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Australian company secures agreement for BCB plant in Witbank

CESSNOCK BCB TEST PLANT The binderless coal briquetting plant is used to  turn an environmental liability into a revenue stream

CESSNOCK BCB TEST PLANT The binderless coal briquetting plant is used to turn an environmental liability into a revenue stream

16th September 2016

  

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Australian coal company White Energy’s River Energy joint venture (JV) with investment firm Black River Asset Management has entered into an agreement with a major Witbank coal mine to build a binderless coal briquetting (BCB) plant.

White Energy announced in June that, while the major commercial terms had been largely agreed on with the coal producer, “the negotiating of final binding transaction documentation has taken longer than anticipated”. However, the company states that this process should be completed in the near future and that details of the project will be announced when the terms have been finalised.

The River Energy JV seeks to commercialise opportunities in the African coal mining industry that leverage BCB technology. The JV established a South African operating company called River Energy South Africa (Resa) in 2011. White Energy owns 51%, with Black River holding the remaining 49%. Resa retains an exclusive licence to use the BCB technology in Africa.

White Energy explains that BCB technology upgrades subbituminous coals through a thermal drying process followed by physical and chemical stabilisation using a binderless briquetting process. According to the company, this provides coal-fired power stations and other industrial applications with the opportunity to “burn a cleaner and more efficient coal”.

The definitive feasibility study of the Witbank project was mostly completed before December 2015, after which the focus was shifted to reviewing project options and seeking agreement on transaction details with the South African coal producer.

All testwork for the project was conducted at White Energy’s Cessnock BCB production plant, in Australia, and the engineering and metallurgy packages for the original project are also mostly complete.

The Resa technical teams worked with the coal producer during the last quarter of 2015 to redefine the size, location and scope of the project into a package that works for both parties.

“While the key drivers for this project have not changed and both parties are working to achieve a positive outcome, it is clear that current market conditions have not helped [Resa] maintain the momentum of this project over the last six months,” White Energy notes.

Resa continues to focus on the commercialisation of the BCB technology for the purposes of recovering and briquetting discarded thermal coal fines in the South African market. It is focused on the traditional coal fields in South Africa’s Witbank region where significant amounts of fine coal are discarded yearly into well-managed tailings dams close to power stations. The cost and environmental issues surrounding the operation and the maintenance of tailings dams are driving major miners to look to solutions like the BCB technology, which can turn an environmental liability into a revenue stream while improving the overall mine yield, highlights White Energy.

Resa’s business model in South Africa is to build, own and operate the projects in which it is involved, an approach that is resonating “very well” with resource owners, particularly in the current challenging economic environment.

One such project, Woestalleen Hub, at the Woestalleen Colliery, in Mpumalanga, has been placed on hold as the mine operators are under business rescue. White Energy states that Resa has removed its plant from the Woestalleen Hub site as the business rescue practitioner continues to implement its business rescue plan. “[Resa] will continue to monitor progress, but expects to devote its resources to the [Witbank] BCB plant project in the foreseeable future.”

Edited by Tracy Hancock
Creamer Media Contributing Editor

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