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ZAC poised to grow domestic and global anthracite market share

Published by , Editorial Assistant
World Coal,

Zululand Anthracite Colliery (ZAC), South Africa’s sole producer of anthracite, is confident about the medium to long-term growth of demand for the product as it prepares to expand the life mine beyond the remaining 12 years.

“We are confident about the future of the market both locally and internationally for ZAC’s products,” Bradley Hammond, investment company Menar chief operating officer, told a Southern Africa Coaltrans conference in Johannesburg on 19 September.

“We are a ‘One Stop Shop’ for anthracite that has all the facilities to size and blend our products according to market needs, and we have sufficient capacity and access to rail for export and transport to local and international consumers. We are the preferred supplier to key industrial clients in the South African market and we plan to become a bigger player in the anthracite market worldwide,” Hammond said.

“Our strategy of ensuring high tonnages, low cost and high-quality product is one of the main reasons why there is growing interest in our products from countries such as Vietnam, Brazil, USA and Spain. We are therefore aggressively pushing to increase our marketing efforts to expand our global supply footprint,” Hammond added.

Located in the district of Ulundi, in northern Kwazulu-Natal, ZAC has 12 million t of reserves remaining, five underground sections and produces 1 million tpy of anthracite. It has processing plants onsite, which have a combined processing capacity of 2.2 million tpy. The product is washed to top qualities of 0.9% - 1.4% sulfur with extremely low ash content ranging from 8.5% - 18%.

The high-quality products are sized to customer specifications. It is a critical component in electrode paste, calcium carbide and ferrochrome production, among other applications. About 80% of the company’s product is sold in South Africa as a cheaper option to manufacturers compared to higher cost Russian anthracite or coke from China.

From uncertainty to aiding economic and social stability in Zululand

Hammond recounted about how since Menar, ZAC’s main shareholder, acquired the operations in September 2016, it had overcome immense challenges and transformed it into a sustainable mining operation that contributes to the wellbeing of its host communities.

Until Menar acquired ZAC in 2016, the mine was at different stages owned by BHP Billiton (from 1985), Riversdale Mining (from 2005) and Rio Tinto (from 2011). Founded by Vuslat Bayoglu, its Managing Director, Menar turned the operation around and it is now on the verge of declaring a maiden dividend that will also benefit the workers and community who hold a combined 26% stake.

The mine employs 1350 people and participates in President Cyril Ramaphosa’s job creation flagship project, the Youth Employment Service. “ZAC is not just a mine, it is virtual a city with community and workers forming an integral part of our family like structure,” Hammond stressed.

“We continue to invest in the mine to improve capacity and efficiencies and aim to expand our capacity in years to come,” Hammond remarked. Plans for expansion of ZAC’s operations to increase life of mine include bringing on stream new projects such as Riversdale Anthracite Colliery (RAC) and the Mfolozi Project, which would be a combination of opencast and underground mine. Both projects are located in Northern KwaZulu-Natal.

The continued operation is crucial for the economic development of the community. In addition to providing jobs and contracting opportunities for community-based entrepreneurs, ZAC invests heavily in community upliftment projects. “We supply 42 million litres of clean, potable water to communities through 20 km of water pipes which we built. ZAC also runs education programmes, agricultural programmes, operator training initiatives and youth skills training programmes,” Hammond highlighted.

Hammond quoted Zulu King Goodwill Zwelithini, who said during a visit to the mine: “ZAC is a very important business in Zululand and it must be protected and supported by the community and workers.”

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