Revealed in its 2008 December quarter activities statement, the junior has now received and put into operation its second continuous miner and said the washing plant should be ready by March in time for production from the advanced stage underground mining portals.

First coal sales are expected in this year’s second quarter and over 150m of incline conveyor belt structure has been installed at this stage.

The previously announced negotiations with Transnet Freight Rail for moving coal to the Richards Bay terminal have been finalised, securing the Mooiplaats operation’s needs in a five-year agreement.

CoA said the freight company would satisfy the initial 900,000 tonne per annum port allocation and could supply more wagons to cater for 3 million tonnes per annum should the port terminal expansion plans proceed.

On the sales front, CoA said it had submitted an initial letter of offer to South African power utility Eskom with follow-on discussions expected to be concluded when export sales start from the mine in this year’s second quarter.

Other discussions are continuing with various parties over long-term export agreements in the meantime.

For its 74%-owned Vele coking coal project in Limpopo, CoA has lodged an environmental scoping report with South Africa’s Department of Minerals and Energy while specialist studies for the environmental management plan and impact assessment documents are to be sent through within the next couple of months.

Core sample analysis from three bulk drill sites is underway while the company said 12 holes were due for completion in early 2009 as part of its drilling program to define the site of the proposed bulk sample box cut.

A revised mine production schedule now includes both underground and open cut sections and is expected to improve coking coal yields, reduce mining costs and extend mine life to beyond 2040.

The New Order Mining Right application was submitted to the DME back in October and CoA said Vele was ready to start mining in the second half of this year providing it is granted.

Exploration at the company’s wholly owned Makhado project covered 3400m in the last three months of 2008 with the 20-hole large diameter drilling program having 12 holes completed by year-end.

Full results are expected in the second half of this year with CoA saying core analysis undertaken has yielded good quality hard coking coal.

Environmental documentation is underway while the NOMR application for the project is almost complete.

CoA aims to start up the project a year after Vele kicks off.

Meanwhile, CoA’s wholly owned Holfontein project sale to Lachland Star has been shelved as the latter company failed to receive shareholder approval.

As part of national legislative requirements, CoA said it had extended its Black Economic Empowerment agreement to the end of April 2009.

CoA managing director Simon Farrell said he was pleased with the progress made and said the company’s zero-debt and cash position made it well placed to bring the Mooiplaats, Vele and Makhado projects into production within the next two years despite the challenging global economic conditions.