Tuesday, 22 Nov 2011
African focused coal mining investment and production company Continental Coal Limited provide an update on operating and financial performance at its thermal coal mining and processing operations in South Africa and background on the strategic acquisition of the Wolvenfontein Coal Project.
Ferreira Coal Mine and Delta Processing Operations
During the month of October 2011, ROM coal production of 69,228 tonnes at the Ferreira Mine was achieved, 13% above the average monthly ROM production in the previous quarter. The Delta Processing Operations washed a total of 81,642 tonnes for the month.
Railings to the Richards Bay Coal Terminal from the Company’s Anthra Rail Siding for the month totaled 64,191 tonnes of high quality export thermal coal. This represents a 47% increase on the average monthly tonnes railed to RBCT during the previous 2011 quarter.
Vlakvarkfontein Coal Mine
During the month of October 2011, the Vlakvarkfontein Coal Mine achieved ROM coal production of 102,796 tonnes a 9% increase on the average monthly tonnes of ROM production in the September 2011.
Thermal coal sales from the Vlakvarkfontein Coal Mine to the South African domestic market of 117,122 tonnes of thermal coal were made during the month. This was approx. 9% below the record average monthly sales of 128,148 tonnes of domestic sales achieved in the previous quarter.
Wolvenfontein Coal Project
The Company’s South African subsidiary Continental Coal Limited has executed a Sale Agreement with South African based Universal Pulse Trading (Pty) Limited and completed the acquisition of a 100% interest in the Wolvenfontein Coal Project for total consideration of ZAR 10.4 million payable in equity.
The Wolvenfontein Coal Project is located approx. 80km east of Johannesburg and 4km south of the town of Delmas in the Nkangala District Municipality, Mpumalanga Province. The Company’s Vlakplaats Coal Project, which has total JORC compliant resources of 187.7 million tonne is located less than 5km to the east.
Key points:
1. Run of mine thermal coal production of 172,024 tonnes achieved at the Ferreira and Vlakvarkfontein Coal Mines for the month of October 2011 in line with annual target of 2 million tonne per annum
2. Ferreira Mine and Delta Processing Operations achieve record monthly run-of mine coal production and record high quality export thermal coal sales for the month of October
3. Ferreira and Vlakvarkfontein Coal Mines generate unaudited aggregate EBITDA of ZAR 10.1 million for the month of October and ZAR 38.9 million for the first 4 months of the financial year
4. Acquisition of the Wolvenfontein Coal Project, which has a JORC compliant resource of 36.7 million tonne and is strategically located to the east of the Company’s Vlakplaats Coal Project
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