A voluntary strategic and operational SENS update from Wescoal earlier this year indicated that production from Khanyisa colliery is subject to consents from the DMR.

JSE-listed Wescoal is pleased to announce that these consents have been granted by the Department of Mineral Resources (DMR).

Mining activities have commenced in the Khanyisa “Catwalk” as well as the adjacent Khanyisa “Triangle” areas near Ogies in Mpumalanga -collectively known as the Khanyisa complex.

This is a significant milestone in Wescoal’s expansion programme.

Wescoal CEO, Waheed Sulaiman

Production from the enlarged Khanyisa complex will ramp up to 100 000 ROM tpm over the next six months.

Khanyisa Catwalk is wholly-owned by Wescoal while Khanyisa Triangle is 100% owned by Aztolinx, an incorporated joint venture vehicle in which Wescoal owns 35%.

The Aztolinx initiative is 85% black-owned and is in line with Wescoal’s commitment to transformation and empowerment.

Wescoal CEO, Waheed Sulaiman says significant operational synergies between the two operations will be unlocked, allowing the Khanyisa complex to be mined more efficiently while extending the mine life to more than five years.

Mining activities will be managed by Wescoal with a ROM production target of 100 000 tpm within six months. Crushing and screening activities have been contracted to Mwelase Mining, a 100% black-owned company.

Aztolinx will oversee marketing initiatives. Short-term off-take agreements have been put in place while longer term contracts are being negotiated with various parties.

The Khanyisa complex is close to both Kendal and Kusile power stations, as well as Kendal siding and the Richards Bay export rail network.

These factors, coupled with the majority black ownership component, augurs well for securing favourable long term coal supply contracts in various markets including Eskom, the non-Eskom domestic and export coal markets.

Management’s priorities remain to strive for safe and reliable operations, solid and predictable financial performances, re-alignment of the trading business to Wescoal’s needs and to maximise value from the existing asset base.

Planning and executing projects in a conservative, risk-based manner will continue to form the basis on which Wescoal will manage and realise value from its growth plans.

The company remains an active participant in the consolidation of the domestic junior coal mining sector with respect to reviewing value enhancing opportunities.

All images courtesy of Wescoal