MC Mining leaps 27% after coking-coal project go-ahead

The share price of MC Mining, headed by industry veteran David Brown, had its biggest leap in nearly seven months on Tuesday after it said it had been given the go-ahead for its Generaal coking and thermal coal project in Limpopo.

The Generaal project with the Chapudi and Mopane projects is the company’s longer-term Greater Soutpansberg Project (GSP) in the Soutpansberg coalfield. It is the second of the mining rights to be granted.

The mining right is a further step in unlocking value from MC Mining’s significant coking and thermal coal assets. It positions the company, formerly Coal of Africa, as a potential long-term coal supplier to local and offshore industrial users, Brown said. MC Mining’s share price closed 27.31% higher at R6.20.

Generaal contains more than 407-million gross tonnes in situ of inferred coal resources and supports MC Mining’s strategy of being SA’s pre-eminent producer of hard coking coal, the company said. Coking coal is used in making steel, and attracts higher sales prices than thermal coal.

The GSP is near the MusinaMakhado special economic zone (SEZ), designated as an area for focus on energy and metallurgical industries. MC Mining is also developing its Makhado project in Limpopo. Once up and running, it will be the country’s most significant hard-coal mine.

The project’s phase one is scheduled to start early in 2020, 10 months after which coal can be sold into the market. Already, MC Mining has an off-take agreement with ArcelorMittal SA for 85% of hard-coal production from phase one.

GENERAAL CONTAINS MORE THAN 407MILLION GROSS TONNES IN SITU OF INFERRED COAL RESOURCES