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Makhado Definitive Feasibility Study
Coal of Africa Limited
Incorporated and registered in Australia)
(Registration number ABN 008 905 388)
ISIN AU000000CZA6
JSE/ASX/AIM share code: CZA
("CoAL or the "Company" or the "Group")
ANNOUNCEMENT 19 June 2013
Makhado Definitive Feasibility Study delivers robust economic returns and provides a platform to turn CoAL
into a significant global hard coking coal and thermal coal producer
Coal of Africa Limited (the Company or CoAL) is pleased to announce the results of a Class II(1) Definitive Feasibility
Study (DFS) at its flagship Makhado coking coal project (Makhado). Makhado is CoAL's anchor project in the
Soutpansberg coalfield, Limpopo Province of South Africa, where CoAL has access to a significant hard coking and
thermal coal resource, with the estimated gross tonnes in situ in the order of 8 billion tonnes(2).
Highlights of the Makhado DFS include:
- 12.6 million tonnes per annum (Mtpa) Run of Mine (ROM) which is expected to produce 2.3Mtpa of hard coking
coal and 3.2Mtpa of thermal coal.
- Favourable Internal Rate of Return (IRR) of 30.1% (unleveraged) and a Net Present Value (NPV) of R6.79billion
(US$697m) at a real discount rate of 8%.
- Mineable tonnes in-situ (MTIS) 344.8 million tonnes (Mt).
- 16 year Life of Mine (LOM) at a mine average gate cost of R865.00 (US$88.71) per saleable hard coking coal
tonne (after thermal coal by- product credit).
- Capital expenditure of R3.96 billion (bn) (US$406.3m) including contingency.
- Non-discounted peak funding requirement is R4.2bn (US$432.8m).
- Makhado has a hard coking coal (HCC) producing a metallurgical coke with a high coke strength after reaction
(CSR) value above 60.
- The Makhado Project benefits from excellent existing infrastructure with respect to rail, road, power and port
allocation.
The DFS was undertaken by CoAL with the assistance of a number of leading independent industry consulting firms.
The DFS defined a 16 year LOM, with mining expected to take place at an average rate of 12.6Mtpa ROM in order to
produce 2.3Mtpa of hard coking coal and 3.2Mtpa of thermal coal, at a steady state. The resource will be mined on an
opencast basis with the potential for expansion into underground.
The full announcement and accompanying presentation with graphics is available from the Companys website www.coalofafrica.com.
(1) Class II (Feasibility): Being that studies and estimates of variables are detailed in nature. Capital cost estimates
are required in the range - 10% to +15% and the contingencies applied being 8% - 12%. The purpose of this study is to obtain funding.
(2) 8 billion of gross tonnes in situ representing 795.6Mt for Makhado and 7.2 billion tonnes for CoAL's other projects in the Soutpansberg Coalfield.
David Brown (Chairman) commented:
"We are delighted to announce the results of our Feasibility Study on our flagship, Makhado Project.
This high quality hard coking coal project will not only deliver robust economic returns but also contribute meaningfully
to the economic development of the Limpopo province in South Africa. Makhado further provides South Africa with a
new coking coal producing asset in the region, utilising established infrastructure for domestic and international
markets. The Makhado Project represents the future of the Company and is the first step in the development of a
major 8 billion tonne resource across our Soutpansberg Coalfield. We have now embarked on the financing stage of
the Makhado Project and have already commenced discussions with both potential Black Economic Empowerment (BEE) groups,
including our communities and strategic partners. We are working towards a funding structure which will include debt
funding, whereby CoAL retains majority ownership with the incoming partner's contribution meeting CoAL's full equity
requirement for the Project. Our regulatory approval and funding requirements are targeted to be completed by H1CY14."
Resources
Makhado is located in the Tshipise South subdivision of the Greater Soutpansberg Coalfield. Within the project area, a
number of coal seams occur within a 30m to 40m thick carbonaceous zone of the Madzaringwe Formation.The seams
dip northwards at approximately 12°.
The Soutpansberg Coalfield was extensively explored by Iscor in the 1970s and 1980s. CoAL purchased Iscor's
dataset in 2007 and in the same year started prospecting and exploration drilling. Up until 2012, out of a total of 506
boreholes, CoAL has drilled a total of 214 boreholes, within the Makhado Project area.
Of the 214 boreholes drilled by CoAL, 172 boreholes were diamond core. In addition, 24 Large Diameter Drilling
(LDD) boreholes, 13 open-hole or percussion holes and 5 geotechnical holes were drilled.
Aerial magnetic and radiometric surveys have also been undertaken.
Between August 2010 and April 2011, CoAL excavated a boxcut on the farm Tanga 849 MS. From this 45,849 tonnes
(t) of ROM has been processed, producing 21,800t of coal, some of which was transported to Exxaro's Tshikondeni
Coking Coal Mine for process testing. This bulk sample was excavated in order to confirm the hard coking coal
qualities and coking product quantities, and to test various processing options for the coal.
The Coal Resource estimate is based on all available historical and recent drilling and other geological information as
of 31 August 2011, collated into a SableTM database. This model remains unchanged to 1 May 2013, except that the
thermal product has been included in the reporting of the resources.
The Coal Reserve and Resource estimates are reported in accordance with the JORC Code and the Australian
Guideline for Estimating and Reporting of Inventory Coal, Coal Resources and Coal Reserves. The resource for the
Makhado Project, as at 1 May 2013 and inclusive of reserves, is summarised in Table 1 below.
TABLE 1: THE MAKHADO JORC COMPLIANT RESOURCE ESTIMATE
GROSS TONNES IN GEOL. TOTAL TONNES IN MINEABLE TONNES
RESOURCE CATEGORY SITU (GTIS) (ad) LOSSES (%) SITU (TTIS) (ad) IN SITU (MTIS) (ad)
Total Measured Resources 402,780,570 10% 362,502,513 265,024,500
Total Indicated Resources 298,594,886 15% 253,805,653 76,743,000
Total Inferred Resource 94,232,132 20% 75,385,706 2,998,000
795,607,588 13% 691,693,872 344,765,500
Notes: (ad) Air dried basis
Source: CoAL Competent Person. Also independently verified by Venmyn Deloitte.
Mine Plan
The project has been divided into three separate mining areas for technical, logistical and practical reasons, namely
East Pit, Central Pit and West. The East and Central Pits are separated by the Siloam fault with a displacement of
approximately 50m. The Central and West Pits are separated by an area of sterilised coal associated with the village
of Mudimeli.
- Mining will be staggered, commencing in the East Pit followed by the Central and West Pits.
- This approach enables CoAL to optimise the resources required for mining over the LOM, as well as to provide a
consistent balance of ROM quantity and quality through to the plant.
- Makhado is planning to mine 12.6Mtpa, at steady state over LOM, with first production scheduled for month 26
from project start.
- Development of the East Pit will include plant and infrastructure components which will cater for the production
volumes from the other pits.
Makhado contains a number of coal seams with their dips requiring the walls of the pit to be benched for stability at
15-metre intervals and the overburden and interburden to be placed on surface until such time as concurrent
backfilling can begin. This geological setting is amenable to the proposed opencast large truck and shovel mining
method.
To achieve the required production rate of 12.6Mtpa ROM, the mining build-up schedule requires overburden waste
material to be pre-stripped in the initial box-cutting and ramp-building stage to establish an in-pit coal inventory before
coal extraction proceeds. Thereafter, for the following 5 years there will be a low to moderate annual overburden strip
ratio of 1:3.3.
A Whittle pit optimisation exercise was used to develop the economics of the coal deposit in relation to its technical
aspects. This allowed the selection of the optimal shell for each of the pits based upon their undiscounted NPV. The
practical pits will extend from an average depth of 30m below surface (to take into account the negative effect of
oxidation on the coal in the upper layers) to a maximum pit depth being 197m, 161m and 121m for the East, Central
and West Pits, respectively.
The subsequent increase in stripping volumes, up to a strip ratio of 1:4.1 annually, occurs concurrently with the
second pushback in the East and Central Pits. Due to the friable nature of the coal and its orientations, "through seam
blasting" technology will be employed to break the parting and coal seams. This tried and tested blasting technology
will minimise coal losses as well as coal contamination during the loading process.
Crusher and screening systems will be located to the south of each of the pits. The coal processing plant will be
located to the south of the East Pit. The processing plant site was selected to minimise haulage distances as the East
Pit is the largest pit with the greatest portion of coal reserves.
The operational expenditure (opex) is based on a contractor mining model with the Company responsible for mine
planning, geological and geotechnical controls as well as cost management.
Recent work carried out on detailed mine planning has enabled a coal Reserve Statement to be issued by CoAL,
confirming a total of 173 million ROM tonnes available to be mined for the Makhado Project. These estimates have
been reviewed by Competent Persons, Venmyn Deloitte. Below in Table 2 is the Makhado reserve statement.
TABLE 2: THE MAKHADO COAL RESERVE STATEMENT
MINING BLOCK / RESERVE MINEABLE TONNES ROM RESERVE (t) HARD COKING THERMAL COAL
PIT CATEGORY IN SITU (MTIS) (ad) COAL MARKETABLE MARKETABLE
RESERVE (ad) RESERVE (t) RESERVE (t)
East Pit 94,585,936 86,801,000 14,773,000 24,330,000
Central Pit Probable 53,472,256 49,071,000 6,747,000 10,560,000
West Pit 40,192,263 36,884,000 4,116,000 9,645,000
GRAND TOTAL / AVERAGE
MAKHADO RESERVES 188,250,455 172,756,000 25,636,000* 44,535,000
Notes: (ad) Air dried basis
* Hard coking coal production excluding fines of 4.07%
The total marketable reserve includes a period of ramp-up to a steady state rate of 2.3Mtpa of hard coking coal production.
Source: CoAL Competent Person. Also independently verified by Venmyn Deloitte.
Process Plant
A coal processing plant has been designed capable of handling the 12.6Mt of the ROM per annum in order to produce
the estimated 2.3Mtpa of hard coking coal and 3.2Mtpa of thermal coal. The hard coking coal will have an ash content
of 10%, whilst that of the thermal coal will be 30% ash.
A Process Design Criteria (PDC) completed by DRA Mineral Projects (Pty) Ltd (DRA), was used as the basis for
engineering studies and the coal handling process plant design. The site plan, plant layouts, equipment lists and
associated utilities are at an advanced stage.
The processing plant will include the following processing steps:-
- ROM is de-stoned in the pit by scalping off the +50mm which will be discarded. The -50+0mm stream, which is
estimated to be approximately 77% of the mined ROM delivered to the tip, will be conveyed to the plant feed
stockpile as feed to the hard coking plant;
- The processing plant comprises mainly of three processing sections:
- A double-stage Dense Medium Separation plant for both de-stoning and beneficiation of the hard
coking coal and the thermal product, achieved through a high gravity wash followed by a low gravity
wash (for the coarse size fraction of -50+1mm).
- A fines (-1+0.15mm) circuit comprising of a low gravity Reflux Classifier process for the production of
the coking coal and a high gravity Reflux Classifier for the production of the thermal product.
- An ultra-fines (-0.15mm) circuit of Jameson column flotation cells for the production of the coking coal
and a potential thermal product.
The plant has been designed to optimise yields with all size fractions being beneficiated. Further design
considerations included quality management and environmental protection, with an onsite laboratory and zero-effluent
discharge.
Yields
Full washability testwork was carried out on the various coal seam core samples. The results were imported into the
Minexä coal simulation programme and used to assess the yields and resultant product specifications. These results
were utilised for the determination of the potential saleable tonnes and product specifications for reserve purposes.
The theoretical yield variations at the Makhado Project are based on a 1.4 relative density (RD) wash product. An
initial assessment of the resource indicates a hard coking coal yield of 18.8% at 10% ash (inclusive of additional
4.07% recovery from fines) and a thermal coal yield of 25.8% at 30% ash. Therefore, the overall yield as defined by
the total product tonnes as a percentage of the ROM tonnes is 44.6%.
Coal Quality and Marketing
As part of the DFS, CoAL completed a comprehensive independent coal quality testing and analysis programme
which finalised coal quality specifications and determined the coal yield on Makhado. The various metallurgical
testwork programmes, which included both washing and coking tests, were carried out at various facilities and
reviewed by both Venmyn Deloitte and A&B Mylec.
The testwork proved that Makhado is capable of producing a hard coking coal product with a 10% ash content for the
export and domestic markets, as well as a thermal coal product also for the domestic or export market. According to
A&B Mylec, potential exists to increase the yield for the Makhado Project and this will be investigated in due course.
In addition, CoAL contracted the independent services of Wood Mackenzie (Australia) Pty Ltd (Wood Mackenzie) to
assess the global coal outlook in relation to the Makhado coal quality parameters.
TABLE 3: MAKHADO QUALITY SPECIFICATIONS
Specification Parameter & Units Makhado
Ash (%) 10.10
Volatiles (%) 31.00
Proximate Analysis Fixed Carbon (%) 57.00
Sulphur (%) 1.00
Phosphorous (%) 0.023
Theoretical Coke Yield (%) 73.00
Theoretical Coke Ash (%) 13.80
Coke and Coking Properties CSN 9.00
Fluidity 8,700
CSR 64
Rank Ro Max % 0.95
Source: Wood Mackenzie
Note: The Makhado qualities are generally in line with other seaborne traded hard coking coals.
Wood Mackenzie assessed the typical quality of the coking coal at Makhado to be hard coking coal with a relatively
high CSR value above 60 and therefore has an ability to carry weaker coals in the coke blend. The assessment was
based on specifications relative to other international hard coking coal producers and on the global outlook for hard
coking coal. The Makhado hard coking coal specification also indicates that it would be a good primary coal in a hard
coking coal blend, as demonstrated in blending tests at ArcelorMittal South Africa's Vanderbijlpark Steel Plant. In
addition, the Makhado coal has higher levels of organic sulphur than some competing Australian products, which have
inorganic sulphur that tends to lowers steel quality and contributes to emissions. As such, this coal should be
classified as a high volatile matter hard coking coal and is expected to be priced at benchmark parity. The
geographical location of the Makhado Project is an important factor in determining its likely markets.
Makhado's thermal coal is significantly different from the South African coalfields currently producing thermal product
for both export and domestic use, mainly because of its high calorific value. Therefore extensive combustion tests
were carried out to ascertain its usability primarily in Eskom's power stations that are able to receive coal on rail. The
tests confirmed that it is well within the specifications for Eskom's power stations and, for export, the grade conforms
to coal specifications required by importers and would be a suitable blend product for the power and cement industry
in Asia.
CoAL envisages product to be sold domestically and exported through CoAL's allocation at Terminal de Carvão da
Matola (TCM), Maputo in Mozambique. Makhado coal will have a freight advantage in serving the South African
domestic market compared to imported coking coals.
The thermal fraction of approximately 3.2Mtpa could be sold to South Africa's electrical authority, Eskom. The project
can also produce an export quality thermal coal.
Infrastructure
The Makhado Project benefits from excellent existing infrastructure with respect to rail, road, power and port
allocation. The site is located immediately to the east of the N1 highway (36km north of the town of Makhado) linking
South Africa to Zimbabwe and the rest of Africa, through the Beitbridge border post. Access to the site will be via the
existing road infrastructure.
Water
It is intended water will initially be obtained from boreholes for the construction phase and this will be supplemented by
some 4.6 million litres per day of water to be obtained from the Nzhelele Dam subject to the Company attaining a
water use licence.
Power
It is envisaged that CoAL will install a 15km 22 Kilovolts overhead powerline from the Eskom Paradise substation to a
consumer substation to be built at the East Pit in order to provide for the 10 Megavolts amp required for the mine and
plant.
Rail
It is expected rail access will be obtained through the construction of a 22km railway spur and rapid loading facility
from the existing Huntleigh Siding, which will connect through to the local domestic market as well as for export
through to TCM at the international Port of Maputo, Mozambique, located approximately 700km from the mine site.
Discussions are ongoing to ensure cost competitiveness for the Maputo corridor in comparison to other export
corridors.
Port
Currently, CoAL has 3Mtpa throughput allocation at TCM, with the option to subscribe for up to 100% (approximately
20Mtpa additional capacity) of the Phase IV expansion.
TCM has its own exclusive berth, shiploaders, stockpile area, rail tipplers, stacker reclaimers and conveyor handling
systems.
Site Infrastructure
The mine infrastructure includes plant and mining infrastructure, workshops and offices, haul roads, stockpiles, etc.
Various studies have been undertaken to optimally position the various requirements of a successful coal mining and
processing project and also taking into account the potential impact of these on the environment and local community.
Capital Costs
The capital cost estimate was compiled by an independent quantity surveying company Venn & Milford. The costs
were estimated from Bills of Quantities (BoQ) derived from detailed drawings, quotations received for equipment and
extracts from estimates of recently completed projects.
The estimates were completed on an accuracy range of +15% to -10% in real terms and do not include escalation.
These estimates were reviewed and signed off by Venmyn Deloitte as meeting the requirements of a Class II
Feasibility Study, as stated in the Competent Persons Report (CPR).
TABLE 4: CAPITAL OVER LIFE OF MINE (BASE DATED JANUARY 2013)
US$ Million
Capex WBS ZAR million (R9.75:$1)
Bulk Services 337.2 34.6
Mine Infrastructure 705.9 72.4
Surface Mining East Pit 292.9 30.1
ROM Handling 186.2 19.1
Processing Plant 1,095.8 112.4
Discard Handling 30.6 3.1
Product Handling 495.4 50.8
Indirect Costs (Owners Team; Environmental Guarantee; Insurance) 487.4 50.0
Contingencies 329.6 33.8
Total Capex 3,961.0 406.3
Peak Funding 4,219.6 432.8
Source: Various Consultants, information compiled by Venn & Milford. Also independently reviewed by Venmyn Deloitte
Operating Costs
The average on-mine operating costs are R865 (US$88.71) per saleable hard coking coal tonne (thermal coal is
treated as a by-product and is therefore a credit to the cost). On-mine operating costs are defined as costs including
mining, processing, maintenance, logistics, overheads and in-direct costs, therefore taking into account the full cost of
all the processes from mine to market.
TABLE 5: TOTAL MINE OPEX (BASE-DATED JANUARY 2013)
US$/Saleable
Description ZAR/ROM Tonne ZAR/Saleable Hard coking Coal Tonne
Hard coking Coal Tonne (R9.75:$1)
Mining 213.01 1 126.42 115.53
Process 12.39 65.61 6.72
Site Logistics 0.46 2.43 0.25
Mine Overheads 9.62 50.87 5.20
Thermal Coal Revenue * -380.33 -39.01
Total mine gate cost 235.48 865.00 88.71
Note: * Thermal coal based on current Eskom contracts.
Excludes Rail (export) and Port charges
Source: Various Consultants, information compiled by CoAL. Also independently reviewed by Venmyn Deloitte.
Economics
The financial model evaluates the estimated economic returns from the development and operation of the Makhado
mine. The model is a real term model and does not make provision for escalation.
Production estimates, capital-cost estimates and operating cost estimates have been combined in the financial model
to calculate the IRR and NPV based on the estimated cash flows resulting from developing and operating the
Makhado mine.
The model parameters/variables and a summary of the results are outlined below in Table 6 and Table 7.
TABLE 6: BASE CASE VARIABLES
Discount Rate (real) 8%
ZAR/US$ Exchange Rate R9.75:$1
Average price per tonne for hard coking coal * $206.16
Overall Yield (hard coking coal) 18.8%
Overall Yield (thermal coal) 25.8%
Source: CoAL
*- HCC price based on long term view of independent experts. The price over LOM ranges from $180.42 (2016) to $230.28 (2032)
TABLE 7: BASE CASE ANALYSIS RESULTS JANUARY 2013
Capital Investment (Capex) R3.96bn $406.3m
Cash Flow before Tax R23.48bn $2 408.4m
Net Cash Flow (non-discounted) R17.01bn $1 744.7m
Net Present Value R6.79bn $697.0m
Internal Rate of Return (real) 30.1% 30.1%
Payback Period 6 years 6 years
Note: ZAR9.75: US$1
Source: CoAL
Licensing
The New Order Mining Right (NOMR) application for the Makhado Project was submitted on 20 January 2011 and
accepted by the Department of Mineral Resources (DMR) on 25 February 2011. The environmental authorisation
requirements and processes, the main legal frameworks being the Mineral and Petroleum Resources Development
Act 28 of 2002 (MPRDA), the National Environmental Management Act 107 of 1998 (NEMA) and the National Water
Act 36 of 1998 (NWA), were undertaken in parallel.
The final Environmental Impact Assessment / Environmental Management Programme (EIA/EMP) was submitted to
the authorities on 25 September 2012 and the final submission of the Integrated Water User License (IWUL)
application on 10 December 2012.
All regulatory licenses (NOMR and IWUL) applications are expected to be received by H1 CY14, subject to the
Company concluding a BEE partnership transaction. The Company is making progress in acquiring all required
surface rights including the farms Lukin and Salaita.
Review of the Company's DFS
Venmyn Deloitte was mandated by CoAL to perform an independent high level review of the results of the Company's
DFS on the Makhado Project, to verify that the Makhado DFS meets the industry standard requirements of a study of
this level and to prepare an independent and updated Competent Persons Report on the project for the Company's
public reporting purposes.
Venmyn Deloitte and their team of Experts (mainly using the consulting company WorleyParsons-TWP) have
completed the high level review of the Makhado Project's resources and reserves, as well as the results of the DFS
prepared by CoAL and its consultants. Venmyn Deloitte concluded that the technical and financial basis and estimates
relating to the project are "reasonable". Venmyn Deloitte believes that the assumptions and financial valuation are a
fair reflection of the project, as at 1 May 2013, based upon the information available at that point in time. Their
overriding conclusion is that it meets the industry standard requirements of a DFS (Class II Feasibility Study). A Class
II study requires that studies and estimates of variables are detailed in nature. Capital cost estimates are required in
the range +15% to -10% and the contingencies applied being 8% to 12%. The DFS clearly demonstrated that the
Makhado Project is feasible, with the normal risks typically associated with resource projects.
The DFS is therefore complete and ready for submission to a funding institution or other potential investors for their
consideration. The Company will proceed with obtaining off-take agreements for its hard coking and thermal coal
products and commence with the construction phase of the project.
Statements from Venmyn Deloitte:
Review of Resources and Reserves: "Venmyn Deloitte has independently reviewed both the Resource and Reserve
statements, prepared by CoAL, for the Makhado Project and found them to be compliant with the JORC code and a
reliable estimation of the coal within the ground based upon the currently available information.
The JORC compliant Coal Resource for the Makhado Project, as at 1st May 2013 were estimated and signed off by
CoAL's Competent Person, Mr J C H K Sparrow (Pr.Sci.Nat.), CoAL's chief geologist.
Coal Reserves were estimated and signed off by CoAL's Competent Person, Mr M J Brönn, CoAL's Mining Engineer
and Optimisation Manager, as at 1st May 2013 and in accordance with the JORC Code. Venmyn Deloitte has
reviewed VBKom's Whittle input parameters and optimised pit shell and has also reviewed CoAL's financial model
based on the estimated production, mining and processing costs and capital expenditure which CoAL used to
demonstrate the economic viability of extracting these Coal Reserves. Venmyn Deloitte is satisfied that the modifying
factors are reasonable and have been appropriately applied in the derivation of the reserves."
Conclusion: "The DFS has clearly demonstrated that the Makhado Project is feasible, with the normal risks typically
associated with resource projects. The Makhado Project represents CoAL's first project within the greater
Soutpansberg Coalfield area, and the company is poised to become a significant global coking coal producer. The
potential benefit of this project to the local community, the Limpopo Province and South Africa as a whole has been
clearly demonstrated in this report."
Venmyn Deloitte Competent Persons:
C.A. Telfer G. Njowa
B.SC. HONS (GEOL.), (DMS) DIP BUS MAN M.SC MRM (MIN. ENG), BSC HONS (MIN. ENG), GRAD CIS
PR. SCI. NAT., MGSSA, MAUSIMM MSAIMM, MAUSIMM, PR ENG, MIASSA.
Competent Person Competent Person and Valuator
The table below indicates the consultants used in preparing and verifying the DFS.
TABLE 8: CONSULTANTS AND AREAS OF RESPONSIBILITY
Detail Scope
Venn & Milford Inc. Capital cost estimate
MCC Contracts (Pty) Ltd wholly owned by EQSTRA Ltd Mining contractor specialist
VBKom Consulting Engineers (Pty) Ltd Mine design specialist
DRA (Pty) Ltd Coal Handling Process Plant
RCE Rail logistics
Minopex (subsidiary of DRA Group) Operation and maintenance of the plant
Semane Consulting Engineers (Pty) Ltd Civil, structural and infrastructure engineering
Bigen Africa Services (Pty) ltd Bulk water
WSM Leshika (Pty) Ltd Ground Water Extraction (Boreholes)
EHL Engineers (Pty) Ltd Electrical and ICT Design (Information Technology)
Sandvik (Pty) Ltd Bulk power and product handling
NOSA wholly owned by MICROmega Ltd Safety and Health
Jacana Environmental cc Environmental management and closure provision
Naledi Development (Pty) Ltd SLP (Social labour plan); Community Engagement
CoAL Owner's Team and Support Services Project Management, Finance, Security, HR
Competent Persons Statement
The JORC compliant Coal Resources for the Makhado Project, as at 1 May 2013 were estimated and signed off by
CoAL's Competent Person, Mr J C H K Sparrow (Pr.Sci.Nat.), CoAL's chief geologist. Mr Sparrow is a member of the
South African Council for Natural Scientific Professions, a Recognised Overseas Professional Organisation included
in a list promulgated by the ASX from time to time; Mr Sparrow is a full-time employee of the company.
Coal Reserves were estimated and signed off by CoAL's Competent Person, Mr M J Brönn, CoAL's Mining Engineer
and Optimisation Manager, as at 1st May 2013 and in accordance with the JORC Code. Mr Brönn is a member of the
South African Institute for Mining and Metallurgy, a Recognised Overseas Professional Organisation included in a list
promulgated by the ASX from time to time; Mr Brönn is a full-time employee of the company.
Both Mr Sparrow and Mr Brönn have sufficient experience which is relevant to the style of mineralisation and type of
deposit under consideration and to the activity which they are undertaking to qualify as a Competent Person as
defined in the 2004 Edition of the Australian Code for Reporting of Exploration Results, Mineral Resources and Ore
Reserves. Both Mr Sparrow and Mr Brönn consent to the inclusion in this report on the matters based on their
information in the form and context in which it appears.
The Resource Statement and Reserve Statement have been independently verified by Venmyn Deloitte.
Webcast
Management will provide further insight on the Definitive Feasibility Study via a simultaneous webcast and conference
call at 12h30 (CAT) on 19 June 2013.
The simultaneous webcast and conference call will be accessible on
http://themediaframe.eu/links/coalofafrica130618.html CoAL's website at www.coalofafrica.com.
Teleconference
Australia (Toll-free) 1 800 350 100
Other countries (International toll) +27 11 535 3600
Other countries (Alternative) +27 10 201 6616
South Africa (Toll-free) 0800 200 648
South Africa (Johannesburg) 011 535 3600
South Africa (Johannesburg Alternative) 010 201 6800
UK (Toll-free) 0808 162 4061
USA and Canada (Toll-free) *0 for operator 1 800 921 0864
PLAYBACK
A playback of the teleconference will be available for 48 hours afterwards on the following telephone numbers:
South Africa (Telkom) 011 305 2030 Code: 23654
USA and Canada (Toll) 412 317 0088 Code: 23654
Other countries (Toll-free) 0808 234 6771 Code: 23654
AUTHORISED BY:
David Brown
Chairman
For more information contact:
David Brown Chairman Coal of Africa +27 11 575 4363
Sakhile Ndlovu Investor Relations Coal of Africa +27 11 575 6858
Tony Bevan Company Secretary Endeavour Corporate Services +61 08 9316 9100
Company advisors:
Jos Simson/Emily Fenton Financial PR (United Kingdom) Tavistock +44 20 7920 3150
Chris Sim/Neil Elliot Nominated Adviser Investec Bank plc +44 20 7597 5970
Charmane Russell/James Duncan Financial PR (South Africa) Russell & Associates +27 11 880 3924 or
+27 82 372 5816
Investec Bank Limited is the nominated JSE Sponsor
About CoAL:
CoAL is an AIM/ASX/JSE listed coal exploration, development and mining company operating in South Africa. CoAL's key projects include the Vele Colliery (coking
and thermal coal), the Greater Soutpansberg Project, including CoAL's Makhado coking coal Project.
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