Modern Mining November 2022

from Masama Mine

As it stands, the company’s mining licence cov ers its 390 mt Masama resource, which has a plus 100-year LOM. In a bid to raise capital, the miner is considering a listing on an international bourse, which Du Plessis says will “inject fresh cash into the business” to be used primarily to increase production and to refi nance the expensive debt it currently carries. Following the return in interest to fund coal proj ects, Du Plessis is eager to begin preparations for a listing which would either be on the Australian or a European bourse in the next 12 months. “A secondary listing on an internationally recog nised stock exchange remains an important strategic objective for Minergy,” he said. Further to this, Minergy has partnered with Jarcon Power and has submitted a bid for a new 300 MW greenfields coal-fired power plant in Botswana. The government, through the Ministry of Mineral Resources, Green Technology and Energy Security, invited the company’s subsidiary, Minergy Coal, and three other selected local bidders to tender for the design, finance, construction, ownership, operation, maintenance and decommissioning at the end of its economic life, as an independent power producer. “If the bid is successful, Minergy will be respon sible for providing coal to the power plant for the duration of the power purchase agreement of 30 years, while other income streams are also envis aged,” says Du Plessis, adding that this profitable sale of coal will have the benefit of ensuring a steady cash flow to Minergy and diversifying income streams. 

The company is geared to produce 125 000 tpm ROM and around 70 000 tpm saleable product.

Minergy has sold more than 1.3 mt of coal since 2019.

Strong demand for coal has seen the commodity trading well above $300/t for RB 1 coal specification, far above the $45 – $47/t it traded just prior to the onset of the pandemic. “As a result of the Russia-Ukraine war, the price of coal at its peak traded at over $400/t and as there isn’t an end in sight to the war, people are revisiting where and how they will source their energy.” The coal miner is well placed to supply into inter national markets, with its flagship asset geared to produce 125 000 tpm ROM and around 70 000 tpm saleable product. “For the past two months we have been produc ing between 70 and 75 000 tpm of saleable product, which is above break-even. The opportunity exists to mine more; however, the project is stymied by lim ited plant capacity. We are currently evaluating the potential of expanding the plant’s capacity, but this comes with funding requirements.” Coupled with capital constraints, Minergy remains challenged by the availability of water, as the Waterberg region is a water scarce region. “Clearly, we would like to expand, in fact, double ROM production to 250 000 tpm with 150 000 tpm saleable product, but we remain constrained by access to funding and water availability,” says Du Plessis.

“Clearly, we would like to expand, in fact, double ROM production to 250 000 tpm with 150 000 tpm saleable product, but we remain constrained by access to funding and water availability,” says Du Plessis.

November 2022  MODERN MINING  13