MC Mining Limited (Coal of Africa)
MC Mining Limited (Coal of Africa)
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State-owned Chinese coal producer Beijing Haohua Energy Resource has established a strategic relationship with Coal of Africa that the South African-focused miner believes will help it realise the full value of its operations.
CoAL's cooperation agreement signed with Hong Kong-based wholly owned subsidiary Haohua Energy International covers the interchange of technical expertise on commercial, technical, financial and operational issues.
A $US50M impairment charge related to the Mooiplaats colliery has seen South African-focused coal producer Coal of Africa plunge to a $111.7M loss for the Dec 2012 half, way up on the $74.7 loss for the 2011 half.
The loss, on revenue down from $143.8M to $87.8M, was hit by $98.3M of non-cash charges (2011: $70.3M), of which the $50M Mooiplaats loss was the biggest and sheeted home to lower coal prices, production targets not met, 6 weeks of strike action and relatively higher logistics cost.
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A 6-week strike, lower coal prices and higher costs pushed CoAL’s non-cash charges out to over $98M, $50M of that down to one colliery.
A coal quality study for South African-based miner Coal of Africa’s initial Solutpansberg Coalfield project has underlined its potential as a world-class hard coking coal producer.
Coal of Africa says the Makhado project in the Limpopo province could produce 2Mtpa hard coking coal and 3Mtpa thermal coal.
A definitive feasibility study on the opencast Makhado project is due for release next quarter.
Coal of Africa has declared force majeure at three of its thermal coal projects following a derailment on the Maputo rail corridor in South Africa.
All rail traffic between Komatipoort and Maputo will be suspended for at least seven weeks, and previous attempts to establish alternative routes to the Matola port have been unsuccessful.
Coal of Africa subsidiaries Limpopo Coal Company (Vele Colliery), Langcarel (Mooiplaats) and NuCoal Mining (Woestalleen) have issued force majeure notices.
Coal of Africa shareholders have endorsed the $US100M Chinese investment that is expected to form the basis of a company-transforming strategic partnership for the development of the company’s South African assets.
The investment will begin with the $80M issue of conditional placement shares to Haohua Energy International, the Hong Kong subsidiary of Chinese coal producer and largest anthracite exporter Beijing Haohua Energy Resource.
Operations at Coal of Africa’s Vele Colliery have been forced to stop due to flooding in the Limpopo Province, South Africa.
The mine site has recorded 500mm of rainfall in the past five days, higher than the region’s usual annual total of 450mm.
CoAL’s Dongola Ranch lodge and management facility, near the colliery, has become a communications hub and a base for people stranded near the Mapungubwe World Heritage Site and surrounding farms.
The $US100M Chinese revival package for South Africa-focused miner Coal of Africa now awaits only shareholder approval after China’s usually slow-moving government authorities gave their approval to the deal.
Beijing Haohua Energy Resources has told CoAL it received the requisite approvals ahead of schedule from the Beijing Municipal Commission of Development and Reform and the National Development and Reform Commission.
Coal of Africa has handed over marketing of its export thermal and coking coal to the Vitol Group of Companies, under a binding MOU.
The agreement covers all export coal over a period of 8 years, with the exception of the Makhado project, which has a marketing period of 5 years from the start of production.
Coal of Africa CEO John Wallington said the MOU gave the company access to a global marketing network, assisting with the development of its export markets.
Coal of Africa says it should return to normal production by the end of the week at its Mooiplats thermal coal mine in South Africa’s Mpumalanga Province after agreeing to reinstate 178 employees who had been dismissed for involvement in illegal industrial action.
The company signed a memorandum of understanding with the National Union of Mineworkers to re-employ the workers dismissed Dec 6.