Continental Coal Ltd has announced that it has exceeded its monthly production target of 100,000 t of thermal coal at its Vlakvarkfontein coal mine in South Africa, just two months after production commenced at the company’s first mine.
The Australian-listed company said it produced 101,899 t of thermal coal at the mine, based 100 km east of Johannesburg, during July.
Continental Coal CEO, Don Turvey, said: “We are confident that sustained monthly coal production levels of 100,000 t can be achieved in the December 2010 quarter and beyond.”
Off-take agreements
The company also announced that, since first coal production commenced in May 2010, it has successfully concluded three separate off-take contracts for the sale of its domestic quality thermal coal from the mine.
These contracts, which are with domestic end users and nearby mining operations, are generally short-term, extending for periods of no more than 6 months.
However, the company expects longer-term contracts to be signed in the coming months, as mining activities at Vlakvarkfontein are now taking place on both the 4 seam and 2 seam.
Turvey said: “With these preliminary off-take contracts already established, the company is well positioned to ensure 100% of our forecast production at Vlakvarkfontein is sold into the domestic market at attractive coal prices which provide free cashflow to support our other mine development activities.”