Wrap Text
Report for the Quarter ended 30 June 2015
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 27 July 2015
REPORT FOR THE QUARTER ENDED 30 JUNE 2015
Makhado Mining Right transforms CoAL
Coal of Africa Limited (“CoAL” or “the Company”) which operates in South Africa, together with its
subsidiaries, hereby provides its update for the quarter ended 30 June 2015. All figures are denominated in
United States dollars unless otherwise stated. A copy of this report is available on the Company's website,
www.coalofafrica.com.
Salient Operational Features
- No lost-time injuries (“LTIs”) recorded during the quarter (FY2015 Q3: nil).
- The Department of Mineral Resources (“DMR”) granted the Company a New Order Mining Right
(“NOMR”) for the Makhado hard coking and thermal coal project (“Makhado Project”) as well as Section
11 approval transferring the project from CoAL to its subsidiary Baobab Mining & Exploration (Pty) Ltd
(“Baobab”).
Corporate and Financial Features
- Agreement reached for the liability owing to Rio Tinto with the balance to be paid in monthly instalments of
at least $100,000 plus interest and the obligation settled by June 2017. During the quarter the Company
paid the interest accrued from May 2014 of $1.2 million (FY2015 Q3: nil) and $2.7 million (FY2015 Q3:
$1.0 million) in capital and the balance remaining at the end of the period was $19.8 million.
- Continued engagements with the Department of Water Affairs to progress the application for the Makhado
Project Integrated Water Use Licence (“IWUL”), expected to be granted in Q3 CY2015.
- During the quarter the Company issued 144 million shares at GBP0.55 each raising $13.8 million
completing the $65 million (before charges and foreign currency movements) three stage shareholder
approved equity raise process.
- Renegotiation of the Opgoedenhoop NOMR sale with the R17.4 million ($1.4 million) (including interest
and VAT) owing to CoAL payable in monthly instalments of at least R0.25 million ($0.02 million) with the
balance due by the end of H1 CY2016.
- Appointment of De Wet Schutte as Chief Financial Officer and Executive Director during the quarter.
- Available cash at period end was $17.8 million and restricted cash of $1.3 million.
Commenting today, Mr David Brown, Chief Executive Officer said: “The granting of a mining right for CoAL’s
flagship Makhado Project is an important milestone, given that the project has the potential to stimulate
domestic industrialisation once it reaches full capacity. The Company can now move towards developing the
colliery which has the capability to produce hard coking and thermal coal, thereby capitalising on its proximity
to underutilised rail infrastructure.
With these significant developments we are getting closer to extracting value from this project. We continue to
engage constructively with the Department of Water and Sanitation and anticipate that we will be granted an
IWUL in due course. The process of identifying potential strategic partners to provide funding and technical
expertise is on track. We expect to finalise this process and the necessary off-take agreements with
prospective customers by the end of H1 CY2016.”
QUARTERLY COMMENTARY
Makhado Coking Coal Project – Soutpansberg Coalfield (100% owned - 74% post BBBEE transaction)
The Makhado Project recorded no LTIs (FY2015 Q3: no LTIs) during the quarter.
During the quarter the DMR granted the Company a NOMR in terms of the Mineral and Petroleum Resources
Development Act (Act 28 of 2002) as well as Section 11 approval to transfer the right from CoAL to Baobab,
the company that will develop the colliery. Makhado’s 26 month construction phase is expected to begin in H2
CY2016 with a further four month ramp-up phase resulting in the production of 5.5 Mtpa of saleable product.
Consultations with potential customers to secure off-take agreements for Makhado’s hard coking and thermal
coal products and with potential project funders continued during the quarter.
An interim court interdict seeking to halt any mining or construction activity was issued against the Makhado
Project during Q2 FY2015. As one of the respondents the Company is preparing to have the interim interdict
set aside. CoAL does not anticipate that the process will affect the Makhado Project construction timetable.
Mooiplaats Colliery – Ermelo Coalfield (74% owned)
The Mooiplaats thermal coal colliery (“Mooiplaats Colliery”) was placed on care and maintenance during the
September 2013 quarter and recorded no LTIs during the period (FY2015 Q3: no LTIs).
During Q1 FY2015 the Company signed a Share Purchase Agreement (“SPA”) with Blackspear Capital
Proprietary Limited ("Blackspear") for the disposal of the Mooiplaats Colliery for R250 million ($20.3 million).
Blackpear was unable to agree terms with a financial and operational partner to fund its acquisition resulting in
the SPA lapsing. The Company is continuing discussions with other potential purchasers including
Blackspear.
Vele Colliery – Limpopo (Tuli) Coalfield (100% owned)
The Vele coking and thermal coal colliery (“Vele Colliery”) recorded no LTIs during the quarter (FY2015 Q3:
no LTIs).
The Company previously submitted applications to amend and renew Vele’s IWUL and expects these to be
granted during H2 CY2015. CoAL does not anticipate any delays as a result of the appeal lodged against the
colliery’s amended and updated EA. The current Vele Colliery IWUL is valid until March 2016 and the
Company has delayed the commencement of the plant modification construction pending the approval of the
amended IWUL and approved Water Use Licence for the planned stream diversions, as well as an
assessment of global coal prices.
Greater Soutpansberg Project (MbeuYashu) (74% owned)
The MbeuYashu Project recorded no LTIs (FY2015 Q3: no LTIs) during the period.
Authorised by
David Brown
Chief Executive Officer
27 July 2015
For more information contact:
David Brown Chief Executive Officer Coal of Africa +27 10 003 8000
De Wet Schutte Chief Financial Officer Coal of Africa +27 10 003 8000
Celeste Harris Investor Relations Coal of Africa +27 10 003 8000
Tony Bevan Company Secretary Endeavour Corporate Services +61 08 9316 9100
Company advisors:
Matthew Armitt/Ross Allister Nominated Adviser and Peel Hunt LLP +44 20 7418 8900
Broker
Jos Simson/Emily Fenton Financial PR (United Tavistock +44 20 7920 3150
Kingdom)
Charmane Russell/Jane Kamau 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 /MbeuYashu, including CoAL’s Makhado Project (coking and thermal coal).
AU: Coal of Africa Limited, Suite 8, 7 The Esplanade, Mount Pleasant, Perth WA 6153, Australia, Tel: +61 8 9316 9100, Fax: +61 8 9316 5475
ZA: South Block, Summercon Office Park, Cnr Rockery Lane and Sunset Avenue, Lonehill, 2191, Tel: +27 10 003 8000 Fax: +27 11 388 8333 Email: adminza@coalofafrica.com
Bernard R. Pryor – Chairman, David H. Brown – Chief Executive Officer , De Wet O. Schutte – Chief Financial Officer Non-executive directors: Peter G. Cordin, Andrew D. Mifflin, Khomotso B. Mosehla ,Thabo F.
Mosololi, Rudolph H. Torlage
Tenements held by CoAL and its Controlled Entities
Change
Project Name Tenement Number Location Interest in quarter
Chapudi Albert 686 MS- Limpopo~ 74%
Project*
Bergwater 712 MS-- 74%
Remaining Extent and Portion 2 of Bergwater 697 MS-- 74%
Blackstone Edge 705 MS 74%
Remaining Extent & Portion 1 of Bluebell 480 MS- 74%
74%
Remaining Extent & Portion 1 of Bushy Rise 702 MS--
Castle Koppies 652 MS-- 74%
Chapudi 752 MS -- 74%
Remaining Extent, Portions 1, 3 & 4 of Coniston 699 MS-- 74%
Driehoek 631 MS-- 74%
Remaining Extent of Dorps-rivier 696 MS-- 74%
Enfield 512 MS (consolidation of Remaining Extent of 74%
Enfield 474 MS, Brosdoorn 682 MS & Remaining Extent of
Grootvlei 684 MS)--
Remaining Extent and Portion 1 of 74%
Grootboomen 476 MS- 74%
Grootvlei 684 MS-- 74%
Kalkbult 709 MS 74%
Remaining Extent, Remaining Extent of Portion 2, 74%
Remaining Extent of Portion 3, Portions 1, 4, 5, 6, 7 & 8 of
Kliprivier 692 MS-
Remaining Extent of Koodoobult 664 MS- 74%
Koschade 657 MS (Was Mapani Kop 656 MS)- 74%
Malapchani 659 MS- 74%
Mapani Ridge 660 MS- 74%
Melrose 469 MS- 74%
Middelfontein 683 MS- 74%
Mountain View 706 MS- 74%
M'tamba Vlei 654 MS 74%
Remaining Extent & Portion 1 of Pienaar 635 MS- 74%
Remaining Extent & Portion 1 of Prince's Hill 704 MS- 74%
Qualipan 655 MS- 74%
Queensdale 707 MS- 74%
Remaining Extent & Portion 1 of Ridge End 662 MS- 74%
Remaining Extent & Portion 1 of Rochdale 700 MS- 74%
Sandilands 708 MS- 74%
Portions 1 & 2 of Sandpan 687 MS-- 74%
Sandstone Edge 658 MS- 74%
Remaining Extent of Portions 2 & 3 of Sterkstroom 689 74%
MS--
Sutherland 693 MS- 74%
Remaining Extent & Portion 1 of Varkfontein 671 MS-- 74%
Remaining Extent, Portion 2, Remaining Extent of Portion 74%
1 of Vastval 477 MS-
Vleifontein 691 MS- 74%
Ptn 3, 4, 5 & 6 of Waterpoort 695 MS-- 74%
Wildebeesthoek 661 MS- 74%
Change
Project Name Tenement Number Location Interest in quarter
Woodlands 701 MS- 74%
Kanowna West M27/41 Coolgardie^ 23.68%
and
Kalbara M27/47 23.68%
M27/59 23.68%
M27/72,27/73 23.68%
M27/114 23.68%
M27/181 21.31%
M27/196 23.68%
M27/414,27/415 23.68%
P27/1826-1829 23.68%
P27/1830-1842 23.68%
P27/1887 23.68%
Abbotshall ML63/409,410 Norseman^ Royalty
Royalty
Kookynie ML40/061 Leonora^ Royalty
Royalty
ML40/135,136 Royalty
Holfontein Remaining extent, Remaining Extent of portions 1, 5 and Mpumalanga~ 100%
11 and portions 4, 6, 9, 10, 12 and 13 of the farm
Holfontein 138 IS
Makhado Fripp 645 MS Limpopo~ 100%#
Project
Lukin 643 MS 100%#
Remaining Extent and Portion 1 of Overwinning 713 MS 100%#
Salaita 188 MT 100%#
Tanga 648 MS 100%#
Remaining Extent, Portion 1 and 100%#
Portion 2 of the farm Windhoek 649 MS
Generaal Limpopo~ 74%
Beck 568 MS--
Project
Bekaf 650 MS- 74%
Remaining Extent & Portion 1 of Boas 642 MS- 74%
Chase 576 MS- 74%
Coen Britz 646 MS- 74%
Fanie 578 MS- 74%
Gray 189 MT 100%
Portions 1, 2 and Remaining Extent of Generaal 587 MS- 74%
Joffre 584 MS- 74%
Juliana 647 MS 74%
Kleinenberg 636 MS- 74%
Remaining Extent of Maseri Pan 520 MS- 74%
Remaining Extent and Portion 2 of Mount Stuart 153 MT-- 100%
Nakab 184 MT-- 100%
Phantom 640 MS-- 74%
Riet 182 MT-- 100%
Rissik 637 MS- 100%
Salaita 188 MS- 74%
Schuitdrift 179 MT- 100%
Septimus 156 MT-- 100%
Change
Project Name Tenement Number Location Interest in quarter
Solitude 111 MT- 74%
Stayt 183 MT-- 100%
Telema 190 MT 100%
Remaining Extent & Portion 1 of Terblanche 155 MT-- 100%
Van Deventer 641 MS- 74%
Wildgoose 577 MS- 74%
Mopane Limpopo~ 100%
Ancaster 501 MS--
Project*
Banff 502 MS- 74%
Bierman 599 MS- 74%
Cavan 508 MS 100%
Cohen 591 MS-- 100%
Remaining Extent, Portions 1 & 2 of Delft 499 MS- 74%
Dreyer 526 MS-- 74%
Remaining Extent of Du Toit 563 MS- 74%
Faure 562 MS 74%
Remaining Extent and Portion 1 of Goosen 530 MS -- 74%
Hermanus 533 MS- 74%
Jutland 536 MS-- 100%
Krige 495 MS- 74%
Mons 557 MS- 100%
Remaining Extent of Otto 560 MS (Now Honeymoon)- 74%
Remaining Extent & Portion 1 of Pretorius 531 MS- 74%
Schalk 542 MS- 74%
Stubbs 558 MS- 100%
Ursa Minor 551 MS-- 74%
Van Heerden 519 MS-- 74%
Portions 1, 3, 4, 5, 6, 7, 8, 9, Remaining Extent of Portion 74%
10, Portions 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24,
26, 27, 29, 30, 35, 36, 37, 38, 39, 40, 41, 44, 45, 46, 48,
49, 50, 51, 52 & 54 of Vera 815 MS
Remaining Extent of Verdun 535 MS- 74%
Voorburg 503 MS-- 100%
Mooiplaats Mpumalanga~ 74%
Colliery and Portions 1, 9,14,17,18,19,20 & Remaining Extent of
prospects Mooiplaats 290 IT
Portion 2, 3 and Remaining Extent of Klipbank 295 IT 74%
Portions 1, 2 and Remaining Extent of Adrianople296 IT 74%
Portions 2 & 3 of Willemsdal 330 IT 74%
Portions 2, 3, 4 & Remaining Extent) of De Emigratie 327 74%
IT
Remaining Extent and Portions 2, 5, 8,10 & 13 of 74%
Buhrmansvallei 297 IT
Klipfontein 442 IT 74%
Vele Colliery Portions of Overvlakte 125 MS (Remaining Extent, 3, 4, 5, Limpopo~ 100%
and prospect 6, 13, 14)
Bergen Op Zoom 124 MS 100%
Semple 155 MS 100%
Voorspoed 836 MS 100%
Alyth 837 MS 100%
Lizzuela 62 MS 100%
Patracia 65 MS 100%
Hacyon 69 MS 100%
Change
Project Name Tenement Number Location Interest in quarter
Tshikunda Certain portions of Unsurveyed State Land known as Limpopo~ 60%
Mutale
Coal bed Limpopo~ 50%
Adelaide 91 MT
methane
Adieu 118 MT 50%
Alicedale 138 MT 50%
Armstice 120 MT 50%
Bergwater 697 MS 50%
Bergwater 712 MS 50%
Blackstone Edge 705 MS 50%
Bushy Rise 702 MS 50%
Chapudi 752 MS 50%
Charlotte 90 MT 50%
Chase 576 MS 50%
Cross 117 MT 50%
Doppie 95 MT 50%
Ettie 33 MT 50%
Fanie 578 MS 50%
Feskraal 85 MT 50%
Folorodwe 79 MT 50%
Fripp 645 MS 50%
Gray 189 MT 50%
Hettey 93 MT 50%
Jeannette 77 MT 50%
Joffre 584 MS 50%
Kalkbult 709 MS 50%
Laura 115 MT 50%
Lukin 643 MS 50%
Magazasand 123 MT 50%
Malapchani 659 MS 50%
Mountainview 706 MS 50%
Mount Stuart 153 MT 50%
Nakab 184 MT 50%
Naus 178 MT 50%
Neltox 92 MT 50%
Phantom 640 MS 50%
Prince’s Hill 704 MS 50%
Queensdale 707 MS 50%
Riet 182 MT 50%
Rochdale 700 MS 50%
Rynie 158 MT 50%
Salaita 188 MT 50%
Schuitdrift 179 MT 50%
Septimus 156 MT 50%
Stayt 183 MT 50%
Suzette 32 MT 50%
Tanga 648 MS 50%
Telema 190 MT 50%
Terblanche 155 MT 50%
Trevenna 119 MT 50%
The Duel 186 MT 50%
Truida 76 MT 50%
Change
Project Name Tenement Number Location Interest in quarter
Van Deventer 641 MS 50%
Wendy 86 MT 50%
Wildgoose 577 MS 50%
Windhoek 649 MS 50%
Zisaan 31 MT 50%
Ziska 122 MT 50%
Portion of Unsurveyed state land 50%
* Form part of the Greater Soutpansberg Project
- Lapsed – Mining Right Application Lodged
-- Valid – Mining Right Application Lodged
~ Tenement located in the Republic of South Africa
^ Tenement located in Western Australia
# CoAL’s interest will reduce to 74% owned on completion of the Broad Based Economic Empowerment
transaction
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