exceeded two-million
tones, with the mine producing over three-million tonnes in the financialyear.

Weber remarked that having concluded the pit reconfiguration, Kangala was “firing on all cylinders”, and
delivering record production in the process. “We anticipate increasing production further in the year ahead,
thereby delivering strong sales and cash flow to pay down debt facilities and to fund growth prospects.”