SA coal mining and exploration company Canyon Coal has completed its $40m acquisition of Kangra Coal and is looking to develop new projects. This could create more jobs at the Mpumalanga coal operations.
Canyon acquired the company from Madrid-listed energy firm Gas Natural Fenosa and SA-based Izimbiwa Coal Investments.
With Kangra also comes a 2.3% interest in the Richards Bay Coal Terminal, one of the world’s largest such terminals, and from which it can move 1.6-million tons a year.
Kangra has an underground mine and open-cast operations near Piet Retief, Mpumalanga, where it produces 2-million tons of coal per annum.
The conclusion of the deal adds to the rapidly growing portfolio of coal assets under the control of Menar Holdings, the largest private export-oriented coal producer in SA.
Menar’s SA investments include stakes in Canyon Coal and Zululand Anthracite Colliery, SA’s only producer of prime anthracite, very high-quality coal.
Canyon’s purchase agreement for Kangra was signed in June and the Competition Commission’s approval was granted at the end of November. The department of mineral resources’ consent to transfer the mineral rights came through last week.
Menar MD Vuslat Bayoglu said the deal has been concluded reasonably quickly and is a credit to SA as an investment destination.
Kangra employs 1,282 people, including contractors, but Bayoglu said a team of experts at Canyon is now conceptualising plans to develop new projects at Kangra that could create more jobs.
“We are looking at ways to grow Kangra. I don’t believe in sitting on assets. Mineral resources minister Gwede Mantashe says we should develop our assets and grow mining’s contribution to the GDP and I agree with him,” Bayoglu said.
Menar is credited for achievements at the Zululand Anthracite Colliery, which it bought from Rio Tinto in 2016 and turned it from a loss-making operation to a profitable one in two years. The company retained jobs at the mine and over time created more, Bayoglu said.