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First coal mining for Universal Coal

World Coal,

Universal Coal is one step closer to becoming a coal producer following mining of the first Run of Mine (ROM) coal at the Kangala coal mine in the Witbank coalfield, South Africa.

With the BC1/BC2 circuit of the processing plant having arrived and assembly well under way, Kangala remains on schedule to deliver first production in February 2014.

The Kangala mine will be the company’s first coal operation, producing 2.1 million tpa of thermal coal, with 2 million tpa allocated for South Africa’s leading electricity utility, Eskom, and 100 000 tpa of high quality thermal coal allocated for export with leading South African coal miner Exxaro.

The majority of the coal allocated to Eskom will pass through the completed BC1/BC2 crushing and screening plant, due to commence commissioning in December 2013. The first raw coal has been delivered to the processing plant, for use as a base for product stockpiles. The pollution control dam is progressing on schedule and will be ready to accept water towards the middle of November this year.

The paved product delivery haul road is on schedule while the portal culverts for the river crossing have been installed ahead of the summer rains. Recruitment of mining personnel is almost complete, with almost 100% of the permanent mining staff vacancies currently filled. Recruitment of the processing plant personnel is progressing with off-site training of the new recruits underway.

Drawdown on the Kangala Mine Project Finance Facility provided by Rand Merchant Bank continues in line with forecasted drawdown estimates. The project remains within capital budget estimates and there are currently no indications of any potential cost over-runs.

Universal Coal is delivering to date on all project metrics and timelines, and is set to benefit from any uplift in coal prices.

The company has five coal projects in South Africa with 1.9 billion t of JORC resources covering thermal and coking coal.

Adapted from press release by Katie Woodward

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