MC Mining Limited (Coal of Africa)
MC Mining Limited (Coal of Africa)
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Softer markets and delays in unloading trains due to mechanical issues and lower capacity at Maputo’s Matola terminal in Mozambique cut export sales by South African producer Coal of Africa by 83% during the September quarter.
Index-linked RB1 export quality thermal coal prices declined by 19.8% from $US106/t January 1 to $85/t September 30, averaging $87/t for the quarter.
South African miner Exxaro has pulled out of its pre-emptive right to take 30% of Coal of Africa’s 5Mtpa Makhado coking coal project in the Soutpansberg coalfield in Limpopo, South Africa.
CEO Sipho Nkosi signalled a more cautious approach to investment in the negative global and local macro-economic outlook in announcing the decision not to exercise its buy-in option.
Chinese coal producer Beijing Haohua Energy Resource Group will invest $US100M with South African thermal and coking coal company Coal of Africa to support its operations and development projects.
In its first investment outside China, BHE through subsidiary Haohua Energy International (Hong Kong) signed a binding agreement to subscribe for $100M of shares at £0.25 with a view to establishing a long term strategic partnership.
Australian businessman Blair Sergeant says he will vigorously defend a court case in which his former South African employer, major coal producer Coal of Africa Ltd, is accusing him of breaches of duty.
Sergeant, MD of Perth-based Lemur Resources, has had $A6M in assets frozen pending the hearing of the civil case in Australia’s Federal Court.
He was CoAL’s finance director in Johannesburg for three years until April 2011, when he resigned to return with his family to Australia.
The Federal Court of Australia has granted an order freezing $A6M in assets of Perth-based businessman Blair Sergeant over legal proceedings brought by his former employer, Coal of Africa Ltd.
The South African-based company launched proceedings in the Federal Court in Sydney alleging breaches of duty by Sergeant as a director and employee. CoAL says the allegations against Sergeant relate to a corporate transaction in which Sergeant was involved in 2009 and 2010.
National Union of Mineworkers members at Coal of Africa’s Mooiplaats Colliery in South Africa have begun protected strike action following a breakdown in negotiations over annual wage negotiations.
CoAL says the strike has stopped operations at the thermal coal mine near Ermelo in Mpumalanga province.
The company says its offer amounting to 22% was rejected, and mediation also failed to avert the stoppage. CoAL confirms it will apply the no work-no pay rule in relation to this strike.
Coal of Africa has raised $US44.8M through a placing of nearly 115.5M shares at R3.25 per share to overcome a funding shortfall for major development works at its South African mines.
The company says the net proceeds together with existing cash of $11.6M will help to fund plant development at the Vele colliery, drilling and studies of the Generaal, Voorburg and Jutland projects, assessments for the Greater Soutpansberg project and the first payment for the Chapudi acquisition.
Coal of Africa is holding talks with various parties on further funding as it faces a funding shortfall of about $US15.7M for the September quarter after all its thermal coal mines reported losses in the June quarter.
The pressure on index-linked coal prices from $US103/t in March to $87/t at the end of June established the trend that is now expected to persist into Q1 2013.