As South African government announced lockdown for 21 days starting from 26 March’2020 till 17 April, here are the recent updates related to country’s coal sector:
South32 to continue coal mining
While , South32, Perth headquartered coal miner having operations in South Africa Ltd withdrew its full-year earnings guidance, the company has clarified that it will be exempted from a South African government virus lockdown. The miner explained that its work with electricity supplier Eskom Holdings SOC Ltd classes it as an essential business.
“South32 understands that businesses essential for the maintenance of power generation in South Africa are exempt from the lockdown. We will work with the government to determine the impact of this exemption on our South African Energy Coal and South Africa Aluminium operations, given the role they play in the sustainability of Eskom’s generation network,” the company said.
The company said it will update the market with new 2020 production guidance “when further information becomes available”.
Anglo American reviews government orders
Another miner, Anglo American said it is reviewing the impact of the South African government’s national lockdown. The miner said it would look at the detailed regulations related to the government’s order in its home market including exemptions for certain business activities.
The company said, “We recognise the critical role that our operations play in our host operating countries, including in terms of jobs and our local communities. Therefore, we are also working together with the government of South Africa to ensure the continuity of our business where appropriate in order to minimise any unintended consequences of the announced lockdown”.
Other miners such as Buffalo Coal and MC Mining have suspended their mining operations for 21 days lockdown. South Africa’s coal mines and processing facilities operated by Platinum Group Metal (PGM) producers would continue to operate as it supplies fossil fuel to country’s power utility – Eskom.
Power Utility Eskom have enough coal stock
South African power utility Eskom said that coal stocks at its power stations were healthy, with at least 20 days of supplies at all stations. Eskom said all its activities were considered “essential services” under labour law and that it would apply for an exemption from the 21-day lockdown for critical staff. It has asked coal miners, coal transporters and freight company Transnet to continue coal supply operations during the lockdown.
While all the commercial mines will close their operations, mines supplying coal to Eskom would remain in operation, albeit at reduced production rates.
RBCT port continues operations
Amid this lockdown, country’s key port Richards Bay (RBCT) from where coal exports take place is continuing its operations with respect to coal. CoalMint has heard from its reliable sources that the port has thermal coal stock of around 3.7 MnT at present and while commercial coal mining has been suspended for 21 days, the port will continue loading of cargos for the stock at port. However, the buyers in India (a key destination for South African thermal coal exports) are not showing any interest in its purchase given the ongoing 21-days lockdown in India.
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