CANYON Coal said it expected to commission the first phase of a R1.4bn new coal mining development called Gugulethu in the second half of this calendar year.
The mine, formerly known in the industry as De Wittkrans, is situated near Hendrina in South Africa’s Mpumalanga province. It will produce a total of 2.4 million tons (Mt) annually of which 1.2 million tons (Mt) a year will be export quality 5,500kc NAR coal.
Production from Gugulethu will replace output from Canyon’s Phalanndwa Colliery in Delmas due to close later this year. Gugulethu will access Phalanndwa’s export entitlement capacity at Richards Bay. Canyon Coal also exports coal via Maptuo in Mozambique.
Phase one of the project will access an open pit mine containing mineable reserves of 14.3Mt run-of-mine coal. It comprises three pits one of which has been designed to gain access to an underground reserve as a phase two development.
In terms of capital, the open pit will require expenditure of R600m with the balancing R850m spent in order to develop the underground section which is due to begin in 2028. Overall, the project has a 20 year life of mine.
The construction of Gugulethu’s open cast will create more than 200 jobs, with a priority given to residents of the host community. In total, the mine will create 430 jobs when it is fully operational, the company said today.
“We are in the development phase and have already done the tenders for the civils and the processing plant,” said Gugulethu Colliery GM, Jarmi Steyn in a statement. “I want to see it become a flagship site for Canyon Coal.”
