Waterberg completes Eskom’s feasibility study for open cast coal mining operations

6 February 2014 (Last Updated February 6th, 2014 18:30)

The Waterberg Coal joint venture partners (WCJVP) has completed a feasibility study into the development of an open cast mining operation to produce coal for South African state-owned energy provider Eskom.

The Waterberg Coal joint venture partners (WCJVP) has completed a feasibility study into the development of an open cast mining operation to produce coal for South Africa's state-owned energy provider Eskom.

The study was carried out to produce 10 million tonnes per annum over an initial term of 30 years, pursuant to the memorandum of understanding (MoU) signed previously for the proposed coal supply agreement.

The study will remain confidential until WCJVP completes its update, then it will be released as a full bankable feasibility study.

Eskom is also anticipated to test the project's coal quality over the next 30 days as part of the CSA, the discussions of which were well-advanced.

Eskom has already taken delivery of about 200,000t of bulk sample product for a burn tests.

The coal project featured 3.88 billion tonnes of coal, 2.07 billion tonnes of which fell into the measured category with mining rights garnered for more than 2.05 billion tonnes.

The company has entered into a letter of intent with its preferred engineering, procurement and construction contractor Ardbel for the proposed development of the Waterberg coal project.

The Waterberg project features eight coal tenements totaling 7,979ha.

In 2013, Waterberg Coal revealed resource results of the project that covers the properties of four farms, which includes Smitspan, Massenberg, Hooikraal and Minnasvlakte, as well as the two farms held under a prospecting permit in Vetleegte and Swanepoelpan.

Coal resources for the four farms held under the mining rights are 3.149 billion tonnes, of which 2.053 billion tonnes are a measured resource, 575.6 million tonnes are indicated and 519.5 million tonnes are inferred.

The coal resource for the two farms held under the prospecting permit is 734 million tonnes, of which 16.4 million tonnes are a measured resource, 280.7 million tonnes are indicated and 437.2 million tonnes are inferred.

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