Makhado Coal Mine

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Makhado Coal Mine is a proposed opencast, coking coal mine project in Limpopo Province, South Africa.[1]

Location

The map below shows the approximate location of the project, near Mudimeli, in Makhado municipality, Vhembe district, Limpopo province, South Africa.[2]

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Background

The Makhado coal project is a coal mine project located in the Soutpansberg coalfield, in South Africa's Limpopo province. It is owned by MC Mining, formerly Coal of Africa Limited, and is the company's flagship project. The mine has estimated recoverable reserves of 188.3 million tonnes (Mt).[3]

Due to the project's lack of support by major international financial institutions, Makhado will be developed as a two-phased plan. Phase 1 includes Makhado's coal being processed at the existing Vele Colliery plant at a production rate of 0.54 million tonnes per annum (Mtpa) of hard coking coal, and 0.57 Mtpa of thermal coal. Phase 2 includes the construction of a new processing plant, and is expected to generate 1.7 Mtpa of saleable coal (0.8 Mtpa of which will be hard coking coal).[1]

According to MC Mining, once operation commences, Makhado will be the only significant hard coking coal producer in South Africa, which has obvious advantages for South African steel producers.[1]

Delays

The project was granted environmental permits in 2013. However, Coal of Africa Limited had severe cash flow problems in the following years, and was unable to start mining at any of its projects, including both Makhado and Vele.[4] In July 2016, the company was granted an amended environmental permit; and in September 2018, the project's permit was amended to include transport of coal via road.[5] (In April 2019, Mining Journal reported that MC Mining "got the news that the appeal by a "narrow interest group" against the Makahdo EA amendment allowing for the transportation of coal to Musina by road rather than rail, had been unsuccessful."[6])

In March 2019, MC Mining received approval from its board of directors to move forward on the project. At the time, the company stated that it was lining up financing, and would begin construction in the third quarter of 2019 with production starting in June 2020.[5][7] This plan, however, did not pan out, and the project's timeline was revised several more times due to issues with securing funding for the $32m Makhado project.[8][9][10] Funding initiatives were also delayed due to the Covid-19 pandemic.

According to MC Mining's 2021 annual report, phase 1 construction is now planned to begin in Q2 of 2022, however, potential funders are still being explored.[11] Phase 2 development is tentatively scheduled for 2026.[1]

Phase 1 Mine Details

  • Operator: MC Mining
  • Owners: MC Mining (67%), Makhado Colliery Community Development Trust (20%), a black industrialist (6%), South African Industrial Development Corporation (6.7%)[1]
  • Location: 36 km north of Makhado and 80 km southeast of the Vele Colliery, in Vhembe District, Limpopo Province, South Africa
  • GPS Coordinates: -22.7999984, 29.9141726 (Approximate)
  • Mine Status: Proposed
  • Start Year: 2022 (Phase 1); 2026 (Phase 2)[1]
  • Production Capacity: 1.11 Mtpa (0.54 Mtpa of hard coking coal, 0.57 Mtpa thermal coal)
  • Total Resource: 344.8 million tonnes[1]
  • Mineable Reserves: 188.3 million tonnes (Mt)[3]
  • Coal Type: hard coking coal and export-quality thermal coal
  • Mine Size: 8,190 hectares[12]
  • Mine Type: Surface, opencast
  • Number of Employees: 650 (expected)[3]
  • Source of Financing: Industrial Development Corporation of South Africa Limited (IDC)[1]

Phase 2 Mine Details

  • Status: Proposed
  • Production Capacity: 1.7 Mtpa[1]
  • Mineable Reserves:
  • Start Year: 2026[1]

Articles and resources

References

  1. 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 MC Mining 2021 Annual Report, MC Mining website, accessed October 2022.
  2. MC Mining Annual Report 2019, 23 Oct 2019, MC Mining website, accessed Nov 2019.
  3. 3.0 3.1 3.2 Makhado Project, MC Mining website, accessed October 2019.
  4. Coal in southern Africa: MC Mining, new name and new focus, Mining Review Africa, 6 Mar. 2018.
  5. 5.0 5.1 Makhado Project, MC Mining website, accessed June 2019.
  6. Jacqueline Holman, Good news for MC Mining's Makhado, Mining Journal, 17 Apr 2019.
  7. MC Mining gets approval for Makhado coal mine development, Mining Technology, 14 Mar. 2019.
  8. AMSA Signs Offtake for Coking Coal from MC Mining's Makhado Phase 1, Mining Weekly, 19 Jun. 2019.
  9. "MC Mining secures funding for Phase 1 of Makhado", Mining Review, 15 Jul. 2019.
  10. "MC Mining expects to fully fund R518m Makhado coal project by end-June," "Mining Mx," March 13, 2020.
  11. Consolidated Annual Financial Statements for the year ended 30 June 2022, MC Mining website, accessed October 2022.
  12. Makhado Coal Mine, Vhembe District, Limpopo Province, Mining Technology, accessed 22 Oct. 2019.

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