Eh? loads of rubbish posts (able year)
Overview
In 2003 South Africa produced 237,544,908 t of Bituminous and 1,206,105 t of
anthracite, however, the rand's strength against the dollar resulted in
sharp cuts in rand profits and revenues for South Africa's coal producers.
Ready availabilty of coal on world markets affected South Africa's export
mines until late 2002. South Africa's coal industry is the second biggest
mining sector after gold, with sales contributing 16% of export revenue in
2003 (ZAR 20 billion in 2000) to South Africa's mineral sales and 4% to the
GDP. Coal production for 2003 was estimated at at 232.9 million tons
compared with 220.2 million tons in 2002. Coal sales for 2003 were estimated
at 26.86 billion. South Africa's coal production rose 6% in 2003 but despite
this the 18% decrease in the rand price of coal meant a decrease in coal
revenues. During 2003 the average price received for a ton of South African
thermal coal was R187,70 a ton down from R258,40 in 2002. South Africa is
the world's second largest coal exporter, after Australia, as well as second
lowest cost producer, after Indonesia. Approximately 64 Mt of coal was
exported in 2001 out of a total production of 225 Mt. Bituminous or steam
coal remains South Africa's main export coal, with anthracite having to be
imported, due to diminishing reserves. 60% of South Africa's coal exports
are currently destined for the European market. Most of the coal produced is
consumed locally, with the power generation using 41% of total production.
Out of the 150 - 160 Mt of coal produced for the domestic market, Eskom
helped itself to 92 Mt and Sasol 51Mt (2000). The remainder is used in the
metallurgical industry and for domestic use.
Mostof South Africa's export coal is dispatched through the Richards Bay
Coal Terminal (RBCT) on the Kwazulu Natal north coast. RBCT has an expansion
programme which should result in its annual handling capacity being
increased by 10 Mt by 2006 Two thirds of this expanded capacity is to be
allocated to smaller producers. The South Dunes Coal Terminal (SDCT) is also
planned to accommodate smaller exporters, being able to handle 12 Mt/year.
The Maputo Port (Mozambique) has also began to be used for export purposes
with 2Mt being shipped in 1999. Durban's Matola facility hopes to increase
export capacity to 6.5 Mt per year, up from the present 1.5 Mt.
South Africa has limited coal reserves. An estimated 34 billion tons remain,
and based on present consumption rates, South Africa could have a mere 7
billion tons remaining by 2040. (In 1982, reserves were estimated at 50
billion tons). South Africa's coal reserves are hosted by Karoo age
sediments, which cover most of Southern Africa and are responsible for the
coal deposits mined at Wankie in Zimbabwe and Maamba in Zambia. South Africa
's coal mines are situated in the Mpumalanga, Free State, northern Kwazulu -
Natal and Northwest provinces. Most collieries are concentrated around the
towns of Witbank, Ermelo and Secunda.
Market Structure
As in the South African gold industry, the coal sector has undergone similar
mergers, acquisitions and name changes over the past few years. What has
emerged are three major coal producers and exporters, viz. Anglo American
Coal (Anglo Coal), Ingwe (a BHP Billiton subsidiary) and Xstrata (previously
Duiker, with Swiss Glencore International as a major shareholder).The
entrance of a black consortium Eyesizwe Coal was pre empted by Ingwe and
Anglo Coal, involving several properties. Eyesizwe will be producing coal
for the local market, producing 18Mt annually, with resources of 4 - 5
billion tons, representing 8% of South Africa's resources and making it
South Africa's fourth largest producer. Eyesizwe's major coal producer is
the Matla Colliery, which produces 12Mt / year, most of which supplies the
nearby Matla Power station. Other collieries include New Clydesdale, Glisa,
and the underground operation of Arnot.
Although traditionally seen as an electricity generator and distributor,
Eskom may be entering the local and export coal market. Based on its
extensive stockpiles (estimated at 20Mt) as well as interests in a
developing coal mine located at Usutu on the border between Mpumalanga and
KZN, Eskom could become South Africa's latest producer. Eskom has signed an
agreement with Dutch based Anker to develop a small high grade export
operation near Usutu.
The unbundling of Iscor's steel and mining divisions into separate companies
has resulted in the formation of Kumba Resources that operates three
facilities in South Africa. Kumba are in talks with Eyesizwe regarding
synergies between the two companies.
In 2003 the owners of Kangra, a privately owned coal-mine operator, sold 25%
of their interest to MCI Resources a black empowerment company. Other sales
to black empowerment firms were: BHP's sale of the Delmas colliery Anglo
American$#146;s sale of its entire Kwazulu Natal reserves.
In 2003 Spoornet announced rail tarrif of 60% for deliveries to the Maputo
and Durban harbours. This resulted in the closure of some smaller export
mines that could not handle the increased costs. However Metorex quadruppled
its coal exports to 500 000 t/y through Maputo.
In 2003 Xstrata spent US$60.1 million on developing its properties in South
Africa.
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