Canyon Coal's growth mode
28 September 2017, Johannesburg
PRESS RELEASE
Growth-focused Canyon Coal sees silver lining in tough mining sector
Despite clouds of policy uncertainty and a struggling South African economy hovering over the mining industry, Canyon Coal, a proudly South African junior mining company, is buoyant about the future. The company’s management adopted a long-term view of the sector’s prospects beyond the short-term uncertainty and challenging economic conditions. Canyon’s executive chairman Vuslat Bayoglu believes in focusing on the silver lining to drive an organic and realistic growth strategy.
The strategy is characterised by developing new projects, improving efficiency and output in existing operations, managing risks, exploring new markets, deepening stakeholder relations including with communities where the company operates and being stricter for compliance with regulations. This strategy will see Canyon graduate to a mid-tear-level company by 2020 as it ramps up production from 3. 6 Mton of coal a year to 10 Mton a year.
Canyon owns and operates three collieries: Hakhano, Singani (Middelburg) and Phalanndwa (Delmas) – all in Mpumalanga. Plans are afoot for expansion in the area adjacent to Hakhano to continue using the infrastructure after the existing deposits have been exhausted. The open-cast operations produce bituminous coal for domestic and export markets. Soon to be added to the list of collieries in the Mpumalanga portfolio are Khanye in Bronkhorstspruit and Ukufisa in Springs.
In Gauteng, plans are already at an advanced stage to bring into operation Ukufisa colliery in Springs and Khanye colliery in Bronkhorstspruit. Mining is due to start by the end of 2017 at Ukufisa, where there are coal reserves of 170 Mton and the project promises to be a mega-mine that could include deep mining in the future.
Regulatory authorities have issued Canyon Coal with a water-use license and mining rights for Ukufisa where operations will produce export-grade coal in the RB3 category range. Although Canyon has not yet secured a supply agreement with Eskom, this quality of coal and the mine’s proximity to the utility’s power stations would make it ideal and cost-effective for power generation.
For Witfontein, which holds reserves of 18 Mton, Canyon is awaiting outcomes of the mining right application from the Department of Mineral Resources. De Wittekrans, which was acquired in 2016, boasts 118 Mton of coal reserves. Canyon hopes to secure the transfer of mining rights and approval of the water-user license after which it will start mining during the first half of 2018. Springfield, which is based in Gauteng and expected to operate in 2019, will take place through open cast methods producing approximately 6 Mton of ROM coal per annum for 50 years.
Canyon owns two processing plants whose production capacity can be expanded. One is located in Hakhano and processes coal produced from that operation as well as coal hauled from Singani. The other plant is located in Phalanndwa.
Driving Canyon's growth strategy with Bayoglu are Hakhano and Singani General Manager Guy Thompson, Canyon Group plant manager Jacques Diener and Phalanndwa general manager Alan Mabbett. Their combined vast experience ensures that they are adept at managing risks inherent in any mining operation.
Conscious of the needs of local communities, Canyon prioritises them for job opportunities as well as development initiatives. The company assisted in the building of Bonginhlanhla Simulation Centre for Disabled Children, near Hakhano and Singani collieries. It cares for 35 children with physical and learning needs. Bursaries are provided for talented young people from poor households.
After a child and an adult drowned while crossing an overflowing river in Delmas, Canyon helped to build Given Diko footbridge, named after the child who drowned, to assist learners and other pedestrians to cross safely.
Canyon’s management believes that sustainable mining is not only about extraction of monetary value; it is also about creating a positive legacy. This approach to mining has also ensured that Canyon has adhered to environmental legislation, safety standards and healthy labour relations practices. Mr. Bayoglu says “we are a good South African corporate citizen.”
Tel: +27 11 783 7996
