(Alliance News) - Exxaro Resources Ltd said on Thursday it was of the view that challenges the state-run logistics firm Transnet SOC Ltd faced did not constitute force majeure.
This come after Transnet informed coal miners that it had terminated long-term coal transportation agreements to ferry coal from Mpumalanga to the privately held port Richards Bay Coal Terminal.
Logistics parastatal Transnet points to ongoing legal matters related to the irregular locomotive acquisition, maintenance contracts and the vandalism of the coal line as reasons for force majeure.
Transnet said these challenges, which are beyond its control, will continue to hobble its ability to perform its rail service for at least the next six months and that accordingly it is operating under force majeure.
Exxaro confirmed that Transnet was engaged with coal miners over a new agreement.
Transnet intends to finalise new five-year agreements with miners by June 30.
The group indicated that during this period it will continue to render transport services to exporters like Exxaro in terms of its standard conditions of carriage.
Exxaro cautioned that the potential impact on its operations cannot be determined until the finalisation of the negotiations, which may result in amendments to the agreements.
Earlier in the day, Thungela Resources Ltd said coal exporters were engaging actively with Transnet to clarify the contractual position and ensure the stability of coal deliveries to the RBCT in order to continue to take advantage of the current strong market demand for South African coal.
Exxaro's stock was up 0.3% at ZAR234.52 on Thursday afternoon in Johannesburg.
Shares in Thungela shaved off 7.2% to 1,270.00 pence each in London on Thursday afternoon, and were down 7.4% to ZAR240.58 each in Johannesburg.
By Artwell Dlamini; artwelldlamini@alliancenews.com
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Thungela Resources (TGA)