MC Mining has announced a slight dip in run-of-mine (RoM) coal production for the quarter ending June 30, marking a 4% decrease from the same period last year at its Uitkomst colliery in KwaZulu-Natal. This downturn, as reported, results from challenging geological conditions and issues with underground equipment availability.
During this quarter, the colliery engaged in a trial of a coal marketing exclusivity agreement with Paladar starting May 1. Under this agreement, Paladar agreed to pay 90% of the $87 per ton sales price within a week of production, with the remaining balance due within 30 days.
Despite these operational challenges, the Uitkomst colliery reported sales of 62,274 tons of high-grade duff and peas coal, which includes transactions with Paladar, along with an additional 10,099 tons of middlings coal throughout the quarter.
By the quarter’s end, following the sales agreements with Paladar, the inventory of high-grade coal at the colliery stood at zero. The trial period with Paladar concluded on July 31 without extension.
Looking ahead, MC Mining is focusing on the development of its Makhado project, which is poised to elevate the company as a leading producer of steelmaking hard coking coal (HCC) in South Africa. The project heralded as a significant strategic asset, is anticipated to boost the company’s production to over 800,000 tons per year of steelmaking HCC, promising substantial returns for shareholders.
The company continues to seek funding and advance development efforts for the Makhado project. Additionally, mining rights for the Greater Soutpansberg projects, specifically the Mopane and General project areas, were previously secured, and during this quarter, the mining right for the Chapudi project area was executed. Environmental and water-use license studies for these areas are expected to begin in the latter half of this year.
Operations at the Vele site remain suspended, adding another layer of complexity to the company’s operational outlook.
Source: Mining Weekly
