Holfontein Investments, which GVM has a 49% interest in, was awarded the right.

According to GVM’s scoping study released in December last year, the project contains an indicated gross in situ resource of 56 million tonnes and 22 million saleable tonnes. The study also suggested a total project value of $A40 million.

The Holfontein project in South Africa’s Witbank coalfield consists of two mineable coal seams that contain coking coal and low grade steam coal. GVM said the project would have access to good infrastructure including rail, road and electricity.

GVM managing director Simon Farrell said the next step in the project was to complete an 18 borehole infill program that will form the basis of a bankable feasibility study and establish a measured reserve.

GVM and Motjoli will spend just over one million rand on drilling, logging, analyses and modelling. The program will be completed by June and the feasibility study finished by August.

“The great beauty of Holfontein is that it is in an area where the geology is well understood, infrastructure and services are in place and key markets are nearby,” Farrell said.