Coal sales surge for Masama coal mine
Minergy’s Masama Mine has recorded a 110 percent increase in coal sales for the financial year ended June 2021. The development is attributed to increased sales in Botswana, South Africa and Namibia and comes as the mine progress towards nameplate capacity.
For the year ended June 2021, the company sold 416 185 tonnes compared to 198 057 tonnes in 2020 with sales for June 2021 exceeding 56 000 tonnes, a record since inception.
“Average sales pricing back on the mine increased late in the financial year on the back of buoyant international prices and a strengthening South African Rand,” said Chief Executive Officer of Minergy, Morné du Plessis in the company’s condensed group audited financial results for the year ended 30 June 2021.
The significant coals sales is on the backdrop of COVID- 19 pandemic which continues to disrupt border crossings and manning of full production shifts.
Despite these challenges, Minergy has added a new 12- month off- take agreement to the off- take agreements already in place.
“The objective for the 2022 financial year is to achieve nameplate capacity by completing final ramp- up of operations and supporting required steady state volumes. This will enable the Company to generate sufficient cash flow to stabilise the business at break- even or better. The bullish coal market is also providing support,” said du Plessis.
Meanwhile, the company achieved revenue of P193 million compared to P81 million in 2020 with significant improvement in sales volumes
The objective for the 2022 financial year is to achieve nameplate capacity by completing final rampup of operations and supporting required steady state volumes
surpassing 415 000 tonnes sold for the year.
Figures indicate that the performance was divided into two distinct periods with very different operating environments.
The first eight- month period - July 2020 to February 2021 was negatively impacted by delayed funding, COVID- 19 impacts and excessive rain; and the last four- month period of March to June 2021 was a more stable production environment moving toward nameplate capacity.
According to the CEO, production and sales initially recovered in July and August 2020 with the easing of COVID- 19 restrictions and recoveries were further bolstered by the successful launch of the rail siding. Delays experienced in concluding the funding contributed to contractors limiting operations to manage arrears.
“Despite these operational constraints, including the effects of COVID- 19 on logistics and manning of shifts, we expect to reach consistent nameplate capacity in the 2022 financial year,” du Plessis added.
Minergy is working on other prospects which include ongoing Eskom due diligence process and also investigating participation in the request by government to provide a 300MW power station.