HCCL targets overseas market
HWANGE Colliery Company Limited is targeting to export coking coal to South Africa and overseas markets once it starts processing coal from underground operations expected to resume before the end of the year.
The company took delivery of one of its major underground machinery, the continuous miner last week and expects other ancillary equipment in the next six weeks, with mining operations expected to start before the end of the year. The company’s managing director, Engineer Thomas Makore, said the breakdown of the continuous miner last year which led to the suspension of underground mining had a negative impact on the company’s profitability realised from the selling of coking coal.
Coking coal or metallurgical coal is obtained from underground mining operations and is used in the process of creating coke necessary for iron and steel making.
“Without underground mining operations, the company has been under severe pressure in terms of profitability and cash flow. The underground mining operations contribute in terms of additional volumes and improved margins because the coking coal price is much higher than the other grades,” said Eng Makore.
He said the company was looking forward to tapping into the South African and overseas markets for coking coal exports.
Early this year HCCL mooted plans to export about 10 000 tonnes of coking coal per month to South Africa. That followed talks between South African ArcelorMittal and HCCL with a view of importing coking coal from the coal miner for its steel facilities. ArcelorMittal South Africa operations comprise four major facilities, which produce both flat and long steel products. It holds around a 10 percent stake in Hwange. South Africa has a huge appetite for coking coal as it is expanding its energy sector especially in the Limpopo Province. “The target markets for our coking coal are South Africa and overseas markets. Production of thermal, industrial and coking coal is the anchor for the turnaround of Hwange Colliery. Value addition and beneficiation of coking coal into coke and in future coal bed methane will enhance the profitability and growth of the company,” said Eng Makore. He said the resuscitation of the coke oven plant was part of the company’s medium to long term plans. “Our coke oven plant is over 30 years old. It requires technical feasibility studies to determine whether it can be repaired, upgraded or replaced. Then it will need funding for the coke batteries and ancillary plants that produce by-products such as coke oven gas, benzole and tar. “In our strategic planning, this is a medium to long-term project because of the scale of the project. It will also need to align with the potential requirements for additional coke oven gas when Hwange Power Station adds another two boilers. However, it is important for our long-term growth and profitability,” said Eng Makore. The company’s coke oven battery went down in 2008 and was brought to life in 2009 only to stop working four years ago. See picture on Page B4