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EXX - Joint News Release - Eskom And Exxaro Sign Coal Supply Contract For Medupi Power Station Exxaro Resources Limited Registration number: 2000/011076/06 JSE share code: EXX ISIN code: ZAE000084992 ADR code: EXXAY JOINT NEWS RELEASE ESKOM AND EXXARO SIGN COAL SUPPLY CONTRACT FOR MEDUPI POWER STATION State-owned power company Eskom and diversified resources group Exxaro Resources Limited (Exxaro) today signed the coal supply agreement for Eskom`s new base-load power station, Medupi Power Station, situated at Lephalale, Limpopo province. Exxaro`s capital expenditure for the project is estimated at R9 billion and production is planned to begin in the third quarter of 2011 with a ramp-up to full production by 2014. In terms of the agreement, Exxaro`s Grootegeluk mine, will over the next 40 years, supply an average of 14,6 million tonnes per annum of power station grade coal to Medupi. The coal to Medupi will be supplied through a brownfields expansion of Grootegeluk mine with mining from the existing opencast pit continuing at an accelerated rate. The coal beneficiation process will be handled via two new dense medium facilities (Grootegeluk 7 and Grootegeluk 8 beneficiation plants) which will be constructed at the mine. "The investments by both Eskom and Exxaro will have a significant benefit to the local, provincial and ultimately the South African economy. Direct jobs created during construction by both investments will peak at about 9 500 with the Eskom investment generating 8 000 and the Exxaro investment generating 1 500 of these jobs. Furthermore, thousands of indirect jobs will also be created during the construction of the power station and the expansion of the mine," says Jacob Maroga, Chief Executive of Eskom. "We value the co-operative and long-standing relationship that has developed between Eskom and Exxaro and are pleased to be able to continue this mutually beneficial relationship," says Sipho Nkosi, Exxaro`s Chief Executive Officer. "We estimate that about 550 permanent jobs will be created at the Grootegeluk mine," added Nkosi. The technical and commercial teams have negotiated an agreement that has been ratified and approved by both the boards of both Eskom and Exxaro. Medupi is the first of Eskom`s new generation base-load coal-fired power stations and it will comprise of six 800MW generation units capable of supplying 4 800MW of generation capacity to the national grid. Medupi will be the largest air-cooled power station in South Africa and its first generation unit is scheduled for commercial operation during the last quarter of 2011, with the last unit expected to be in operation in the first half of 2014. ends Editor`s Notes: Exxaro Exxaro is one of the largest South African-based diversified resources groups, with interests in the coal, mineral sands, base metals, industrial minerals and iron ore commodities. The group is the largest supplier of coal to Eskom and currently also supplies the Matimba power station with about 14,6Mtpa of coal from its Grootegeluk mine. www.exxaro.com Eskom and the Medupi Power Station Eskom, the state owned electricity utility, is in the process of a major capital expansion programme to ensure the sustainability of supply of electricity. The Medupi sod-turning celebration was held in August 2007 and since then site work has proceeded as scheduled. The boiler contract was awarded to Hitachi Power Africa in October 2007 and the turbine order has been placed with Alstom S&E. Enquiries Exxaro: Eskom: Trevor Arran Fani Zulu Executive General Manager: Senior General Manager: Corporate Affairs & Strategy Group Communications Tel: +27 12 307 3292 Tel: +27 11 800 2265 Mobile: +27 83 609 1444 Mobile: +27 82 451 0457 E-mail: trevor.arran@exxaro.com Email: fani.zulu@eskom.co.za Ernst Venter Executive General Manager: Business Growth Tel: +27 12 307 4322 Mobile: +27 83 609 1313 E-mail: ernst.venter@exxaro.com 19 September 2008 Sponsor: J.P. Morgan Equities Ltd Date: 19/09/2008 10:00:01 Supplied by www.sharenet.co.za Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.
