Under the agreement, Sishen Iron Ore Company Community Development Trust will acquire a 26% interest in Continental’s South African subsidiary.

SIOC-cdt is a South African miner established out of Kumba Resources in 2006 as part of the government’s black economic empowerment initiative.

Continental chief executive Don Turvey said the first payment was a milestone in the development of an arrangement first announced in November 2012.

“The partnership with SIOC-cdt is considered to be a landmark agreement and we believe it will have a major impact on our business activities and opportunities in South Africa,” he said.

SIOC-cdt chairman and newly appointed chairman for Continental’s RSA subsidiary Connie Molusi said the transaction would help expand his company’s presence in the South African coal scene.

“We are pleased that our investment in CCL has proceeded and as a partner with Continental, we can now look forward to working together to further build on our thermal coal mining business in South Africa,” he said.