Universal Coal brings SA mine start up forward
PERTH (miningweekly.com) – South Africa-focused Universal Coal has pushed forward the development of its A$46.8-million Kangala thermal coal operation by two months, with production now slated for February 2014.
Kangala would be Universal’s first operational mine, and some two-million tonnes a year of domestic coal sales to energy major Eskom had already been secured, with the remainder of the product shipped through the Richards Bay Coal Terminal.
The mine would deliver some 2.1-million tonnes a year of thermal coal, over an initial mine life of eight years, while an additional resource base potentially allowed Universal to expand this period to 20 years.
There was also the added opportunity to further increase the resource base and extend the mine life through potential joint ventures over neighbouring resources.
The ASX-listed Universal told shareholders on Tuesday that box cut operations would start in July, and first coal from this was scheduled for October this year. The initial coal would be used for the base of the stockpiles to prevent contamination at a later stage, with the remaining box cut coal used to commission the plant in December.
First coal production was scheduled for February.
All funding for the project had been fully secured, and Universal was aiming to achieve financial close of the project finance facility by June 19. The company noted that it would then be in a position to draw down the R300-million facility, within the next month, with further drawdowns on a regular basis, as required over the capital development programme.
Offtake agreements for the balance of the product, not being taken up by Eskom, were also advancing and would likely be finalised by the end of June.
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