Coal news and updates

Baphumeleli to boost coal output to 250 000 t/m from March

Black economic-empowerment (BEE) miner Baphumeleli Resources aims to produce 100 000 t/m of coal by the end of this month and the planned commissioning of two mines by the end of March 2014 will add a further 150 000 t to the company’s monthly production.

Baphumeleli Resources communications manager Sipho Khumalo says the

company currently has two offtake agreements involving a total of about 100 000 t/m of coal.

The planned commission of the two coal mines by mid-2014 will increase yearly production to more than 1.8-million tons from its own mines and 1.2-million tons from the offtake.

“We are very happy that, as small as we are, we have a monthly revenue of R35-million. The two mines will add a further R43-million turnover to our books,” he says.

One of the biggest mines that the company owns is LLG Coal, in Sasolburg. The mine will start production at 40 000 t/m, increasing to 100 000 t/m at steady-state production.
Baphumeleli is also mulling the possi- bility of offering its products to the inter-national market.

Khumalo notes that, while the company is producing export-quality products, there are challenges to being a new player in the coal market, as development costs are always a challenge for up-and-coming junior miners.

“We are negotiating with an undergroud mine specialist that supplies underground mining equipment. “If negotiations go well, the company will save R15-million in upfront development costs. “The company might assist us in leasing the machines and we can start payments only in the fifth month. “This will help us a lot in terms of cash flow,” he says.

Baphumeleli Resources is also considering shale gas exploration, which Khumalo notes is gaining momentum, but, he adds, however, the company is carefully considering this exploration.

Source: www.miningweekly.com