MC Mining to negotiate EPC contract for Makhado with Chinese outfit

MC Mining (MCM) has signed a heads of agreements with China Railway International Group (CRIG) which may lead to the Chinese firm providing engineering, procurement and construction (EPC) of MCM’s Makhado hard coking and thermal coal project.

Located in the Limpopo province, Makhado is expected to cost about $80m to develop and is expected to be a major provider of employment and commercial activity in an area where industrial development is uncommon. “This is an extremely positive move as it represents international recognition for the world class nature of the Makhado Project,” said David Brown, CEO of MCM in a statement.

Under the terms of the agreements, MCM and CRIG will negotiate the development of the coal handling and processing plant as well as financing for 85% of the EPC costs and contract mining operations.

However, this is conditional upon the finalisation of terms and conditions by June 2019, including completion of the Makhado front end engineering and design study and agreement on the EPC contract price by both parties, as well as appropriate funding provided on acceptable terms, the company said.

Off-take discussions for hard coking and export thermal coal production from Makhado are ongoing with various parties, MCM said.