Coal tenements on the new property are currently owned by Exxaro Resources which has the option to sell ResGen prospecting rights subject to government approval.

The coal tenements in the acquired properties contain an indicated resource of 974.5 million tonnes, excluding shale content, according to exploration results compiled by a consultant to ResGen.

The company says the Kleinpan property, which represents part of the acquisition deal, contains no defined coal resource but will be an ideal location for the two 660-megawatt coal fired power stations which Indian utility provider CESC intends to build.

ResGen managing director Paul Jury said the property deal enabled Boikarabelo to commence its next planned expansion phase.

“The acquisition of the land enhances our ability to expand to stage 2 while the additional coal tenements would deliver ideal mining synergy enabling a continuation of the mine’s strike length in an easterly direction, enhancing efficient mining,” he said.

Resource Generation is developing coal projects in South Africa’s Waterberg region where the company reports a probable reserve of 744.8Mt of coal.