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Now Wescoal receives Eskom force majeure

21st April 2020

By: Martin Creamer

Creamer Media Editor

     

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JOHANNESBURG (miningweekly.com) –  Coal mining and marketing company Wescoal on Tuesday became the second JSE-listed coal-mining company to report that it had received a force majeure notification from State coal utility Eskom to halt supply temporarily.

The first company was coal mining company Exxaro, which said it would be vigorously contesting the Eskom notice that it would not be taking the full contractually agreed tons of coal until a month after the lockdown.

Eskom has agreements in place for the supply of coal to the Medupi and Matimba power stations.

Mining Weekly can report that Wescoal shareholders were advised in a stock exchange news service (SENS) announcement that on April 17, Eskom Holdings State Owned Enterprise Limited served Wescoal with letters calling force majeure on the coal supply agreements in place for the supply of coal to their power stations.

Wescoal said in the SENS announcement that the letters it received indicated that this notification was applicable until one month after the Covid-19 national lockdown had been completely lifted.

Wescoal said that the effect of these indications was that Eskom would not necessarily be taking the full contractually agreed tons of coal from Wescoal’s operations for that period.

The company said it would update the market should there be any material impact on its coal supply agreements with Eskom.

Wescoal is a coal-focused mining company incorporating mining, processing, selling and distribution of coal and coal-related products.

It has the Elandspruit, Khanyisa and Vanggatfontein collieries and last year acquired a 50% interest in the mine from Exxaro.

Edited by Creamer Media Reporter

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