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ResGen appoints CHPP EPC contractor

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World Coal,

Resource Generation (ResGen) has concluded an agreement with Sedgeman for the design, procurement and construction of a coal handling and preparation plant (CHPP) at its Boikarabelo coal mine in South Africa’s Waterberg region.

The US$141 million contract represents a substantial saving on previously announced estimates, according to ResGen, as the Sedgeman design offers a smaller footprint with associated capital savings, while maintaining production output.

The provisions of the agreement as includes as intent to negotiate a three-year CHPP operations contract with Sedgeman. This would follow the expiry of a 15 month operations contract to cover the post-commissioning warranty period.

Sedgeman is part of Spanish-owned CIMIC Group and is a leading EPC contractor in the coal and minerals industries. The ASX-listed company has a record of delivering coal projects in southern Africa with over thirty major coal projects delivered over the past decade.

“The conclusion of the EPC contract with a leading contractor basd on the significantly reduced capital cost of the project is a major milestone for the Boikarabelo mine and ResGen and is a step closer to securing full funding for its completion,” said Rob Lowe, ResGen’s CEO.

ResGen is an ASX and JSE-listed coal producer. Its Boikarabelo project has reported reserves of 744.8 million t of coal. Stage 1 on mine development targets saleable coal production of 6 million tpy.

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