The acquisitions will help the company reduce development costs at the mine, Resource Generation managing director Paul Jury said.

“This parcel of land is critical to our plans. It forms a keystone between Resource Generation’s other landholdings and will facilitate our mining rights application and ensure minimum start-up costs for our Boikarabelo mine,” he said.

“This is the land where we have undertaken the latest infill drilling, with 21 cored holes and four percussion holes completed during the past quarter. Analysis of these results is expected to lead to an increase in the tenement’s resource and reserve classification.”

Resource Generation now owns sufficient land for its Boikarabelo mine and associated infrastructure to sustain mining operations for several decades.

The Boikarabelo tenements, which are in the Waterberg region of South Africa, currently have probable saleable reserves of 603 million tonnes of coal, plus an indicated resource of 570Mt and an inferred resource of 1.7 billion tonnes.

Production is scheduled to start in January 2013 subject to securing mining rights and development funding.

Resource Generation’s share price rose by 1c to 61c.