| Wed 31 Mar 2010, 10:56 | | EXX - Exxaro - Medupi Coal Supply And Off-Take Agreement Update |
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EXX - Exxaro - 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: 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 Resources Limited (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 would 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). At the time, Exxaro`s capital
expenditure for the Grootegeluk Medupi Expansion Project was 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.
On 8 December 2009 Exxaro advised its stakeholders that Eskom had formally
requested Exxaro to review certain of the commercial terms of the CSA and Exxaro
further noted that this had resulted in it temporarily suspending its
Grootegeluk Medupi Expansion Project funding programme as well as the placement
of additional contracts associated with the Grootegeluk Medupi Expansion
Project.
Exxaro is pleased to announce that the review of the Medupi CSA has been
finalised and that Exxaro and Eskom signed a definitive agreement on 26 March
2010. In terms of the revised agreement, the delivery of first coal is planned
for the second quarter of 2012 with a ramp-up to full production by 2015. This
ramp-up is now in line with the commissioning and commercial operation date of
the first unit of the power station.
Exxaro will now resume its funding programme as well as the placement of
additional contracts for the Grootegeluk Medupi Expansion Project. 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 for a period of 40 years.
The agreement is subject to the fulfilment of certain suspensive conditions,
including the respective companies` board approvals and Exxaro securing its
funding.
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:
Ernst Venter
Executive General Manager: Business Growth
Tel: + 27 (0) 12 307 4322
Mobile: +27 (0) 83 609 1313
Email: ernst.venter@exxaro.com
Pretoria
31 March 2010
Sponsor
Deutsche Securities (SA) (Proprietary) Limited
Date: 31/03/2010 10:56:01 Produced by the JSE SENS Department.
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