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Friday, 06 November 09
NEW ASSETS WILL INCREASE COKING AND THERMAL COAL PRODUCTION
 Coal and metals processing company Coal of Africa Limited (CoAL) aims to produce 10-million tons a year of coking coal and two-million tons a year of thermal coal, when it brings its two coking coal assets, Vele and Makhado, into production alongside its Mooiplaats thermal coal mine, in Mpumalanga province.
Mooiplaats thermal coal mine started production in 2008 and is ramping up to produce two-million tons of product a year, while Vele and Makhado are expected to start production in the first half of 2010 and 2011, respectively. CoAL expects to produce a total of 12-million tons a year by 2015.
Growth and Challenges
CoAL MD Simon Farrell says that the most significant growth potential for coal lies in steel manufacture.
“The increasing global demand for steel is the biggest factor in the growth of coking coal demand. While demand for steel has fallen in the last 12 months, we are now seeing positive signs that demand from Asia is returning. The spot price for coking coal has recovered from $120/t to $160/t, and thermal coal has recovered from $55/t to $65/t,” he asserts.
Further, power generation also holds growth potential. Farrell points out that South Africa has experienced severe power shortages, like the rest of Africa, and this is set to continue unless there is investment in new power stations. This signifies increased demand for thermal coal when Eskom begins
to construct additional power stations to meet the rising domestic demand for power.
Farrell says that the biggest challenge facing the coal industry is securing rail and port
allocation. However, CoAL is in a strong position as it has secured rail and port allocation for both its thermal and coking coal products.
“At Vele and Makhado, we have a memorandum of understanding with steel producer ArcelorMittal for it to take 2,5-million tons a year to five-million tons a year of CoAL’s coking coal from Musina for consumption at its Vanderbijlpark and Newcastle steelworks,” he says.
To cater for the export market, CoAL has secured a one-million-ton-a-year allocation at Maputo, in Mozambique, and has signed an agreement with the Matola terminal to assist in its future expansion.
A feasibility study is currently under way for a new terminal that can handle a
further 10-million tons a year, taking the total CoAL allocation to potentially 13-million tons a year.
Industry Issues
Farrell says that coal markets have experienced a dramatic fall from the highs seen in early 2008 when coking coal spot prices reached $300/t and thermal reached $190/t.
He adds that the fundamentals for domestic thermal coal remain strong. However,
insufficient investment in power stations has led to South Africa suffering further power shortages. In response, Eskom has pledged R150-billion to increase power generation over the next five years, which will require thermal coal.
Further, Farrell asserts that there is a huge demand for education and technical skills development in the coal industry. CoAL has committed R10-million as part of its training and skills development programme.
“As a key stakeholder, CoAL has taken the initiative to contribute to the education and skills development through the King Mphephu Ramabulana bursary fund, which provides bursaries to members of communities in the areas where CoAL has operations. To date, 30 bursaries have been awarded in the studies of engineering, geology and medicine,” he says.
Projects
The first phase of the Mooiplaats colliery is almost complete. The total capital expenditure for the mine is R1-billion, with the first-phase development estimated at R739-million, of which R574-million has already been spent. Farrell describes bringing the Mooiplaats mine into production on schedule and under budget as a milestone for CoAL. The majority of the raw
materials sourced for the Mooiplaats mine have come from South Africa.
“At Mooiplaats, we have sufficient rail and port agreements in place to rail the coal through the Matola terminal, in Maputo, where we currently have a one-million-ton- a-year allocation. An extra two-million tons a year will come on stream in the third quarter of 2010, following the completion of a current expansion programme,” Farrell says.
Meanwhile, the company is still waiting for new-order mining rights for its Vele coking coal mine to be granted.
“Construction is expected to start in the fourth quarter of this year, and we have
already ordered key equipment for Vele to enable us to begin construction immediately
following approval.
“Vele will start production in the first quarter of 2010, and phase one of the mining
operations will be complete by the middle of 2010, producing an expected one-million tons a year. The timing of phase two is dependent on demand,” he explains.
Vele is a R3-billion project, with phase one estimated at R350-million and producing one-million tons a year, while phase two will cost R2,65-billion.
Makhado’s new-order mining rights
application will be lodged in the fourth quarter of this year, pending the Section 11
approval, and construction will start in the second half of 2010, immediately after the granting of the new-order mining rights. The project will be completed with the
option to adopt a phased model, depending on market conditions. Makhado is a R2,7-billion project.
The company currently employs about 330 people and Vele alone will generate 800 jobs in the construction phase. Farrell adds that about 28 000 direct and indirect jobs will be created when both Vele and Makhado
become fully operational.
Source:Mining Weekly
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Wednesday, 28 October 09
INVESTMENT IN MINING SECTOR HAMPERED BY LATE REGULATIONS
The Jakarta Post reported that, Indonesia may have to wait for a potential massive inflow of new investment into the mining sector due to delays in ...
Tuesday, 27 October 09
CHINA'S SEPT. COAL IMPORTS RISE AS ECONOMY RECOVERS
Bloomberg reported that, China, the world’s largest coal user and producer, increased imports of the fuel in September to meet rising domest ...
Monday, 26 October 09
DARWIN EYES PRIVATE INVESTMENT
The Jakarta Post reported that, the new energy and ministerial resources minister, Darwin Zahedy Saleh, has set his sights on accelerating the reali ...
Sunday, 25 October 09
THE FUTURE FREIGHT MARKET IS EXPECTED TO HAVE POSITIVE DIRECTION - VISTAAR
COALspot.com (Singapore): According to Vistaar Shipping an experienced ship operator in Singapore, the BDI shot up this week (19-24 October) by abou ...
Saturday, 24 October 09
NTPC SEEKS ALTERNATE COAL SUPPLY FOR KAHALGAON
State-run NTPC is looking at alternate sources of coal to fire its Kahalgaon (Bihar) and Farakka (West Bengal) and power stations, which are facing ...
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- Toyota Tsusho Corporation, Japan
- Vizag Seaport Private Limited - India
- Samtan Co., Ltd - South Korea
- Interocean Group of Companies - India
- Global Green Power PLC Corporation, Philippines
- Anglo American - United Kingdom
- Marubeni Corporation - India
- Australian Coal Association
- Bukit Makmur.PT - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Wilmar Investment Holdings
- Central Electricity Authority - India
- Chettinad Cement Corporation Ltd - India
- Madhucon Powers Ltd - India
- Wood Mackenzie - Singapore
- Georgia Ports Authority, United States
- Kartika Selabumi Mining - Indonesia
- Ministry of Finance - Indonesia
- Eastern Energy - Thailand
- Karbindo Abesyapradhi - Indoneisa
- Standard Chartered Bank - UAE
- SMG Consultants - Indonesia
- Altura Mining Limited, Indonesia
- Gujarat Mineral Development Corp Ltd - India
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- Thai Mozambique Logistica
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- Asia Pacific Energy Resources Ventures Inc, Philippines
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- Directorate Of Revenue Intelligence - India
- Sindya Power Generating Company Private Ltd
- Alfred C Toepfer International GmbH - Germany
- Minerals Council of Australia
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- Energy Link Ltd, New Zealand
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- Bhatia International Limited - India
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- Romanian Commodities Exchange
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- Meralco Power Generation, Philippines
- The State Trading Corporation of India Ltd
- CNBM International Corporation - China
- Rio Tinto Coal - Australia
- Sical Logistics Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sinarmas Energy and Mining - Indonesia
- Eastern Coal Council - USA
- SMC Global Power, Philippines
- Siam City Cement PLC, Thailand
- Carbofer General Trading SA - India
- Orica Australia Pty. Ltd.
- Coal and Oil Company - UAE
- VISA Power Limited - India
- India Bulls Power Limited - India
- Price Waterhouse Coopers - Russia
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- Electricity Authority, New Zealand
- Holcim Trading Pte Ltd - Singapore
- Ministry of Mines - Canada
- Gujarat Sidhee Cement - India
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- Sakthi Sugars Limited - India
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- Sarangani Energy Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- Manunggal Multi Energi - Indonesia
- ICICI Bank Limited - India
- San Jose City I Power Corp, Philippines
- Lanco Infratech Ltd - India
- Formosa Plastics Group - Taiwan
- Ceylon Electricity Board - Sri Lanka
- GAC Shipping (India) Pvt Ltd
- Timah Investasi Mineral - Indoneisa
- Global Business Power Corporation, Philippines
- Videocon Industries ltd - India
- South Luzon Thermal Energy Corporation
- Kapuas Tunggal Persada - Indonesia
- PowerSource Philippines DevCo
- Grasim Industreis Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Kumho Petrochemical, South Korea
- Semirara Mining Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Ministry of Transport, Egypt
- CIMB Investment Bank - Malaysia
- McConnell Dowell - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ambuja Cements Ltd - India
- Port Waratah Coal Services - Australia
- International Coal Ventures Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Indika Energy - Indonesia
- Oldendorff Carriers - Singapore
- Karaikal Port Pvt Ltd - India
- Trasteel International SA, Italy
- Indian Oil Corporation Limited
- Iligan Light & Power Inc, Philippines
- Globalindo Alam Lestari - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Bhushan Steel Limited - India
- GVK Power & Infra Limited - India
- Renaissance Capital - South Africa
- Mercator Lines Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Mintek Dendrill Indonesia
- Meenaskhi Energy Private Limited - India
- Bukit Baiduri Energy - Indonesia
- Simpson Spence & Young - Indonesia
- European Bulk Services B.V. - Netherlands
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Aboitiz Power Corporation - Philippines
- Vedanta Resources Plc - India
- Cement Manufacturers Association - India
- Deloitte Consulting - India
- Kepco SPC Power Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Posco Energy - South Korea
- Bayan Resources Tbk. - Indonesia
- Electricity Generating Authority of Thailand
- White Energy Company Limited
- Krishnapatnam Port Company Ltd. - India
- Planning Commission, India
- Bhoruka Overseas - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Asmin Koalindo Tuhup - Indonesia
- Billiton Holdings Pty Ltd - Australia
- ASAPP Information Group - India
- Power Finance Corporation Ltd., India
- Jorong Barutama Greston.PT - Indonesia
- PNOC Exploration Corporation - Philippines
- Baramulti Group, Indonesia
- TeaM Sual Corporation - Philippines
- The Treasury - Australian Government
- Salva Resources Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
- Rashtriya Ispat Nigam Limited - India
- Independent Power Producers Association of India
- Indonesian Coal Mining Association
- Coastal Gujarat Power Limited - India
- Pendopo Energi Batubara - Indonesia
- Xindia Steels Limited - India
- Tamil Nadu electricity Board
- Bharathi Cement Corporation - India
- Cigading International Bulk Terminal - Indonesia
- Intertek Mineral Services - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- AsiaOL BioFuels Corp., Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bulk Trading Sa - Switzerland
- Chamber of Mines of South Africa
- Ind-Barath Power Infra Limited - India
- Larsen & Toubro Limited - India
- Miang Besar Coal Terminal - Indonesia
- Global Coal Blending Company Limited - Australia
- The University of Queensland
- Indo Tambangraya Megah - Indonesia
- Agrawal Coal Company - India
- Latin American Coal - Colombia
- Parry Sugars Refinery, India
- Bangladesh Power Developement Board
- Petron Corporation, Philippines
- London Commodity Brokers - England
- Kalimantan Lumbung Energi - Indonesia
- Borneo Indobara - Indonesia
- Mjunction Services Limited - India
- Gujarat Electricity Regulatory Commission - India
- New Zealand Coal & Carbon
- Essar Steel Hazira Ltd - India
- Edison Trading Spa - Italy
- Bahari Cakrawala Sebuku - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- LBH Netherlands Bv - Netherlands
- Indian Energy Exchange, India
- Kideco Jaya Agung - Indonesia
- Star Paper Mills Limited - India
- Heidelberg Cement - Germany
- Economic Council, Georgia
- Malabar Cements Ltd - India
- IHS Mccloskey Coal Group - USA
- Commonwealth Bank - Australia
- MS Steel International - UAE
- Leighton Contractors Pty Ltd - Australia
- Neyveli Lignite Corporation Ltd, - India
- Medco Energi Mining Internasional
- Sojitz Corporation - Japan
- Mercuria Energy - Indonesia
- Merrill Lynch Commodities Europe
- Straits Asia Resources Limited - Singapore
- Parliament of New Zealand
- Dalmia Cement Bharat India
- PTC India Limited - India
- Singapore Mercantile Exchange
- GMR Energy Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Australian Commodity Traders Exchange
- Riau Bara Harum - Indonesia
- Energy Development Corp, Philippines
- Indogreen Group - Indonesia
- Orica Mining Services - Indonesia
- Attock Cement Pakistan Limited
- Makarim & Taira - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- SN Aboitiz Power Inc, Philippines
- Metalloyd Limited - United Kingdom
- Goldman Sachs - Singapore
- Thiess Contractors Indonesia
- Aditya Birla Group - India
- IEA Clean Coal Centre - UK
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