Universal completes third colliery buy
PERTH (miningweekly.com) – South Africa-focused Universal Coal has completed the A$8.9-million acquisition of the North Block Complex from South Africa’s Exxaro Coal.
The North Block Complex is an opencast operation located in proximity to South African State-owned utility Eskom’s Arnot, Tutuka and Komati power stations. It has historically achieved average run-of-mine (RoM) production of about 3.5-million tons a year over the past four years with sales of about 2.7-million tons a year.
The operation will be converted into a multi-product operation with the inclusion of the adjacent Paardeplaats project, pending regulatory approvals.
Universal CEO Tony Weber said on Monday that the early completion of the acquisition will enable the company to benefit from additional operating months in the current reporting period, and enable Universal to apply its business and operating model to the North Block Complex and to restore production levels to those historically achieved.
“Given that we have completed this transaction well ahead of schedule, Universal is on track to deliver and exceed the estimated forecast earnings before interest, tax, depreciation and amortization of A$93.1-million,” said Weber.
“We are exceptionally well placed to deliver on production and sales volume commitments for 2019.”
He noted that the inclusion of the North Block Complex to Universal’s portfolio of assets would significantly increase the company’s projected saleable product pipeline by adding an additional 2.7-million tonnes a year of production.
The North Block Complex is jointly held with Ndalamo Resources, which holds a 51% stake in the project, with Universal holding the remaining 49% stake and acting as manager.
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