Power utility Eskom would need two-billion tons in new coal supplies to meet the demand of its current and planned coal-fired power stations over their operational lives, said chief commercial officer Dan Marokane last week.

Eskom estimated that about 15 new coal mines, mainly in the Mpumalanga area, would have to come on line in the next two to four years and that R100-billion would have to be invested in the domestic coal mining industry over the next seven years.

Speaking at the Coaltrans conference in Johannesburg, Marokane said that a lack of progress in developing new coal mines in the past four years had placed the utility’s coal supply under pressure.

He also said Eskom was in direct and indirect competition with South African coal exports. “We need a good balance in terms of growing our coal export market and securing coal-fired power domestically,” Marokane emphasised.

Coal quality was also impacting on Eskom, with the quality of resources left in the Mpumalanga province, where most of the power stations are located, not being as good as what was traditionally mined.

Marokane said coal mine developments should be accelerated in the Waterberg, which is known for its large coal reserves.

Eskom is currently working with State-owned logistics company Transnet Freight Rail on the construction of a heavy haul rail link between the Waterberg and power stations in Mpumalanga.

Marokane estimated that the infra- structure could cost anything between R10-billion and R40-billion, depending on the volumes of coal that would have to be transported.

To watch a video in which Eskom chief commercial officer Dan Marokane discusses the utility's future coal demands, click here.

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