https://www.miningweekly.com

CoAL to place Mooiplats on care and maintenance

3rd June 2013

By: Natalie Greve

Creamer Media Contributing Editor Online

  

Font size: - +

JOHANNESBURG (miningweekly.com)– ASX-, Aim- and JSE-listed Coal of Africa Limited (CoAL) on Monday announced the closure of its Mooiplaats Colliery, affecting 290 workers and 258 contractors.

The company said the care-and-maintenance decision followed sustained and concerted, but unsuccessful, attempts over the past two financial years to make the operation profitable and enable it to produce positive cash flows.  

Mooiplaats – one of CoAL’s three operational collieries – recorded a loss of R167-million for the financial year ended June 30, 2012, and had generated an average monthly loss of R20-million since the beginning of the current financial year.

CoAL chairperson David Brown said the company’s efforts to improve productivity and establish profitable operations at Mooiplaats, which included capital investment, had been hampered by the global downturn in thermal coal prices in the last year.

“This situation has been exacerbated by the inability of the colliery to ramp up production to achieve required targets, owing to poor operational performance and challenging geological conditions,” he said in a statement.

The mining firm would now embark on a regulatory Section 189A process with stakeholders, which would involve a two-month consultation period to evaluate possible alternatives.

Brown said that, while the decision to cut jobs had not been taken lightly, the company needed to preserve its financial structure and ensure its future sustainability.

The company’s cash position on March 31 was $67.4-million.   

Further, CoAL had an allocation of three-million tonnes in Maputo at the Matola Terminal, and was working to mitigate the take-or-pay exposure.

Edited by Mariaan Webb
Creamer Media Senior Deputy Editor Online

Comments

The functionality you are trying to access is only available to subscribers.

If you are already a subscriber, you can Login Here.

If you are not a subscriber, you can subscribe now, by selecting one of the below options.

For more information or assistance, please contact us at subscriptions@creamermedia.co.za.

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION