Johannesburg, South Africa — MININGREVIEW.COM — 06 October 2010 – South African diversified miner Exxaro Resources Limited is keen to broaden its portfolio to include copper and iron ore, according to its chief executive officer Sipho Nkosi.
Revealing this here, he said Exxaro sees more opportunities now to grow by adding more new commodity businesses than it did during the financial crisis.
“Copper is one business that excites us, and we think it has got a good future. We are looking at various opportunities in Africa and other areas,” he added. “There are quite a lot of projects that we are evaluating in various parts of the continent," Nkosi said, declining to give details because Exxaro was still in talks with governments on potential ventures.
Apart from copper, Exxaro plans to also invest in iron and to grow its energy business.
Exxaro, whose main business is in coal, expects coal prices to stay at around US $85-90/t in the short to medium term, supported by a healthy supply-demand balance. But Nkosi said the strong rand would keep on hurting its profits, with each 10 cent move in the currency hitting its operating profit line by R30 to R40 million.
He also said he was upbeat about improvements in Transnet’s rail line leading to the export terminal at Richards Bay, with record amounts of coal reaching the terminal in September.
Nkosi said Transnet was likely to rail 70Mt next year, up from an estimate of 65Mt in 2010, but still far from meeting an expanded annual capacity at the export terminal of 91Mt.
He went on to say that Exxaro was likely to bid as part of a consortium to help build the Trans-Kalahari railway line from Botswana to Namibia. This line would enable greater coal exports in future, given Transnet’s restrictions and Exxaro’s own limited export allocation at the Richards Bay Coal Terminal.