JOHANNESBURG (miningweekly.com) – Thermal coal junior Continental Coal on Wednesday said it had started blasting activities to construct the twin decline development at its Penumbra mine, near Ermelo, in Mpumalanga.

Development activities at the mine had accelerated significantly since the start of the year, following the mobilisation of civil engineering firm Murray & Roberts (M&R) in December, to construct the development of the twin declines.

M&R completed the mobilisation of all the major decline development equipment to the Penumbra mine site on January 16, with construction of the site office now also complete. The necessary concrete slabs, offices, change house and workshops had been established, ahead of the development of the twin declines.

“The temporary power supply, in the form of a diesel generator and compressor, had also been installed, ready for the decline development,” the miner reported in a statement.

Preparation of the twin declines, comprising the belt and the travelling roads, through the installation of spilling bolts into the perimeter of the excavations was completed in late January and early February. Drilling of the first rounds for blasting the initial two metres of advance was completed on February 4, and the first blasts in the decline took place on February 6.

“Development of the declines would now continue with blasting in the declines allowing for about 2.2 m of advance to be completed every second day in each decline, with the associated ground support completed,” the miner added.

The declines and support pillars between them would be covered with shotcrete over the initial ten metres of the declines, to ensure stability of the area for the full life of the mine.

“Once this had been completed decline development would accelerate, with blasting activities being completed on a daily basis to ensure that the project will be completed on schedule,” Continental said.

The Penumbra coal mine is forecast to produce a yearly run-of-mine (RoM) production of 750 000 t. The RoM coal produced will be beneficiated through the existing Delta processing operations, which comprises a 1.8-million-ton-a-year coal processing plant and the 1.2-million-ton-a-year Anthra rail siding.

Production of 500 000 t/y of an export thermal coal product is expected. The export thermal coal product will be transported through to the Richards Bay Coal Terminal under existing rail contracts and sold to EDF Trading and to other export off-take agreements.

Meanwhile, Continental had also executed a coal and foreign exchange hedging transaction for 664 550 t of thermal coal, at an average price of R1 057/t, a 23% premium to current prices. The price was higher than the maximum three-year price of R983/t.

Further, the miner secured a $65-million loan from ABSA Capital. Continental also announced that further satisfaction of the remaining conditions precedent to draw down $35-million had been met, and the seven-year project loan facility would now be used to fund the development of the Penumbra coal mine.
 

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