Coal of Africa (CoAL) has devised a lower capital cost development plan for its Makhado coking and thermal coal project in Limpopo, which will cost $75m-$85m and have a 12-month construction period, CEO David Brown says. South African mining companies have taken a more cautious approach to new developments in the past two years amid extended regulatory uncertainty, which has also made lenders more risk averse. CoAL originally intended to build Makhado at a cost of $406m to produce 2.3-million tonnes a year of hard coking coal and 3.2-million tonnes of thermal coal after 26 months of construction. Under the new plan it will produce about 0.7-0.8Mt/year of hard coking coal and 0.9-1.0Mt/year of export quality thermal coal, with potential to expand in future years. The Industrial Development Corporation will lend up to R240m to advance the Makhado project for a 5% stake while black empowerment investors own 26%. CoAL’s 69% share of the funding needed for construction will be raised 60:...
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