The state owned mining company recently launched in South Africa is hoping to start producing coal to the tune of 800,000 metric tons of coal by June this year. The African Exploration, Mining and Finance Corporation or AEMFC hopes to produce coal for Eskom Holdings the country's electric utility from a new coal mine in Vlakfontein.
The AEMFC Chief Executive officer Sizwe Madondo said that the coal mine located 80 km east of Johannesburg would have an output of 1.68 mta. The mining company hopes to eventually raise the production to 3 mta. The cost of the new mine would be about 130 million rand which equals about $ 18.5 million.
The funding for the project will come from the Central Energy Fund. The main subcontractor for the new mine will be Concor Holdings, which is a subsidiary of Murray & Roberts Holding. AEMFC is likely to secure an agreement with Eskom at a preferential rate with both companies being state owned.
In response to the new state owned mining company Mines Minister Susan Shabangu said that they could no longer afford for us as a country to continue to have strategic assets such as coal, uranium, to be mined by privately owned. She added that they would allow private participation, but government must determine the future.