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RSG - Resource Generation Limited - Resource Generation secures water for

Release Date: 09/12/2011 09:10:07      Code(s): RSG
RSG - Resource Generation Limited - Resource Generation secures water for       
stage 2 of its Boikarabelo mine                                                 
Resource Generation Limited                                                     
ACN 059 950 337                                                                 
(Incorporated and registered in Australia)                                      
(Registration number ACN 059 950 337)                                           
Share code on the JSE Limited: RSG      ISIN: AU000000RES1                      
Share code on the Australian Stock Exchange Limited: RES ISIN: AU000000RES1     
("Resource Generation")                                                         
ASX Release                                                                     
Resource Generation secures water for stage 2 of its Boikarabelo mine           
Resource Generation Limited, which is developing one of South Africa`s largest  
remaining coal deposits, has signed an agreement with the Lephalale Local       
Municipality (LLM) in Limpopo Province which will secure the water required     
for stage 2 of the company`s planned Boikarabelo mine.                          
Under the contract, which is subject to a number of conditions, the company     
will construct, operate and maintain a wastewater treatment plant at Marapong,  
approximately 50 kilometres from Boikarabelo. This will treat municipal         
effluent and generate up to 16 megalitres of water per day, which will be       
pumped to the mine site via a new pipeline.                                     
Resource Generation has been working with LLM for two years on plans for the    
plant, which will provide LLM with essential infrastructure. This is a key      
responsibility which the company`s black empowered subsidiary, Ledjadja Coal    
(Pty) Limited, committed to undertake as part of its social and labour plan     
for the Boikarabelo mine.                                                       
Sufficient water for stage 1 of the mine is available from groundwater          
boreholes on the mine properties that the company already owns.  Use is         
subject to receiving an Integrated Water Use Licence which was applied for in   
January 2011 and is expected to be received shortly.                            
Paul Jury, Resource Generation`s managing director, said: `This agreement,      
which follows two years` cooperative work with LLM, is another significant      
step in the development of our Boikarabelo mine.  The plant will provide        
sufficient water to meet the medium- and long-term needs of the mine,           
including after the stage 2 expansion; importantly it will also provide the     
local municipality with essential infrastructure and environmental protection.  
This is the first of many activities we will be undertaking for the Limpopo     
The key terms of the agreement with LLM are as follows:                         
*    The term of the agreement is 30 years from the date of grant of the water  
use licence by the Department of Water Affairs, subject to satisfaction     
    of a number of conditions.  The conditions include an environmental         
    impact assessment being approved by relevant government departments by 28   
    February 2013, sufficient power supply being secured by LMM, and all        
other required government approvals (including NEMA approval) being         
    obtained by 28 February 2013. An extension of time is possible should       
    delays be experienced.                                                      
*    Resource Generation will pay for the Marapong wastewater treatment plant   
upgrade works and expansion works to extend capacity to 4 megalitres per    
    day by January 2014, increasing to 16 megalitres per day by January 2017.   
    It will also construct the Marapong -Boikarabelo effluent transfer pump     
    station and associated works including the transfer pipeline.               
*    Resource Generation will manage, operate and maintain the treatment plant  
    after the expansion at its own cost until the operations transfer date,     
    which is one year after completion of the expansion works. At that time     
    LLM will become responsible for management, operation and maintenance of    
the plant.                                                                  
*    From 1 January 2014, the Boikarabelo mine will be supplied with a minimum  
    of 4 megalitres of treated effluent per day and from 1 January 2017 a       
    maximum of 16 megalitres per day.                                           
*    From the operations transfer date, Resource Generation will continue to    
    pay for the operation and maintenance costs. The company will also pay      
    for insurance for the plant for the term of the agreement.                  
Sydney, Australia                                                               
9 December 2011                                                                 
Paul Jury, Managing Director on (02) 9376 9000 or                               
Steve Matthews, Company Secretary on (02) 9376 9000                             
Media enquiries                                                                 
Anthony Tregoning (02) 8264 1000                                                
Deloitte & Touche Sponsor Services (Pty) Limited                                
Resource Generation is developing the Boikarabelo coal mine in the Waterberg    
region of South Africa where there are probable reserves of 744.8 million       
tonnes of coal on 35% of the tenements under its control.                       
Date: 09/12/2011 09:10:07 Supplied by www.sharenet.co.za                     
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