Last year, River Energy entered into a non-binding term sheet with a substantial South African coal producer that would see River Energy build, own, operate and maintain a 500,000 tonne per annum Binderless Coal Briquetting (BCB) plant at the coal producer’s wash plant, processing a feedstock combination of new arising and reclaimed coal fines, he told the company’s annual general meeting.

“Since signing the term sheet, the River Energy team has continued to work on a study component of the project which has included testing coal fines at the Cessnock Demonstration Plant and detailed engineering and design work,” he said.

“This work and testing is now substantially complete. River Energy management are currently in the process of obtaining an agreement with this coal producer to proceed with the construction of a plant on their site.”

In December 2014, River Energy commenced the commissioning of its Fine Coal Beneficiation (FCB) plant which was constructed at the Woestalleen Hub.

Small quantities of in-specification product were produced before the operators of the site were placed in a “Business Rescue” process in January 2015.

The financial issues that the owners of the Woestalleen Hub have been dealing with has resulted in River Energy not being able to operate the FCB plant since January 2015, according to Flannery.

The Business Rescue Practitioner’s proposal was accepted by the creditors on 31 July 2015, however River Energy still awaits recommencement of operations on site.

“Our financial exposure is minimal but we would like to see new owners recommence operating as soon as possible,” Flannery said.

“Unfortunately River Energy was unable to advance discussions with Anglo American Coal (AAC) for the Goedehoop project opportunity.

“River Energy also continues to be actively involved with several other producers in the South African coal market, looking at projects that have the potential to meet the needs of both parties.”