Holfontein
| Interest | 100% |
| Location | East of Johannesburg Witbank Coal Field |
| Area | 1160.8 hectares |
| Resource | 55 million (inferred) |
Overview
Holfontein is located near the middle of Sasol’s (and more recently Anglo Coal’s) Secunda coal production area. It has remained undeveloped partly due to interpreted geological complexity and partly because of fragmented ownership.
Two coal seams at Holfontein are commercial targets: 4 Seam; and the shallower 5 Seam. The low vitrinite, high ash coal of 4 Seam currently mined in the district, is sold untreated to Eskom for its coal fired power stations or is used by Sasol in its synthetic fuels plants at Secunda. Eskom’s Tutuka power station, 50km by road/rail from Holfontein, is a significant buyer of spot market coal, and is a likely buyer of Holfontein 4 Seam coal. Sasol has also indicated willingness to purchase 4 Seam coal for its Secunda treatment plant 6km south of Holfontein. 5 Seam contains high value coal in narrower seam widths and is typically found in two horizons of bright coal, 60cm and 30cm thick. As part of the bankable feasibility it is planned to test the feasibility of mining the two horizons together with the parting and washing the run of mine ore at surface level. The most likely markets for 5 Seam coal are: as an export steam coal through RBCT, the low phosphors metallurgical coal market; and/or the domestic coking coal market.
GVM acquired Motjoli Resouces’ 51% stake in the Holfontein coal project through the issue of 14,868,283 GVM shares and paid R21 million (A$3.5 million) for the initial 49% acquisition.
Future
Composite samples of the 5 Seam are to be reconstituted to test for certain metallurgical properties, while similarly the 4 Seam samples are to be reconstituted and tested for suitability for consumption by Eskom.
The Company plan to produce 400,000tpa of soft coking coal from the 5 seam and 800,000tpa of thermal coal from the 4 seam.
Although not finalised CoAL has reached an agreement with Lachlan Star Limited ("Lachlan Star") whereby Lachlan Star will acquire 100% of the Holfontein Coal project in South Africa.