Giving an update on the market, Minergy CEO Morné du Plessis said their objective is to secure additional long-term export seaborne offtake agreements since the logistics and coal qualities have been established. “At the same time, we assess funding options, including enquiries to place approved equity, to reduce debt and consider expansion opportunities,” he said.
For the six months, Minergy sales averaged close to 68,000 tonnes per month which includes the downtime following the general December shutdown period. According to the CEO, volumes are roughly 53% higher, while pricing has been exceptional and approximately 66% higher than the comparative six-month period. “During these six months, roughly the same volume of coal was sold during the entire 2021 financial year and sales have already reached 70% of the full 2022 financial year volumes,” he said. Minergy’s preferred evacuation route for seaborne exports is through the Walvis Bay Port where they export about one-third of their coal.
During the six months, Minergy successfully delivered coal to three vessels while deliveries are in transit for a fourth vessel by the close of the six months. The vessels are all bound for Europe. Since March 2022, this amounts to the successful loading and dispatching of six vessels ranging from 30,000 to 55,000 tonnes capacity.
“Other routes are continuously being investigated; overall average pricing has increased, buoyed by lucrative export pricing. Pleasingly, coal qualities have been consistently achieved to the extent that deliveries have resulted in quality bonuses,” he said. However, he said the availability of logistics has become a key challenge for Minergy and its customers as commodity suppliers and customers increasingly rely on trucking products to ports and end users, creating a scramble for trucks in the absence of rail.
Due to Minergy being an early entrant, du Plessis said they have managed but it remains challenging in the wake of further disappointing Transnet performances.
