Under the terms of a recently executed sale and purchase agreement with Misty Sea Trading, Continental subsidiary Mashala will be able to develop the prospecting right comprising portion 25 of the farm Witbank 262 IT.
Continental said it was strategically located immediately adjacent to and adjoining the current open cast mining activities at Ferreira.
Continental already commenced mine planning work on the prospecting right to incorporate the adjacent block into the Ferreira mine’s existing mine plan.
A 15-hole exploration and resource confirmation drill program has been finalised and drilling is underway.
Continental is proposing to commence development of the prospecting right once relevant approvals have been obtained.
Mining on the prospecting right of between 350,000 and 400,000 tonnes of run of mine coal is slated to be completed within eight months.
Continental chief executive officer Don Turvey said acquiring the prospecting right would “contribute to our future development and mining activities in the Ermelo area adding further value to our shareholder offering at a time when we are also bringing our third mine at Penumbra into production”
Continental has a portfolio of advanced mine operations, including its Penumbra mine in the Ermelo coalfield and its Ferreira open cast mine.
Ferraeira achieved ROM coal production of 105,119t over January and February – 14% above budget production levels.