JOHANNESBURG (miningweekly.com) – Coal exploration, development and mining company Coal of Africa Limited (CoAL) on Monday reported the narrowing of its losses in the 12 months to June 30, an upcoming extraordinary general meeting to secure preproject funding for its promising Makhado coking coal project and engagement from next month to secure funded black economic-empowerment (BEE) credentials for the greenfield asset.

The ASX-, Aim- and JSE-listed company headed by CEO David Brown, reported a significant decrease in losses for the year of $6.7-million compared to $84.1-million last year.

The company is working towards a production target of 6.7-million tons of saleable coal product by 2018.

The financial results for this year reflected reduced net operating losses and liabilities, resolved legal issues and a strengthened balance sheet.

With anticipated cash from Yishun in the next week, as well as the sale of Mooiplaats colliery, the company expects to have a de-risking $65-million (R700-million) on the balance sheet that will provide “ample" working capital plus the preproject funding to ensure a construction start date in the second half of 2016.

“We’re seeing good regulatory progress being made on Makhado,” Brown said in a global conference call in which Creamer Media’s Mining Weekly Online took part.

Having largely completed its turnaround strategy and being in a position to advance on project development, the company now also has, for the first time, the potential for mergers and acquisitions (M&A) on its radar screen.

Given the current market environment, CoAL believes consolidation in the junior space to be appropriate and wants to use its improved position to potentially take advantage of any M&A opportunities that arise.

“It’s been a very difficult three years and we’ve done more than survive. We’ve actually thrived,” said Brown, who said he was now focused particularly on securing Makhado preproject funding.

The company regards the exploration and development of its prospects in the Soutpansberg coalfield as the catalyst for the long-term growth of the company.

No revenue was generated during the year as a result of all the operations on being on care and maintenance, compared with the $3.3-million generated last year by Mooiplaats, the sale of which is expected to be consummated before year-end.