MC Mining's Makhado Project shows strong progress as share price rises 15%

MC Mining’s share price shot up over 15% on Friday afternoon after it reported that the development of its Makhado Project is progressing strongly, with coal plant commissioning activities expected to start in December 2025.

The company stated in its first quarter activities report for the period ending September 30 that project expenditure remains within budgeted estimates, despite delays encountered due to inclement weather, sourcing suitable construction materials, and obtaining clearances to construct a 14km long power transmission line.

The share price of the coal mining and mine development company was trading 15.79% higher at R2.20 on the JSE on Friday afternoon, a price also well up from R1.65 a year ago. The colliery will be South Africa's largest hard coking coal (HCC) producer, designed to produce 800 000 tons a year once steady-state operation for the foundation phase is reached.

The company said the principal mining contractor had started open pit mining of the box cut; civil foundational works for the coal plant were largely complete; and significant progress was being made towards the commissioning of the overhead power transmission line.

Meanwhile, an operational improvement plan for Uitkomst Colliery was approved, and initiatives were being executed. Overhead cost reductions are being realised. Focus has moved to increasing production, and improved production is expected in the last quarter of the calendar year.

Run-of-mine (ROM) coal production from Uitkomst Colliery fell by 21% than the previous quarter and was 8% lower than the same period a year before, at 82 588 tons. The lower production was due to delays in the start of the turnaround plan, temporary operational challenges, and reduced machine availability due to repairs and refurbishment that are part of the turnaround plan.

Uitkomst Colliery sold 47 116t of high-grade coal during the quarter, a 1% decrease on the prior year sales, and there were no sales of the lower-grade middlings coal. Coal plant yields remained high at 73% due to operational improvement initiatives, which offset the lower ROM coal production.

Limited activities were undertaken at the Vele Aluwani semi-soft coking coal (SSCC) and thermal coal (TC) Colliery, whilst the numerous coal deposits within the Greater Soutpansberg Projects (GSP) were evaluated and prioritised for development.

Available cash and facilities stood at $13.2 million at the period end, versus $7.4m at the end of the fourth quarter. Christine He was permanently appointed as MD and CEO.

Contiguous to the Makhado Project are the satellite Greater Soutpansberg Projects (GSP), which are at granted Mining Right status and are also endowed with steelmaking HCC potential, scheduled to be the focus of mine planning once the Makhado Project is commissioned.

As of the reporting date, the Department of Mineral and Petroleum Resources (DMPR) undertook a comprehensive onsite health and safety, environmental, social, and labour planning and regulatory compliance audit of the Makhado Project. The Pollution Prevention Plan and the Greenhouse Gases Emission report were approved by the Department of Forestry, Fisheries, and the Environment, further improving the environmental credentials of the Makhado Project.

Uitkomst Colliery, as of the end of the quarter, had started implementing the turnaround plan with the assistance of Metalla Tutum Engineering, a South African specialist mining engineering and consulting firm.

Visit:www.businessreport.co.za