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Continental Coal releases production updates for its three mines

Oilfield Technology,

Continental Coal Ltd, a South African thermal coal miner, has provided a update on mine production and development activities at the company’s third operating coal mine, the Penumbra coal mine, and an update on operating performance at its Vlakvarkfontein and Ferreira coal mines and Delta processing operations in South Africa.

Penumbra coal mine

The company increased ROM coal production in January 2013 to 14,031 t, compared to 2694 t in the previous month. ROM coal has been processed through the Delta processing operations with primary export yields of 37.2% achieved in January 2013, up from 26.2% in December. Primary export yields of 67% are forecast once the Penumbra mine has achieved steady state operating levels by June 2013.

Export sales from Penumbra have continued over the month and in January 2013 totalled 5212 t, compared to 854 t in the previous month.

The company will commission the second Joy 14HM15 continuous miner underground this month. This will result in production by the end of February of 20,000 – 25,000 and 35,000 – 40,000 t in March 2013. Monthly budgeted ROM production of about 63,000 t is forecast by June 2013.

Penumbra is forecast to produce 750,000 tpa of ROM coal over an initial 10 year mine life at forecast average total FOB costs of Rand 490/t (May 2011 terms; about US$ $57/t). The ROM production will be beneficiated through the Delta processing operations, which comprises a 1.8 million tpa coal processing plant and the 1.2 million tpa Anthra rail siding. Sales of 500,000 tpa of a high quality export thermal coal RB1 specification coal product are forecast.

Ferreira coal mine

Production at the Ferreira coal mine was 56,886 t in January, more than 20% above budget and 12% above the average monthly ROM production achieved in Q4 2012. Year-to-date total FOR costs have continued to remain below budget and have averaged Rand 563/sales t (about AU$ 63/t and 12% below budget).

Vlakvarkfontein coal mine

ROM coal production at the Vlakvarkfontein coal mine was 103,751 t in January, in line with the average monthly ROM production achieved in Q4 2012.  Total thermal coal sales of 111,992 t exceeded budget, with 96,172 t for Eskom and 15,820 t of non-select coal sales. Vlakvarkfontein is forecast to exceed budgeted ROM production and thermal coal sales for FY2013.

Year-to-date mining costs at Vlakvarkfontein have averaged Rand 78/t ROM (approx. 22% below budget). Total FOT costs year to date have averaged Rand 126/sales t (approx. 10% below budget). Average sales price received year to date was Rand 181/t.

Adapted from press release by Jonathan Rowland.

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