JOHANNESBURG, Nov 13 (Reuters) - South Africa’s Kumba Resources KMBJ.J and unlisted Eyesizwe Coal said on Monday the Inyanda coal mine, their 50/50 joint venture, had been granted new order mining rights from the mines department.
Under the country’s mining laws, South Africa’s government has taken over as custodian of mineral rights, and all companies must reapply for mining and prospecting licences.
Development of the Inyanda mine has been on the cards for a long time, but was subject to attainment of the mining rights, as well as the go-ahead of expansion of the Richards Bay Coal Terminal (RBCT) which was approved earlier this year.
The Inyanda mine is situated near Witbank in Mpumalanga province and will produce 1 Million tonnes per year of A-grade thermal coal for the export market, via RBCT.
Construction can now commence and the mine is expected to reach full production in 2008. Capital expenditure is estimated at 184 million rand ($25.41 million), Kumba said. and re-listed Kumba effective from 27 November 2006, and which is a result of Kumba’s empowerment transaction.
Kumba announced last October it was splitting into an iron ore firm and a company focusing on coal and heavy minerals — Exxaro Resources Ltd. — that would be the country’s biggest black-owned mining firm.
The Inyanda mine will be operated by Exxaro.
Kumba Iron Ore will list on Nov. 20 and Exxaro a week later on the Johannesburg Securities Exchange.
The deal allows Anglo to keep a strong presence in the lucrative iron ore industry while also meeting government demands to spread more ownership to the country’s majority black population.