JOHANNESBURG (miningweekly.com) – Emerging-miner Coal of Africa Limited (CoAL) was still awaiting the granting of mining rights in South Africa for its 80%-owned Vele coking-coal project, on which it could spend up to R3,2-billion in capital expenditure.

On Friday, the ASX-, Aim- and JSE-listed coal-miner said it was set to start phase one of the project, in Limpopo province, as soon as it was granted mining rights for the project area by South Africa’s Department of Mineral Resources.

It had initially expected the authorities to grant the mining rights by September, but said it now expected to receive approval early this year.

It would spend an estimated R350-million on phase-one development, with dry and wet commissioning of the one-million ton a year modular coal treatment plant having already been successfully completed.

The construction of supporting infrastructure was also on schedule.

Further, a mining contract with opencast mining contractor MCC Contracts would be signed early this year, following a previously signed memorandum-of-understanding between the parties.

The coal producer again emphasised that it could double the output of the plant, should steelmaker ArcelorMittal South Africa choose to increase its off-take from the Vele project, but said that this would cost an additional R200-million.

In terms of a letter of intent, signed by the parties in 2008, ArcelorMittal could increase its off-take from CoAL’s coking-coal properties to between 2,5-million tons a year and five-million tons a year.

Phase two of the project, which would cost about R2,65-billion to develop, would deliver five-million tons a year of coking-coal. Its commencement date would be determined according to market demand.

MOOIPLAATS SHIPMENTS

Meanwhile, CoAL reported that in excess of 47 000 t of lean coal from its Mooiplaats thermal project, in Mpumalanga province, had been railed from the Umlabo siding to the Matola coal terminal, in Mozambique, by the end of December.

The first shipment had been sent to the terminal, where CoAL had capacity to stockpile up 80 000 t of coal, in September last year.

The project remained on track to produce its first export quality coal during the first quarter of this year.

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