MC Mining reported a mixed performance for the quarter to end-March, with its Makhado project progressing well towards commissioning, while the Uitkomst steelmaking coal colliery faced challenges.
In a statement on Wednesday, the company said Makhado, a hard coking and thermal coal project in Limpopo, remained on track for commissioning in December.
Key infrastructure milestones included completing a temporary access bridge, installing 14km of power lines, and advancing construction of the coal handling plant. Exploration at the East Pit identified an additional coal seam, “potentially extending the mine’s 28-year life”, the company said.
In contrast, the Uitkomst colliery, a producer of thermal and metallurgical coal in KwaZulu-Natal, produced less coal than expected, with a 13% decline compared to the same period last year. This was due to narrower coal seams and equipment availability issues. However, the company did see an improvement in coal processing efficiency, with yields increasing from 60% to 73% during the quarter.
Financially, the company said its cash position improved to $9m (R167.5m), up from $4m in the previous quarter. They received $20m from an investor, contributing to this increase. The company also made repayments of $7-$8m to the Industrial Development Corporation (IDC).
The company said it was facing a challenging market environment, including low global demand for hard coking coal due to reduced steel production in China and alternative technologies. It was, however, well-positioned to supply SA’s steel industry.
The company said its priorities included completing Makhado on time to start production in the 2026 financial year. It also said it was working to finalise a loan restructuring agreement with the IDC by June.
Formerly known as Coal of Africa, MC Mining is listed on the JSE, the Australian Securities Exchange, and the AIM of the London Stock Exchange.
In March, the company announced shareholder Kinetic Development Group (KDG), a Hong Kong-listed coal mining and trading company, had increased its stake to a controlling 51% from 13.04% for about $77m. The company said the investment would provide MC Mining with the funding to develop Makhado.
The hard coking coal expected to be produced from it had the potential to become a significant supplier to the global steel industry, the company said previously.
Besides Makhado and Uitkomst Colliery, MC Mining owns Vele Aluwani Colliery — a semisoft coking and thermal coal colliery in Limpopo, and the Greater Soutpansberg projects, which produce coking and thermal coal near Makhado.
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