Universal set to acquire SA mine from Exxaro

UNIVERSAL Coal has entered into binding sale of agreement with South African coal giant Exxaro Resources to acquire all the assets and assume certain liabilities of the New Clydesdale Colliery, located adjacent to its Roodekop deposit.

Lou Caruana

The agreement could help transform the company into a multi-mine coal producer, its CEO Tony Weber said.

“The acquisition of NCC marks a major step forward to becoming a leading mid-tier coal producer, expediting development of our second operation immediately on the heels of commissioning our first operation, Kangala mine near Johannesburg.

“Our Roodekop deposit contains an 84-million-tonne coal resource, 82.9Mt of which is measured, and is awaiting only the granting of a water use licence before development activities can commence.

“In combination with NCC’s established operation and infrastructure, the path forward to bringing our next mine on stream has certainly been fast tracked.”

Located 34km south of Emalahleni in the Mpumalanga Province, NCC is one of the oldest coal mines in South Africa, having been worked on sporadically since 1949 and operating as recently as December.

Historically, this operation has produced about 717ktpa of thermal coal from underground and open pit operations, primarily for the export markets through the Richard’s Bay Coal Terminal.

The operation has an extensive resource base and coal beneficiation facility, with a run-of-mine throughput capacity of about 2Mtpa.

The mine is fully equipped with mining machinery and infrastructure able to operate three underground mining

sections.

NCC is located close to established road and rail infrastructure, with a private railway connection with Transnet Freight Rail allowing for direct export of its coal.

Exxaro established that NCC was no longer strategically aligned with its group strategy and embarked on a public disposal process in April 2013, before ultimately placing the operation on care-and-maintenance in December.

NCC’s most recent operations, which focused on its Diepspruit resource, were contiguous to Universal Coal’s Roodekop coal resource.

Universal Coal believes that the combination of NCC’s operations with the Roodekop deposit will enable the extension of NCC’s life of mine to 2030. Roodekop has an estimated LoM of 15 years, 8 years of which will be open pit and allow Universal Coal to integrate Roodekop into the NCC mining infrastructure.

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