JOHANNESBURG (miningweekly.com) – JSE-, ASX- and Aim-listed Coal of Africa Limited (CoAL) has completed construction and started mining at its Vele colliery, following the reinstatement of its integrated water use licence.

The Vele coking coal mine in Limpopo, where construction activities were halted last year amid environmental concerns, started production in December, producing 188 000 m³ of overburden and 3 200 t of run-of-mine (ROM) coal to date.

Wet commissioning of the plant was completed in December and hot commissioning was under way, CoAL reported on Tuesday.

The Woestalleen and Mooiplaats thermal coal mines produced 794 215 t of coal in the December quarter, of which 531 506 t was export coal and 262 709 t middlings product.

ROM production from the two mines declined to 1.08-million tons, from 1.20-million tons in the September quarter.

The miner said it had resumed normal sales of export coal in the period, increasing by 87.7% from 277 499 t in the September quarter, to 520 812 t in the December quarter.

However, concerns over the European economy, larger than normal stockpiles in India and increased availability of lower-grade Indonesian coal had resulted in subdued international demand for South African coal during the quarter. Demand increased towards the end of the December quarter and the trend continued in the March quarter.

The firm sold 212 803 t of coal into the inland market, with 254 046 t of lower-quality coal from Woestalleen and 37 421 t from Mooiplaats delivered to Eskom.

Meanwhile, CoAL said it had found a buyer for its Holfontein project in the Witbank coalfield.

Govhani Consulting agreed an exclusive right to buy the project from CoAL by June 30 for R100-million and a continuing payment of R2/t of saleable coal produced by the project.

Govhani paid an initial nonrefundable deposit of R4-million to review the project and a further R5-million to finalise a definitive feasibility study.

"The December 2011 quarter yielded positive outcomes for various initiatives undertaken during the year,” said CEO John Wallington in a statement.
 

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