Coal miner Exxaro’s pledge at the 2018 South African Investment Conference (SAIC) to invest R19.54-billion in projects led to it completing seven megaprojects at operations in Limpopo and Mpumalanga, with as much as 98% of its capital expenditure having been spent with South African suppliers.

In turn, this empowered 6 712 people who were directly employed by Exxaro during the construction phase of these projects, while also indirectly impacting as many as 70 000 others who received indirect work in South Africa as a result.

Of the 6 712 people Exxaro employed, 57% were recruited from within the communities where the projects were established, while the remaining 43% were recruited from elsewhere in South Africa.

This was particularly the case with Exxaro’s digital Belfast mine, as implementing modern technologies required skills not necessarily available in the remote Mpumalanga region. At this project, 44% of those employees involved with the construction were recruited from local communities, while 56% came from elsewhere in South Africa.

Nevertheless, 78% of those involved with the Grootegeluk (GG) 6 expansion project were recruited from local communities, while 96% came from local communities for the thermal and metallurgical coal Leeuwpan life extension project.

In 2018, the miner pledged to complete nine major projects, of which it has completed seven, totalling R13.24-billion, and opted not to proceed with one project. The only outstanding project is the life extension of its Matla mine – an Eskom-funded project which remains on schedule and budget of R3.5-billion.

Exxaro projects and technology executive head Johan Meyer says that because of the maturity of the Mpumalanga-based Matla mine, the working face was significantly advanced, thereby requiring miners to travel vast distances underground before arriving for work. This presented a safety hazard and was tiring on mining personnel, as well as making mining at Matla inefficient.

To remedy the situation, Exxaro proposed establishing a new shaft nearer to the working face that would enable miners to quickly and safely reach their zones of work.

As such, Exxaro shut its Mine 1 in 2014 when it started plans to build a new shaft.

In the process of extending the life of the Matla mine, Exxaro is awaiting additional funds from Eskom, which will take the mine to 2048 and ensure it meets the Matla Power Station coal supply agreement requirement of ten-million tonnes a year. This project is likely to be completed by 2025.

Meanwhile, putting a R2.8-billion dent in its overall R19.5-billion investment pipeline announced in 2018, Exxaro exited its proposal to build the 630 MW Thabametsi independent power station in Limpopo.

“The independent power producer journey was stopped because of financial constraints that we have in building new coal-fired power stations,” he says.

COMPLETED PROJECTS

Since Exxaro’s 2018 SAIC pledge, the miner has spent R5.3-billion on expanding its GG operation – through the GG6 expansion project – to increase its production of semi-soft coking coal by converting its existing GG 2 plant single-stage beneficiation plant to a double-stage beneficiation complex.

For its newest addition – the Mpumalanga-based Belfast mine, Exxaro spent R3.3-billion on building a fully-digital mine that produces A-grade thermal coal for the export market, as well as low-grade power station coal over a seven-year life-of-mine.

“For the life of Belfast, it contributes [about] R2-billion [a year] into that community, whether it is paying taxes, salaries [or] partners that work together to make Belfast work,” says Meyer.

The miner also invested R1.9-billion on extending the life of its Mpumalanga-based Mafube thermal coal joint venture operation with Anglo American, R1.3-billion on commissioning a rapid load-out rail station at GG, R600-million on backfilling the openpit mine at GG and R500-million on extending the life of its Leeuwpan operation by 12 years.

In terms of health and safety, Exxaro completed the GG rapid load-out station project without a lost-time injury being reported, while the entire GG mining operation has been fatality-free for five years, despite various construction projects involving third-party contractors who had to be on-boarded, safely inducted and managed.

The discards and backfilling project at GG ensures Exxaro starts rehabilitating the mine, starting from its earliest entry point into the openpit and progressing forward as the mine progresses.

Further, as part of its total 2018 SAIC pledge, Exxaro also spent R340-million on doubling plant capacity of its Centeral Seam 4 to 400 t/h and extending the life of that mine by 15 years.

As for the future, Exxaro plans to embark on driving GG towards being a responsible and sustainable mine through reducing its carbon intensity using external and renewable energy sources, as well as increasing the mine’s contribution to society.

In addition, Exxaro plans to shift into alternative revenue streams by augmenting coal-derived revenue with other revenue streams to create new job opportunities.