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Acacia Coal to buy Riversdale Anthracite Colliery

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World Coal,

ASX-listed Acacia Coal is to acquire Riversdale Anthracite Colliery (RAC) from Rio Tinto. According to a recent statement, the company will take a 74% stake in RAC with the rest to be held by a black economic empowerment (BEE) partner.

The initial purchase of RAC will be undertaken by Vryheid Anthracite Collieries (VAC), a subsidiary of Coalvent. Acacia Coal will then acquire Coalvent with Coalvent’s management team joining Acacia, including Hugh Callaghan, who will become Acacia’s managing director.

Acacia will also advance ZAR 2.48 million (AUS0.34 million) to Coalvent to fund the initial deposit for the RAC acquisition.

Drilling and feasibility studies at RAC have demonstrated a high-grade low-impurity anthracite asset that is well placed to supply the local South African anthracite market, which is facing significant supply shortfall of low-impurity product. There is also the potential to supply into the seaborne export market.

Following the acquisition, work will begin on updating the bankable feasibility study, which was completed in 2010, and the 2004 JORC resource.

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