MC Mining updates on its Makhado hard coking coal project
MC Mining has provided an update on its fully licensed, shovel ready Makhado hard coking coal project (Makhado Project or the Makhado). The Bankable Feasibility Study (BFS) was completed in April 2022 by independent mining consultancy Minxcon (Pty) Ltd and was followed by two alternative development scenarios that significantly improved the baseline BFS economic outcomes, as announced by the Company on 30 August 2022 and were supplementary chapters to the BFS.
The alternative scenarios were assessed at pre-feasibility level and would require additional capital expenditure compared to the BFS base case scenario (Base Case). While the Base Case scenario was feasible and economically robust, the alternative scenarios resulted in improved project economics.
The Base Case comprised the mining of the West Pit, followed by the East and Central Pits, the crushing and screen of the ROM coal to Makhado and the transportation of the screened material 135km to the modified Vele Colliery plant for processing.
Scenario 2 included the initial mining of the East Pit, followed by the Central and West Pits, and the construction of a coal handling and processing plant (CHPP) at Makhado, rather than at the existing Vele facility, with an annual CHPP throughput capacity of two million tonnes per annum (Mtpa). Following this, the Company appointed Erudite (Pty) Ltd (Erudite) to complete the detailed study work for a full process plant design of the Makhado CHPP for Scenario 2.
Implementation Plan completed
The Company has also made notable progress towards the completion of a detailed implementation plan (Implementation Plan) for the first five years of mining and processing operations. The Company has limited technical execution capacity and with a strategy to limit fixed overhead costs, has secured this execution capacity by contracting an outsourced owner’s team and has also engaged key service providers to manage the Implementation Plan.
The Implementation Plan includes a detailed execution plan for the construction of the East Pit, Makhado CHPP, related infrastructure and a detailed mine plan for the first five years of operations.
The key inputs of the Makhado Project were independently peer reviewed, and the Implementation Plan has been value-engineered improving the accuracy of the studies from the pre-feasibility study’s ±30% accuracy to an estimated accuracy of ±10%.
