Silver lining in tough mining sector

Growth-focused Canyon Coal sees silver lining in tough mining sector

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Despite clouds of policy uncertainty and a struggling South African economy hovering over the mining industry, Canyon Coal, a proudly South African junior mining company, is buoyant about the future.

The company’s management has adopted a long-term view of the sector’s prospects beyond current uncertainty and challenging economic conditions. Canyon’s Executive Chairman Vuslat Bayoglu believes in focusing on the silver lining to drive an organic and realistic growth strategy. 

The company’s strategy is characterised by developing new projects, improving efficiency and output in existing operations, managing risks, exploring new markets, deepening stakeholder relations including those with local communities where the company operates and adopting strict compliancy with regulations. This strategy will see Canyon graduate to a mid-tear-level company by 2020 as it ramps up production from 3. 6 million tonnes of coal per annum to 10 million tonnes per annum.

Canyon owns and operates three collieries in the Mpumalanga region, Hakhano, Singani (Middelburg) and Phalanndwa (Delmas). Plans are afoot for expansion in the area adjacent to Hakhano to continue to use the infrastructure after the existing deposits have been exhausted. The open-cast operations produce bituminous coal for domestic and export markets. Soon to be added to this portfolio of collieries are Khanye (Bronkhorstspruit) and Ukufisa (Springs).

Plans are already at an advanced stage to bring Ukufisa and Khanye into operation by the end of 2017. Ukufisa, has coal reserves of 170 million tonnes and promises to be a mega-mine.

Regulatory authorities have issued Canyon Coal with a water-use license and mining rights for Ukufisa where operations will produce export-grade coal in the RB3 category range. Although Canyon has not yet secured a supply agreement with Eskom, this quality of coal and the mine’s proximity to the utility’s power stations makes it ideal and cost-effective for power generation.

Canyon acquired De Wittekrans in 2016, which has a coal reserve of 118 million tonnes. Project has a mining right and a water-user license granted. Mining is planned to commence during the first half of 2018.

Canyon also owns Springfield project in Gauteng and is expected to commence open cast operations in 2019, producing approximately six million tonnes of ROM coal per annum for the next 50 years.

In addition, Canyon also owns two processing plants whose current production capacity can be expanded.  One of the plants is located at Hakhano and processes coal produced from this operation as well as coal hauled in from Singani. The other plant is in Phalanndwa.

Driving Canyon’s growth strategy alongside Bayoglu is Hakhano and Singani’ s General Manager Guy Thompson, Canyon’s Group Plant Manager Jacques Diener and Phalanndwa’ s General Manager Alan Mabbett. Their combined vast experience ensures that they are adept at managing risks inherent in any mining operation.

Conscious of the needs of local communities, Canyon prioritises local community applications for job opportunities at its various operations and is actively involved in community development initiatives. The company assisted in building the Bonginhlanhla Simulation Centre for disabled children, near Hakhano and Singani collieries, which cares for 35 children suffering with physical and learning disabilities. The company also provides bursaries to talented young people from poor households in their operating regions.

After a child and an adult drowned while crossing an overflowing river in Delmas, Canyon helped to build Given Diko footbridge to assist learners and other pedestrians to cross safely.  The bridge has been named after the child who drowned. 

Adherence to environmental legislation, safety standards and healthy labour and community relations, are the pillars of sustainable mining.  It’s about creating a positive legacy, and being a good South African corporate citizen,” concludes Bayoglu.

Vuslat Bayoglu will be discussing where future mining opportunities may come from at this week’s Joburg Indaba taking place on 5-6 October at the Inanda Club, Johannesburg.

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Issue 42