| Tue 8 Dec 2009, 8:09 | | EXX - Exxaro Resources - News Release - Medupi Coal Supply and off-take |
|
EXX
EXX
EXX - Exxaro Resources - News Release - Medupi Coal Supply and off-take
agreement update
EXXARO RESOURCES LIMITED
(Incorporated in the Republic of South Africa)
(Registration Number: 2000/011076/06)
JSE share code: EXX
ISIN code: ZAE000084992
ADR code: EXXAY
("Exxaro")
NEWS RELEASE - MEDUPI COAL SUPPLY AND OFF-TAKE AGREEMENT UPDATE
Exxaro Coal (Pty) Limited, a wholly owned subsidiary of diversified South
African-based resources group Exxaro, and Eskom Holdings Limited ("Eskom"),
signed the Medupi Coal Supply and Off-take Agreement ("CSA") on 19 September
2008. In terms of the CSA, Exxaro will supply an average of 14.6 million tonnes
per annum of power station grade coal to Eskom`s new Medupi base-load power
station, under construction near Lephalale, Limpopo province, from a brownfields
expansion project at Exxaro`s Grootegeluk mine ("Grootegeluk Medupi Expansion
Project").
Exxaro`s capital expenditure for the Grootegeluk Medupi Expansion Project is
estimated at R9 billion and delivery of first coal was planned to commence in
the fourth quarter of 2011 with a ramp-up to full production by 2014.
Exxaro has received notice from Eskom that it is seeking to review certain
commercial terms contained in the CSA, including the coal price escalation
mechanism and the coal delivery ramp-up. Indications are that the date for first
coal delivery to the power station, in terms of the CSA, has been confirmed to
be during the first half of 2012, aligned to the commercial start-up of the
power station. Exxaro is in separate discussion with Eskom with regard to the
delivery of early coal from July 2011, to be used by the power station for pre-
commissioning tests and the creation of stock-piles. Pending the outcome of the
review process, Exxaro will temporarily suspend its funding programme as well as
the placement of additional contracts associated with the Grootegeluk Medupi
Expansion Project.
Addenda to the CSA have been signed by the parties to extend the fulfilment of
various suspensive conditions. Currently all suspensive conditions are to be
fulfilled by 26 February 2010.
Ends
Editor`s Note: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.
www.exxaro.com
Enquiries:
Wim de Klerk
Financial Director
Tel: + 27 (0) 12 307 4848
Mobile: +27 (0) 82 652 5145
Email: wim.deklerk@exxaro.com
Pretoria
8 December 2009
Sponsor
Deutsche Securities (SA) (Proprietary) Limited
Date: 08/12/2009 08:09:01 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
