New Largo Coal Mine

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The New Largo coal mine is an opencast coal mine 15 kilometers north of Emalahleni in Mpumalanga Province, South Africa.[1]

Location

The map below shows the approximate location of the mine in Victor Khanye municipality, Nkangala district, Mpumalanga province, South Africa.

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Background

In 2007, the New Largo coal mine was expected to produce 10–16 million tonnes of coal per year (Mtpa), and has estimated recoverable reserves of 585 million tonnes (Mt). As the closest mine to Kusile Power Station[2], Anglo American had planned for it to provide coal to the power plant.[3][4] In the minutes of a stakeholder briefing in 2009, South Africa's Eskom power utility stated that they "will obtain most of the coal required for Kusile Power Station from Anglo Coal's New Largo operations, south east of the Kusile Power Station."[5]

In 2018, Anglo Coal sold it for $65 million to New Largo Coal Proprietary Limited, a consortium made up of Black-majority-owned companies Seriti Resources and Coalzar, as well as the Industrial Development Corporation of South Africa.[6] With respect to this transaction, S&P Global reported that "Anglo American Plc agreed to sell its New Largo thermal coal project and the Old New Largo closed colliery in South Africa."[7] The "New Largo thermal coal project" and the "Old New Largo closed colliery" are likely one and the same: The New Largo coal mine originated in discussions between Eskom and Anglo American in 2006 but was still being referred to as a "greenfield project" -- a minimally or unexplored project -- in August 2014,[3] even though some outlets referred to it as the "New Largo colliery."[8]

In August 2019, New Largo Coal intended to develop the New Largo Mining right into a large scale, long life coal mine in order to supply ~12 Mtpa coal to Eskom’s Kusile Power Station over a 50-year period[9], but the cost to do so was not yet determined.[10] Reporting on plans for "crisis-hit state power utility Eskom"[11] in November 2019, Mail & Guardian suggested that Eskom will finally be funding New Largo.[12]

"Eskom is yet to say which tied mines it intends funding, but it most likely is the undeveloped New Largo mine, owned by Seriti Resources. It is adjacent to the floundering Kusile power station in Mpumalanga. Eskom intends negotiating a contract with Seriti Resources next year for what reportedly will be a giant mine that will cost R20-billion to develop."[12]

As of October 2022, Seriti reports that limited mining operations have commenced at New Largo.[1] Once production fully ramps up, the colliery, which uses dragline strip mining, will supply Eskom’s adjacent Kusile power station with around 12 Mtpa of thermal coal over a 50-year period.[1]

Project Details

  • Operator: New Largo Coal
  • Owners: Seriti (67.5%), Industrial Development Corporation (22.5%), New Largo Coal Employee Trust (5%), New Largo Coal Community Trust (5%)[1]
  • Location: Near Balmoral, in Emalahleni Municipality, Nkangala District, Mpumalanga Province, South Africa
  • GPS Coordinates: -25.9052929, 28.9732141 (approximate)
  • Mine Status: Operating
  • Start Year: 2022[1]
  • Production Capacity: 12 Mtpa[13]
  • Total Resource: 585 million tonnes[1]
  • Mineable Reserves:
  • Coal Type: Bitunimous (Thermal)
  • Mine Size:
  • Mine Type: Opencast
  • Source of Financing:
  • Number of Employees:

Articles and resources

References

  1. 1.0 1.1 1.2 1.3 1.4 1.5 Our Business: New Largo, Seriti website, accessed October 2022.
  2. South32 mine could solve Kusile hurdle, Business Day, 7 Sep 2017.
  3. 3.0 3.1 Anglo American Coal South Africa, Anglo American investor presentation, Aug 2014.
  4. Hillary Joffe, "New BEE owners of New Largo could find themslves at the coalface of a struggling sector," BusinessDay, 1 Feb 2019
  5. Eskom Holdings Ltd, "Second Key Stakeholder Meeting between Eskom and Topigs SA", 19 Aug 2009.
  6. Anglo American Completes Sale of New Largo Thermal Coal Project in South Africa, Anglo American press release, 1 Aug 2018.
  7. Fawad Mir, Anglo to off-load New Largo thermal coal project for 850M rand, S&P Global Market Intelligence, 29 Jan 2018.
  8. David McKay, Eskom, Anglo to seal deal on New Largo, Miningmx, 5 Dec 2013.
  9. Project Background, New Largo Coal website, accessed Nov. 2019.
  10. Seriti May Turn to Equipment Makers as Coal IPOs Shunned, Bloomberg News, 26 Aug 2019.
  11. Sabelo Skiti, What did Gordhan’s Eskom plan really mean?, Mail & Guardian, 29 Oct 2019
  12. 12.0 12.1 Kevin Davie, Bankrupt Eskom to fund new coal, Mail & Guardian, 08 Nov 2019
  13. "Mike Teke’s Seriti Resources gives dignity back to South Africa," "Mining Review Africa," January 29, 2020.

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