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Investigation of underexplored coalfields under way
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11th March 2011
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A study is currently under way to investigate under- developed coalfields in South Africa and to estimate the quantities of coal that may still be available for mining.

The study is being undertaken by Venmyn, a specialist adviser in minerals project valuation and statutory compliance to the international minerals industry and investors. The company aims to provide its clients and interested parties with an easily understood overview of the country’s coal resources.

The research is being compiled from various reports. Venmyn has completed reports on the Springbok Flats and Limpopo coalfields and is currently compiling a report on coalfields in the Free State, namely the Free State and Sasolburg coalfields, as well as the South Rand coalfield, on the Free State border.

“In the Free State, coal was deposited in glacial channels that now pose challenges to mining. “These channels can be between 5 km and 12 km in width and need high-tech exploration to delineate the hills and valleys created by the channels to improve efficiency and accuracy in locating mineable coal deposits,” explains Venmyn coal and energy consultant Paul White.

He says that, while South Africa has 19 identified coalfields, there are only about seven working coalfields in the country, as many are underexplored or have not been mined at all.

“The coalfield in the Spring-bok Flats is huge and has never produced coal. “While it is amenable to mining, the coalfield contains uranium and there are concerns about whether coal containing uranium can be burned or if the uranium can be extracted from the coal. “The Department of Energy is starting to look at this coalfield as it potentially holds billions of tons of coal,” says White.

The Limpopo coalfield generally hosts a higher-grade coal fraction containing coking and semicoking coal, in addition to steam coal. The greater part of the Lim- popo coalfield extends into Zimbabwe. The coalfield contains a valuable percentage of coking coal, which is important for the country’s metallurgical and steel industries.

“Currently, South Africa imports two-thirds or more of the coking coal used by steel producer ArcelorMittal Steel South Africa. “It will be to the country’s benefit to produce coking coal,” adds White.

The research also aims to asses the relationship between the country’s imperative to earn foreign earnings and its ability to generate coal to produce energy.

“State-owned power utility Eskom can burn coal that can probably not be burnt by any one else in the world. “The exploitation of South Africa’s underexplored coalfields will provide the country with a lot of latitude as we can remove the high-quality fraction to produce coking coal, the middlings fraction for power generation and a low-grade fraction that, in some cases, can be upgraded for use in power stations,” explains White.

Further, he says that there is a current debate concerning whether coal should be burnt, gasified or used to produce liquid fuels.

“However, South Africa has to burn coal if it wants energy. I believe that South Africa will be dependent on coal for a long time,” adds White.

South African Mining Environment

Venmyn MD Andy Clay says that coal is a strategic mineral worldwide. Many of the company’s current clients are from India and are looking to secure coal supply for India’s power stations.

However, he believes that the regulatory environment in South Africa has become difficult.

“Venmyn has just returned from the Mining Indaba, held in Cape Town, and the overall message is that there are significant challenges in terms of regulatory approvals and the ability to work with governments, particularly the South African government, in terms of mineral projects,” says Clay.

He explains that the big consumers of resources are looking to Africa to source the bulk commodities, such as iron-ore, coal and manganese. However, if there is a challenging environment for mining, consumers and investors are likely to take their business elsewhere.

“South Africa is presenting itself as an environment in which it is too difficult to conduct business. “There are many attractive mineral projects in West and East African countries, while infrastructure development is also moving forward. “Mozambique’s railway infrastructure is expected to open up significantly over the next five to ten years. “With the right infrastructure, East and West African projects will prosper, with the Chinese and the Indians prepared to build the needed infrastructure,” says Clay.

He points out that the biggest challenge faced by South Africa is inadequate rail and port facilities.

“The Indians and Chinese have made known their intention to come in and take control of South Africa’s local railway lines and ports. “These countries are willing to build the infrastructure that the South African government has not yet provided. However, the South African government has yet to take advantage of this offer,” concludes Clay.

Edited by: Brindaveni Naidoo

 

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Venmyn energy and coal consultant Paul White and MD Andy Clay discussing the company's investigation into underexplored coal mines in South Africa. Cameraperson: Nicholas Boyd. Editing: Darlene Creamer.
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