EDITOR’S CHOICE PROJECTS Kangala It’s the final countdown ASX-listed junior mining company Universal Coal has had a phenomenal year, having moved its primary thermal coal asset Kangala from a bankable study, to development and imminently, first production – all while remaining committed to deliver first coal two months ahead of schedule – in February this year. By Laura Cornish. IN SHORT Development of the Delmas-based Kangala colliery is fast approaching the finish line. When it does, Universal Coal’s status will change from developer to producer. K angala, in which Universal Coal holds 70.5% ownership, will be a 2 Mtpa coal operation and thanks to its low stripping ratio (1.6:1), requires only a slightly higher 2.4 Mtpa ROM rate. While achieving first production will be a significant accomplishment in its own right, for a junior, it falls on the back of an extremely short development timeframe. And despite this, will deliver coal two months ahead of its original target date. The project ticks every box with mining right, environmental authorisation and water licence secured. It is fully financed (AU$13.5 million) following a successful cash raising exercise in December 2011 and 29.5% BEE partner Mountain Rush is contributing its share. Every step building up to development and now including development has been relatively seamless (in mining terms). Following shortly after the appointment of main contractors Stefanutti Stocks Mining Services and Mineral Resource Development, and a R300 million project financing arrangement with RMB in February last year, Universal Coal jumped its final hurdle, securing a domestic contract with Eskom to purchase the majority of its coal. In July, the company also signed an off- take agreement with Exxaro to supply up to 100 000 tpa of high quality coal for the export market. The pit – the first of a possible three Once production starts, Kangala will consist of a single pit with an eight year lifespan, although the plan to introduce a second contiguous pit remains on the table. “It will extend Panoramic view of Kangala plant. December 2013 18 MINING REVIEW AFRICA ISSUE 1 2014