JOHANNESBURG: Ngoako Ramatlhodi, the mining minister, has said that the South African coal industry needs to invest at least 100 billion Rand ($8.7 billion) to build up mines and infrastructure after billions were lost to the industry due to falling prices.
Ramatlhodi said we are concerned about the extreme volatility in the coal price, which has a direct effect on the profitability of companies, as well as implications for employment. To this effect, the latest decline in coal prices has resulted in a R23 billion revenue loss in exports.
Glencore-owned Optimum Coal, one of the biggest coal producers in South Africa, warned it could cut back production by 5 million medium terms because of falling prices.
Further Ramatlhodi said recently concluded coal reserves study affirms that South Africa still has sheer volumes in excess of 66 billion tones that can be economically extractable, for well over a century.
He added we are informed by our stakeholders that in the short to medium term, the development of these resources will require an investment of a minimum of R100 billion, in extraction as well as attendant multipurpose logistics and infrastructure.
