ASX-listed coal development firm Resource Generation’s South African Boikarabelo project in the Limpopo province will be set back by up to six months after contractor Protech Kuthele went into business rescue proceedings.

PK was undertaking the earthworks for the rail link, the site infrastructure and the roads. It has removed all staff from the mine site and terminated all activities.

“Addressing this unforeseen development is expected to delay the completion of the project by three to six months, with first coal production now estimated for the first half of 2016. Based on the previous competitive tender process, Resource Generation does not expect any difficulty in appointing an alternative earthworks contractor for a similar cost,” the company said in a statement.

Funding negotiations still continue with proposed debt financiers of the mobile equipment, the coal handling and preparation plant and the rest of the site infrastructure.

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