The South African focused company already has four coal projects in various stages of exploration.

The Tshikunda Coal Project consists of prospecting rights over 32,583 hectares in the Soutpansberg / Pafuri coalfields within the Limpopo Province, South Africa.

GVM holds a further 8,000ha next to the new project area, as part of its Thuli coal project. Tshikunda also adjoins a coal mine held by Exxaro.

GVM managing director Simon Farrell said the acquisition was an important development in the company's goal of becoming a major player in the development of the Limpopo coalfields.

Under the agreement, GVM have committed up to $8.5 million to explore the prospect to a bankable stage. Thereafter, the parties will contribute development or capital expenditure on a pro rata basis.

"Whilst very limited work has been undertaken on the area in the past, it is now widely considered to be highly prospective as a significant source of hard coking coal," Farrell said.

"What is particularly exciting is that both Rio Tinto and ourselves believe the rank of coals improve eastwards of their Chapudi and our Baobab projects and given that the value of coking coal is now roughly double that of thermal coal, the dependence of a proximate power station to get the project up and running starts to disappear."

The Limpopo area is seen by many as the new coal province of South Africa, which has encouraged GVM to become a major participant in its development.