CAPE TOWN (miningweekly.com) – South Africa can regain the leadership role in coal exportation by generating the fastest growth over this decade, DH Minerals MD Christophe Darbord said on Wednesday.

Darbord, who was addressing the IHS McCloskey South African Coal Exports Conference 2014, estimated that South Africa could place itself in a position to add 60-million tons of coal a year to its exports.

“South Africa is now in a better position than Indonesia to grow its coal export market,” he said.

South Africa, in his view, should take the opportunity to replace banned Indonesian coal, meet the growing demand from India, support domestic and regional demand and regain market share in Europe.

Action required would be to develop new coal mines, increase rail and port capacity for Cape-size vessels in particular, create partnerships and maintain political and social stability.

XMP Consulting senior coal analyst Xavier Prevost said the main problem was the lack of investment in coal mines.

He emphasised the ongoing importance of the Central basin’s Witbank, Highveld and Ermelo coalfields, which host South Africa’s biggest volume of coal reserves, and the risks of the Waterberg coalfield, the country’s biggest coal resource.

Osho South Africa director Zaheer Surka would like to see South Africa tailoring its low grade and off-specification coal for the market.

“If Asia can do it, why can’t South Africa do it?,” Surka asked.

Thebe Resources Incubator CEO Bevan Jones said juniors lacked access to prefeasibility finance and expected Eskom’s proposed mining development fund to grow the sector.

Thebe Resources Incubator expects to contract drilling companies and to skill up emerging black coal entrepreneurs for supply to Eskom.

Eskom group executive Kannan Lakmeeharan reported work had begun on the design of the mining development fund, where Eskom’s goal was to take a high level of risk and to offer technical support.

The scheme would also involve assisting value-adding traders to move up the value chain by, for example, beneficiating and briquetting coal.

It would be deciding how to support 50% plus one share ownership changes and had begun signing up memoranda of understanding with emerging miners in the Waterberg coalfield.

The State power utility would soon be issuing requests for proposals for emerging black miners to use the Eskom allocation at the South Dunes coal terminal at Richards Bay, in KwaZulu-Natal.

Earlier, IHS global steam coal advisory service senior director David Price had commented that South Africa had “lost ground badly” in 2013, despite the relatively weak local currency placing it in a favourable low cost position.

The country’s coal exporters “also missed the boat in 2012”, Price reminded.

Coal exports from South Africa’s private-sector-owned Richards Bay Coal Terminal (RBCT) rose to a record 70.2-million tons in 2013, 1.9-million tons more than the 68.3-million tons of 2012, thanks largely to State-owned transport enterprise Transnet railing 70.42-million tons, 2.8% more.

RBCT can handle 91-million tons a year, 10-million more than the 81-million-ton-a-year rail line.

Transnet is now railing eight 200-wagon trains a day from the coalfields of Mpumalanga, double the previous four, as part of its Shongololo service, which has reduced locomotive cycle times from 58 hours to 41 hours and wagon cycle times from 63 hours to 48 hours. RBCT has plans to expand beyond the 100-million-ton mark.