Coal of Africa stung by Green Scorpions

COAL of Africa shares closed 23% lower yesterday as the company was ordered by South Africa’s environment department to cease construction at the Vele Colliery amid an investigation into alleged illegal activities.
Coal of Africa stung by Green Scorpions Coal of Africa stung by Green Scorpions Coal of Africa stung by Green Scorpions Coal of Africa stung by Green Scorpions Coal of Africa stung by Green Scorpions

Coal of Africa's projects

Blair Price

Company management and government environmental officials met on Tuesday, with Coal of Africa suspected of carrying out “illegal activities”.

The country’s Environmental Management Inspectorate, known as the Green Scorpions, served a compliance notice to Coal of Africa.

The company was ordered to cease construction on roads within and outside its mining right area for three days.

An onsite fuel storage tank was ordered to be emptied until the company has received legal authority to store the fuel.

All construction activities within 32m of drainage lines of the Limpopo River was immediately ceased for 24 hours, along with construction activities associated with the sludge dam at Vele.

Coal of Africa was ordered to appoint an accredited environmental consultant or legal specialist within five working days and to submit another environmental report to the Department of Environmental Affairs within 15 working days.

“The Green Scorpions will be monitoring the situation at Vele Colliery,” the inspectorate said.

“Failure to comply with the instructions in the notice is a criminal offence and would result in further charges to the criminal investigation that is already underway.

“Should the mine fail to comply with the instructions, the department may also approach the High Court for an interdict.”

Coal of Africa is maintaining its stance that all of its activities are within the rights of the New Order Mining Right it received from the South African government in March.

“The company is nonetheless complying with that notice as required and confirms it has ceased certain activities at Vele,” Coal of Africa said.

The triple-listed company confirmed it was working with the department in good faith.

“The company remains confident that an outcome satisfactory to both parties will be achieved,” the company said.

Coal of Africa also noted it had not received the Integrated Water Use Licence it applied for back in November.

The IWUL is required for any mining and processing of the coal to take place.

In February, the company gained full ownership of the Vele open cut project and the phase one of development was aiming for first coal in the next two months.

Phase one development is targeting 1 million tonnes per annum of coking coal while a later second phase will lift production to 5Mtpa of saleable coking coal.

Coal of Africa shares gained 5.5c or 4.3% this morning to $1.34.

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