| Wed 11 Jul 2007, 9:00 | | ARI - African Rainbow Minerals - ARM Coal And Xstr |
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ARI
ARIM
ARI - African Rainbow Minerals - ARM Coal And Xstrata Coal To Develop R2.9
Billion Goedgevonden Open Pit Coal Mine
African Rainbow Minerals Limited
(Incorporated in the Republic of South Africa)
(Registration Number 1933/004580/06)
JSE Share code: ARI
ISIN: ZAE000054045
("ARM" or "the Company")
ARM COAL AND XSTRATA COAL TO DEVELOP R2.9 BILLION GOEDGEVONDEN OPEN PIT COAL
MINE
African Rainbow Minerals Limited (ARM) and Xstrata Coal today announced the
development of a major new greenfield, open cut, thermal coal mine,
Goedgevonden, at a total investment of ZAR2.9 billion (US$392 million).
At full production, the Goedgevonden mine will produce 3.1 million tonnes per
annum (mtpa) of export thermal coal, 3.6mtpa suitable for the domestic thermal
markets and will have a mine life in excess of 30 years. The mine is located in
the Witbank coalfield, in the Mpumalanga province.
The mine will be developed through a majority black-owned and controlled joint
venture, the "Goedgevonden JV", in which ARM Coal owns a 51% share. Xstrata Coal
South Africa owns the remaining 49%.
ARM Coal is a black-owned and controlled coal mining company created in February
2006 and is 51% owned by African Rainbow Minerals Limited. ARM will appoint the
majority of representatives on the Goedgevonden JV management committee, in line
with its majority interest. Xstrata Coal will manage the Goedgevonden Project on
behalf of the Goedgevonden JV. Xstrata Coal Marketing AG will market all export
coal produced by the mine.
Commissioning of the new mine is expected in the first half of 2009, with full
production anticipated from 2011.
Xstrata Coal is facilitating ARM Coal`s participation in the Goedgevonden
project by providing all funding required to reach commissioning. Xstrata Coal`s
funding will be on preferential terms through the use of interest and capital
repayment holidays. ARM Coal has been successful in obtaining 3.2 mtpa export
capacity for the Goedgevonden project in the revised Phase V expansion of
Richards Bay Coal Terminal.
It is anticipated the project will create over 1,100 jobs during the
construction phase and 300 permanent jobs when fully operational. The
Goedgevonden JV and ARM Coal will also make a significant contribution to the
sustainable development of communities associated with the operation, in
particular in maximizing local employment and procurement, and through
supporting the development of small and medium enterprises.
Patrice Motsepe, Executive Chairman, African Rainbow Minerals, said, "We are
delighted to announce the development of this major greenfield export project.
This is a significant milestone for the ARM growth programme, particularly with
respect to our recent investment into coal."
Peter Coates, Xstrata Coal Chief Executive, said, "The Goedgevonden mine is the
first of its kind to be undertaken by a majority black-owned and controlled
company, will benefit from state of the art infrastructure and be a high
productivity, low operating cost business.
"Goedgevonden will be very competitive in the Atlantic market and is well
positioned to compete in the domestic thermal market, given that the JV fully
complies with BEE procurement criteria. This significant investment marks
Xstrata Coal`s commitment to growing our South African coal business in
partnership with ARM Coal, through structures that facilitate ongoing black
economic and management participation."
Advocate Sandile Nogxina Director General, Department of Minerals and Energy,
said: "The Goedgevonden project represents meaningful majority black
participation in the growth of South Africa`s important coal industry. This new
mine will provide an ongoing source of wealth creation for our nation for over
30 years and represents an important foreign investment for the Mpumalanga
province and the country as a whole."
For more information please contact:
Mangisi Gule or Pieter Rorich
CEO: ARM Coal Executive Director: Investor
Relations and New Business
Development
Telephone: +27 11 779 1263 Telephone: +27 11 779 1476
Mobile: +27 82 805 3863 Mobile: +27 82 570 5064
E-mail: mangisi.gule@arm.co.za E-mail : pieter.rorich@arm.co.za
Notes to editors
Xstrata Coal is the world`s largest producer of export thermal coal and the
third largest exporter of thermal coal from South Africa, producing almost 20%
of all thermal coal exported. Headquartered in Sydney, Australia, Xstrata Coal
has interests in 32 operating coal mines, 13 of which are located in South
Africa. Xstrata Coal is part of Xstrata plc, a major global diversified mining
company, listed on the London and Swiss stock exchanges with a market
capitalisation of approximately US$45 billion.
African Rainbow Minerals Limited (ARM) is a niche, diversified South African
mining company with excellent long-life, low-cost operating assets in key
commodities. ARM owns ferrous and base metals, platinum and coal operations and
holds a significant interest in the gold mining sector through its shareholding
in Harmony. ARM subsidiary, TEAL houses ARM`s non-South African exploration
portfolio. ARM is listed on the JSE Limited in Johannesburg, South Africa.
Johannesburg
11 July 2007
Issued by sponsor: Deutsche Securities (SA) (Proprietary) Limited
Date: 11/07/2007 09:00:02 Produced by the JSE SENS Department.
