resgen.com.au
Resource Generation (ASX: RES) is developing one of South Africa’s largest remaining coal deposits, with the company's focos on the Boikarabelo tenements, in the Waterberg region of South Africa.
The strategy for the company is to develop high grade “energy” related resources into viable and competitive mining operations. Accelerated shareholder value will be delivered through the delivery of physical mining activity.
Resource Generation major milestone for Boikarabelo with Mining Right granted
Resource Generation (ASX: RES) has ticked off another major milestone for the huge Boikarabelo coal mine in South Africa, with the Mining Right being granted by the South African Department of Mineral Resources.
Resource Generation has now received the formal documentation for a 30 year Mining Right.
Paul Jury, managing director, said "We expect the Mining Right will facilitate our discussions with Eskom regarding coal supply to its power stations and with Transnet regarding transport to domestic customers and ports."
Boikarabelo is forecast to start production towards the end of 2013, and is part of the Ledjadja joint venture with Resource Generation holding 74%.
The documentation also confirmed the change of Resource Generation’s BEE (black economic empowerment) partner in Ledjadja to Fairy Wing Trading 136 (Pty) Limited.
Fairy Wing Trading 136 (Pty) Limited (FWT), a company owned by a group of South African businessmen and women with strong commercial and government relationships, has agreed to acquire the 26% shareholding in the Ledjadja JV that was owned by its original BEE (black economic empowerment) partner.
Boikarabelo has a massive 6.4 billion tonne resource – a 120 metre thick coal seam at shallow depth of 20-35 metres. Current probable reserve is 745 million tonnes of thermal coal, which has the potential to increase as this reserve amounts to only 35% of the resource bearing tenements.
The Boikarabelo coal seam is between 20 and 30 metres below the surface, enabling low-cost, open-cut mining. The seam is between 120 and 130 metres thick, with zones of varying quality thermal and soft coking coal.
Importantly, the Boikarabelo tenements are only 40 kilometres by road from an existing rail system that provides access to domestic markets and to the ports of Maputo, Richards Bay and Durban for export shipments.
These three ports all have potential to expand their coal capacity, and a proposed new railway to Walvis Bay in Namibia, if constructed, would also offer access to export markets.
