Coal of Africa Limited has reported another extremely positive quarter as it integrated the Uitkomst colliery into its portfolio and advanced the sale of the non-core Mooiplaats colliery, resulting in its disposal at the end of September.
It said operational highlights were:
- No lost-time injuries (LTIs) recorded during the quarter (FY2017 Q4: nil);
- Results consolidated for the Uitkomst metallurgical and thermal coal colliery, acquired effective 30 Jun from Pan African Resources for R275m ($20.3m), of which R25m ($1.8m) is deferred;
- 165,432 tonnes of metallurgical, export quality and blended thermal coal sold by Uitkomst during the quarter;
- CoAL board approval of the Makhado hard coking coal 'Lite' project significantly reducing capital requirements and a shorter construction period; and
- Mooiplaats thermal coal colliery and the Vele coking and thermal coal colliery remained on care and maintenance.
Chief executive David Brown said: 'I am pleased to report on another extremely positive quarter for CoAL as we integrated the Uitkomst colliery into our portfolio and advanced the sale of the non-core Mooiplaats colliery, resulting in its disposal at the end of September 2017.
'The Uitkomst acquisition transformed CoAL into a coal producer and we are now well positioned to take advantage of higher global coal prices.
'The company is currently assessing Uitkomst's coal marketing options to maximise returns given the upward trend in export coal prices.
'The review of the Makhado project resulted in the company's directors approving the Makhado Lite project.
'Makhado's rationalised production profile significantly reduces execution risk and will ensure that CoAL's flagship project is brought into production faster than previously anticipated with a lower capital expenditure.
'The Makhado Lite project has the requisite regulatory approvals and the Company is working to secure access to two key properties that allows us to complete the confirmatory geotechnical work required before construction commences to ensure the project footprint is appropriately positioned.
'The Company anticipates that this will be resolved in either late H1 FY2018 or early H2 FY2018 with construction following in H1 FY2019.
'The accelerated build-plan positions Makhado to be able to take advantage of higher hard coking and thermal coal prices, delivering positive returns for shareholders in the near-term.'