South32
(ASX:S32) has announced it will manage South Africa Energy Coal as a stand-alone business from April 2018 with an investment of 4.3 billion South African rand, equivalent to US$301 million, extending the life of the Klipspruit coal mine by about 20 years.
The mining company will restructure South Africa Energy Coal and manage it separately in order to sustain ongoing production and other costs.
Development will commence in the current quarter with the first coal expected in FY2019.
The company also said it will seek to increase its local ownership of the coal company to be consistent with their commitment to South Africa’s economic transformation and may list the business on the Johannesburg Stock Exchange.
The colliery is expected to employ 740 people and create 4,000 jobs during construction and generate a 20 per cent return on investment.
Shares in South32
(ASX:S32) closed 2.63 per cent lower to $3.33.
