Exxaro looking strong
Coal is unfashionable but Exxaro has lots of it and the low-carbon economy is not going to happen overnight
The world is moving away from fossil fuels, especially dirty coal. Increasingly, funding for coal-related projects is drying up and major miners continue to divest from their coal assets. But the growing negative sentiment around coal presents a window of opportunity for a company like Exxaro, whose core revenue generation is from coal mining. "This whole sentiment, and what some banks have done, has caused a very interesting positive in the sector," says Nombasa Tsengwa, executive head for coal operations at Exxaro, following the release of the company’s annual results last week. "Different players are selling off their assets and not putting up new capacity in the market. Those with availability of coal have the advantage." Exxaro has R20bn budgeted to invest in new coal operations over the next few years. This is funded from a combination of its own cash and financing from major banks, says FD Riaan Koppeschaar. And now it wants to push forward investments to expand on two coal p...
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