The South Africa-focused company announced that an external market report had verified the high quality of potentially 2Mtpa of hard coking coal and 3Mtpa of thermal coal.
“The Makhado project represents Coal of Africa’s initial project within the greater Soutpansberg Coalfield area and is currently finalising the additional external verification processes required for the Makhado definitive feasibility study on the opencast mining area,” the company said in a statement.
The study is expected to be published by the second quarter of this year. The company is also waiting for the new order mining right for the project to be granted.
“The confirmation of the product quality as a hard coking coal supports our technical assessment and augurs extremely well for placing this product into the market and the future development of the project,” Coal of Africa CEO John Wallington commented.
Coal of Africa also reported its results for the second half of the 2012 calendar year.
Coal sale revenue for the six months totalled $US87.3 million compared to $US125.8 million for the comparative period, due to lower coal prices and reduced production as a result of strike action that lasted for six weeks at the Mooiplaats Colliery.
The loss for the six months under review amounted to $US111.7 million, or 14.39 cents.
The company reported an increase in production but a decrease in export sales down to 636,264 tonnes from 863,893 tonnes in the previous corresponding period.
The company credited this decrease to the reduction in production volumes after strike action, and the impact of tippler upgrades at the Matola Terminal in Maputo, Mozambique.
Coal of Africa’s principal assets and projects currently include two coking and thermal coal projects in the development stage, two exploration and development stage coking and thermal coal complexes, each comprising three large scale coal projects, two thermal coal collieries, and approximately three million tonnes per annum port and rail capacity at the Matola Terminal.
The company said that it was “considerably better placed” after $100 million of equity funding by Beijing Haohua Energy Resource in September, but continued to work on its turnaround strategy to prevent further losses.
