The deal is set to create scores of jobs as the coal miner will again begin to supply coal to Eskom.
Coal miner Wescoal holdings limited has announced it has received the government’s approval to own 50% of Arnot coal mine.
Arnot was closed down by Exxaro Resources in 2015 after the company failed in its efforts to negotiate a new coal supply agreement with Eskom.
Wescoal announced it had bought a 50% stake, taking over the assets, liabilities and the employees in the Mpumalanga operation.
The stake was bought from Exxaro Coal Mpumalanga Proprietary in partnership with a company called Innovators Resources Proprietary Limited.
Mineral resources minister Gwede Mantashe approved the acquisition a week ago, Wescoal said.
They were waiting for the minister’s green-light with regards to mining rights for transactions to go ahead.
Wescoal said Mantashe’s approval came last Friday (26 Apr).
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The only one thing left is for Arnot to be transferred to a company called Arnot OpCo. All agreements and rights will now be held by Arnot OpCo.
The partnership between Wescoal and Innovators Resources comes as a way of sort of compensating the hundreds of workers who were affected by the December 2015 shutdown. They got retrenched.
The workers are the shareholders in the company Innovators Resources and a week ago they had Mantashe handing over the shares to them.
“Importantly,” Wescoal said, “this is a significant broad-based empowerment transaction which will secure employment and provide employees and communities around the mine with equity participation as outlined in the Mining Charter III and we are excited that Wescoal Mining is the enabling partner in the relationship with IR”.
Arnot Mine is near the Arnot power station and coal can be delivered to the power station through a conveyer belt, it said.
“[This will] result in a cost competitive advantage with minimum carbon emissions environmental impact.
“In this regard, Arnot OpCo has responded on 2 April 2019 to the Eskom Request for Proposal (RFP) to supply coal to the Arnot Power Station.”
(edited by ZK)
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