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Wescoal declares force majeure on thermal coal supply to ESKOM

Coal News - Published on Thu, 25 Apr 2019

Image Source: Mining MX
Mining MX reported that ESKOM’S coal supply worries have been kicked up a notch after on mine rioting at the Vanggatfontein premises of Wescoal Holdings in Mpumalanga province have resulted in a six to eight week closure affecting up to a fifth of budgeted annual coal production. Wescoal Holdings informed Johannesburg Stock Exchange that “It has informed Eskom of a force majeure interruption to coal supply. It would suffer significant negative financial impact as a result of Vanggatfontein’s closure. The mine produces about 2.4 million tonnes run of mine per year. “Wescoal intends holding further discussions with Eskom shortly in order to address the impact of the VGF (Vanggatfontein) supply shortfall to Eskom. Other Wescoal businesses are not affected and are expected to continue deliveries of coal to Eskom as scheduled.”

The original mining contractor at VGF had run into financial trouble and was placed in business rescue proceedings. In terms of the Labour Relations Act, Wescoal transferred the 228 employees to a new mining contractor. Disputes erupted shortly thereafter. Some 228 employees which had been transferred from a mining contractor inherited at Vanggatfontein when Wescoal bought Keaton Energy in 2017 would be fired following the outbreak of violence described by the company as stoppages, strike actions and riots.

The company produced 6.8 million tonnes of run of mine coal in its 2018 financial year.

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Posted By : Sanju Moirangthem on Thu, 25 Apr 2019
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