Photo by: Duane Daws
PERTH (miningweekly.com) – ASX-listed junior Universal Coal has sold its first coal from its Kangala mine, in South Africa’s Witbank coalfield.
The miner has processed and stockpiled the run-of-mine (RoM) coal mined from Kangala since February. Coal sales to South African power utility Eskom have now started.
Universal reported on Monday that under the terms of the original coal sales agreement, Universal would provide Eskom with sales from Kangala for the next eight years, with an extension in place for 16 years.
The Kangala project was scheduled to produce about 200 000 t/m by March this year.
Remaining production would target the more lucrative export markets, through a 100 000 t/y offtake agreement with South African coal producer Exxaro Resources.
First export sales were on track to start by July 2014, and Universal had already secured export allocation through Richards Bay Coal Terminal, in KwaZulu-Natal.
The company said on Monday that Kangala was ramping up towards its nameplate capacity, and was expected to reach this target by the third quarter of 2014.
Cash flow from Kangala would assist with funding the development of the company’s next operation, the combined New Clydesdale colliery/ Roodekop project.