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(Alliance News) - MC Mining Ltd on Monday said its second-quarter coal production declined marginally due to constraints at its Uitkomst Colliery.
The coal miner also said it remained confident that a diligence review by a "a number of parties", mulling providing the balance of funding to develop Makhado hard coking coal asset, can be finalised during first half of the calendar year.
It said it was exploring several alternative strategies to raise additional funding, including but not limited to, the issue of new equity for cash in MC Mining or subsidiary companies, or further debt funding.
For the second quarter ended December 31, MC Mining said run-of-mine coal production at Uitkomst was marginally lower, falling 2% to 107,188 tonnes from 108,945 tonnes as a result of the suspension of mining for three shifts following production constraints at Uitkomst's explosives supplier.
Revenue per tonne soared 68% to USD111 per tonne in the second quarter from USD66 a tonne due to the much higher export coal prices recorded during the quarter.
Limited activities were undertaken at the company's Makhado hard coking coal project, Vele semi-soft coking and thermal coal colliery, and Greater Soutpansberg Projects during the quarter.
Subsequent to the end of the quarter, the Industrial Development Corp of South Africa Ltd extended the repayment date for the ZAR160 million, or USD10.3 million, loan plus accrued interest from January 31 to November 30.
The terminal drawdown date of the additional ZAR245 million IDC term loan for the development of phase 1 of Makhado was also extended from January 31 to November 30, with the drawdown remaining subject to the IDC re-affirming its due diligence.
At the end of the second quarter, available cash and facilities stood at USD3.2 million from USD3.5 million at the end of September 30.
MC Mining said the demand for coal continued during the quarter, leading to a rise in the price of quality South African export thermal coal with average prices improving to USD163 per tonne, compared to USD73 a tonne in the second quarter in prior year. In the first quarter prices stood at USD139 per tonne.
Shares in the company were 6.0% lower at 4.46 pence each in London on Monday morning. The stock was flat at ZAR1.15 each in Johannesburg.
By Artwell Dlamini; artwelldlamini@alliancenews.com
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