| Fri 19 Sep 2008, 10:00 | | EXX - Joint News Release - Eskom And Exxaro Sign Coal Supply Contract For |
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EXX
EXX
EXX - Joint News Release - Eskom And Exxaro Sign Coal Supply Contract For
Medupi Power Station
Exxaro Resources Limited
Registration number: 2000/011076/06
JSE share code: EXX
ISIN code: ZAE000084992
ADR code: EXXAY
JOINT NEWS RELEASE
ESKOM AND EXXARO SIGN COAL SUPPLY CONTRACT FOR MEDUPI POWER STATION
State-owned power company Eskom and diversified resources group Exxaro
Resources Limited (Exxaro) today signed the coal supply agreement for Eskom`s
new base-load power station, Medupi Power Station, situated at Lephalale,
Limpopo province.
Exxaro`s capital expenditure for the project is estimated at R9 billion and
production is planned to begin in the third quarter of 2011 with a ramp-up to
full production by 2014.
In terms of the agreement, Exxaro`s Grootegeluk mine, will over the next 40
years, supply an average of 14,6 million tonnes per annum of power station
grade coal to Medupi. The coal to Medupi will be supplied through a
brownfields expansion of Grootegeluk mine with mining from the existing
opencast pit continuing at an accelerated rate. The coal beneficiation
process will be handled via two new dense medium facilities (Grootegeluk 7
and Grootegeluk 8 beneficiation plants) which will be constructed at the
mine.
"The investments by both Eskom and Exxaro will have a significant benefit to
the local, provincial and ultimately the South African economy. Direct jobs
created during construction by both investments will peak at about 9 500 with
the Eskom investment generating 8 000 and the Exxaro investment generating
1 500 of these jobs. Furthermore, thousands of indirect jobs will also be
created during the construction of the power station and the expansion of the
mine," says Jacob Maroga, Chief Executive of Eskom.
"We value the co-operative and long-standing relationship that has developed
between Eskom and Exxaro and are pleased to be able to continue this mutually
beneficial relationship," says Sipho Nkosi, Exxaro`s Chief Executive Officer.
"We estimate that about 550 permanent jobs will be created at the Grootegeluk
mine," added Nkosi.
The technical and commercial teams have negotiated an agreement that has been
ratified and approved by both the boards of both Eskom and Exxaro.
Medupi is the first of Eskom`s new generation base-load coal-fired power
stations and it will comprise of six 800MW generation units capable of
supplying 4 800MW of generation capacity to the national grid. Medupi will
be the largest air-cooled power station in South Africa and its first
generation unit is scheduled for commercial operation during the last quarter
of 2011, with the last unit expected to be in operation in the first half of
2014.
ends
Editor`s Notes:
Exxaro
Exxaro is one of the largest South African-based diversified resources
groups, with interests in the coal, mineral sands, base metals, industrial
minerals and iron ore commodities. The group is the largest supplier of coal
to Eskom and currently also supplies the Matimba power station with about
14,6Mtpa of coal from its Grootegeluk mine. www.exxaro.com
Eskom and the Medupi Power Station
Eskom, the state owned electricity utility, is in the process of a major
capital expansion programme to ensure the sustainability of supply of
electricity. The Medupi sod-turning celebration was held in August 2007 and
since then site work has proceeded as scheduled. The boiler contract was
awarded to Hitachi Power Africa in October 2007 and the turbine order has
been placed with Alstom S&E.
Enquiries
Exxaro: Eskom:
Trevor Arran Fani Zulu
Executive General Manager: Senior General Manager:
Corporate Affairs & Strategy Group Communications
Tel: +27 12 307 3292 Tel: +27 11 800 2265
Mobile: +27 83 609 1444 Mobile: +27 82 451 0457
E-mail: trevor.arran@exxaro.com Email: fani.zulu@eskom.co.za
Ernst Venter
Executive General Manager:
Business Growth
Tel: +27 12 307 4322
Mobile: +27 83 609 1313
E-mail: ernst.venter@exxaro.com
19 September 2008
Sponsor:
J.P. Morgan Equities Ltd
Date: 19/09/2008 10:00:01 Produced by the JSE SENS Department.
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