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MC Mining's Makhado thermal coal off-take signed

Coal News - Published on Thu, 18 Apr 2019

Image Source: SteelGuru
MC Mining Limited announced the conclusion of a coal Sale and Purchase Agreement for the export quality thermal coal to be produced by Phase 1 of the Makhado hard coking and thermal coal project. The parties to the Agreement are MC Mining’s wholly-owned subsidiary, Limpopo Coal Company (Pty) Ltd and one of the world’s largest producers and marketers of bulk commodities.

The key highlights of the Agreement are

1. Sales prices shall be an API1 linked price expressed in US Dollars and will be calculated and agreed on a quarterly basis; and

2. Saleable thermal coal will be delivered to the Musina siding and sold on a free-on-rail (FOR) basis, which takes into account the actual rail and port charges.

The Agreement is subject to various conditions precedent standard for an agreement of this nature.

Mr David Brown, CEO commented “We have contracted with one of the world's largest producers and marketers of seaborne traded coal for the majority of the life of Phase 1. The signing of this Agreement is a further significant step in the advancement of Makhado. The phased development of the Makhado Project will generate a significant number of employment opportunities in the Limpopo province and the export of the thermal coal utilises previously tested logistics infrastructure. Negotiations for a composite debt and equity funding arrangement continue and we anticipate that they will be completed in 03 CY2019, with Phase 1 construction commencing later in the quarter.”

MC Mining’s subsidiary, Baobab Mining S Exploration (Pty) Ltd, is the owner of the Makhado Project and the nine-month Phase 1 construction period is expected to commence in 03 CY2019. Phase 1 will generate approximately three million tonnes per annum of run-of-mine coal from the west pit and this will undergo preliminary processing at the mine, yielding an estimated 2Mtpa of ROM coal. The resultant ROM coal will be transported and sold to Limpopo which will, with its modified plant, complete the final processing producing up to0.57Mtpa of export quality thermal coal and 0.54Mtpa of hard coking coal. Construction of Phase 2 of the Makhado Project in circaCV2022 is expected to produce 4Mtpa of ROM coal from the east and central pits resulting in some I.OMtpa of thermal coal.

Source :

Posted By : Rabi Wangkhem on Thu, 18 Apr 2019
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