South African Coal Mining Holdings Limited
(Incorporated in the Republic of South Africa)
Registration number 1994/009012/06
Share code: SAH ISIN: ZAE000102034
(SACMH or the company)
Proposed suspension of mining operations
Shareholders are advised that SACMHs subsidiary, Umlabu Colliery Proprietary Limited
(Umlabu), has arrived at a point where the company has taken a decision to suspend
mining operations and place the mine on a care and maintenance programme. The reasons
are inter alia as follows:
* Reserves at the Mooifontein section of the colliery currently being mined will be
depleted by the end of December 2012.
* The company had planned to access the Voorslag reserve by now. However, approval
of the Water Use Licence Application (WULA) for the area has not been received and
consequently mining operations cannot be started. Numerous interactions have taken
place and additional studies and updates required have been submitted to the
Department of Water Affairs over the last two years.
* The global market prices of seaborne thermal coal have plummeted during this year.
Consequently the company has been recording significant losses, as disclosed in its
recent interim report. The Companys cost of production is in excess of the current
market prices and the Company cannot sustain the operations and continue to incur
Consequently the National Union of Mineworkers has been informed on 24th October
2012 that Umlabu contemplates the retrenchment of 64 employees. Consultations in
terms of the Labour Relations Act will commence on a date to be determined by the
Commissioner of the Commission for Conciliation, Mediation and Arbitration which
has been requested to facilitate the process.
Further announcements will be made in due course to keep shareholders abreast of
24th October 2012
Date: 24/10/2012 03:54:00 Supplied by www.sharenet.co.za
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