MEDIA RELEASE

Optimum Coal, a leading black-owned and controlled JSE listed mining and exploration company, is delighted to announce the launch of its new water reclamation plant. Minister Bulyelwa Sonjica, South African Minister of Water and Environmental Affairs delivered the key address at the launch event. The plant will add significant value to the water quality and availability in Mpumalanga and can treat 15-million litres of water per day to a point of safe human consumption.

The plant is situated at Optimum Collieries, south-east of Middelburg in Mpumalanga. Costing a total of R600m, the plant with an average flow of 15Mℓ/day will assist Optimum Collieries with the sustainable management of its surplus affected water needs for the next 22 years and after mine closure. Operating costs for treating water will be incurred by the mine and it is likely that revenue will be generated from the sale of potable water to the Steve Tshwete Local Municipality. After closure, the operational costs of the plant will be funded from Optimum Collieries’ Environmental Trust provisions and from revenue generated from the selling of potable water.

“The launch of the Optimum Coal Water Reclamation Plant is a fine example of South African business realising its responsibility to use water and then stepping up to provide water solutions in a sustainable manner. I applaud Optimum Coal for their significant investment in this world-class project to build a significant resource asset. The Optimum Coal Water Reclamation Plant will bring significant benefit to meeting the water needs of the region and will make a real difference to the communities surrounding the Optimum Collieries,” states Minister Bulyelwa Sonjica, in her key address.

Mike Teke, the CEO of Optimum Coal says, “The capital required to construct the facility was generated by Optimum Coal Holdings, while the operating costs of the facility, during the life of mine, will be funded as part of the mine’s operational costs. Revenue generated by the selling of the water to the Steve Tshwete Municipality will offset some of these operating costs. In future, after the life of mine period, the operational costs of the plant will be funded from revenue generated from the selling of water, as well as from provisions to be made in the mine’s Environmental Trust Fund.”

This plant is a prime example of international best practice in its field. This is only the second such plant in South Africa and is leading the way internationally with respect to mine water treatment. It ensures that Optimum Collieries’ long-term water management strategy during and after the life of mine period will be managed in a sustainable manner. The plant will also enable Optimum to become a zero effluent mine in line with the Optimum Coal Zero Harm policy.

The water treatment plant forms a critical part of the company’s long-term water management strategy that is based on minimising the production of impacted water by responsible mining and land use practices. In addition to this, the mine optimises the reuse of the affected mine water within its mining process to limit its use of raw (clean) and potable water.

The plant uses The Aveng Group’s proven HiPRO (High Recovery Precipitating Reverse Osmosis) process to treat the water and turn it into potable water of a standard equivalent to leading brands of bottled drinking water. “We are pleased to have partnered with Optimum Coal in this state-of-the-art water treatment plant, which not only will service the colliery but also the neighbouring community,” says Roger Jardine, CEO of The Aveng Group, JSE-listed infrastructure development group.  Aveng’s specialist water treatment subsidiary Keyplan provided the technology and designed and built the plant and another Aveng subsidiary, E+PC Operations will operate the plant for the next three years.  

The mine contracted two main service providers to construct the plant, however, a multitude of sub-contractors were appointed by them to assist with the construction of the various components, in total about 18 contractor companies worked and are working on the project.

The construction work which was project-managed by Optimum Coal’s Environmental Team, led by Dr Vik Cogho commenced in October 2008 and is estimated to be fully completed by July 2010; making it roughly 20 months of construction. “At the peak of the construction activities there were 610 people working on the project and currently there are about 370 people on site. Golder Africa in conjunction with dedicated mine employees were responsible for the successful implementation of the project,” said Dr Cogho.

This project and all the other rehabilitation and water management projects that are currently being implemented by the mine are a clear demonstration of the mine’s commitment towards this value,” concludes Cogho.

About 95% of the treated water will be available for the surrounding communities, while the remaining 5% will be given back to the environment by discharging it into the [Klein Olifants river] to sustain the aquatic reserve, as required by Department of Water Affairs.

EDITORS NOTES:

OPTIMUM COAL

• Formed in 2007, Optimum Coal is the sixth largest producer and the fourth largest exporter of low sulphur content thermal coal in South Africa. The company’s operations are located mainly in the Mpumalanga province and include Optimum Collieries and Koornfontein Mines in which it currently has a 96% interest.
• The company’s operations include Optimum Collieries and Koornfontein Mines. Optimum Collieries is a large opencast and underground mining complex comprised of four coal production areas with a reserve base in excess of 270-million tons of run-of-mine coal, of which 191-million tons are classified as saleable coal. Koornfontein Mines is a significant underground mining operation with a reserve base of 48.3 million tons of run-of-mine coal, of which 30.7 million tons were classified as saleable.
• The estimated life of the mines of Optimum Collieries is 22 years and Koornfontein 18 years respectively.
• Optimum Coal is committed to transformation to greater gender and race equality in our industry. Optimum Coal manages its stable workforce without compromise to leadership. Optimum Coal sets a sterling example of real broad-based black economic empowerment. Not only is Optimum Coal majority black owned, but is a highly successful South African coal mining company with operational control also being in black hands. We have a clear transformation strategy with specific efforts to integrate transformation as part of the way we do business. Optimum Coal recognizes the role of all its stakeholders on this journey and regular communication informs all our stakeholders (internal and external) of milestones achieved in our transformation efforts.
• In the year ended 30 June 2009 Optimum Coal generated revenues of R3, 964.7 million, and an EBITDA of R1, 439.9 million.
• Optimum Coal’s export sales are made into the Asian and European markets pursuant to long-term supply agreements with BHP Billiton Energy Coal South Africa (BECSA) and Mercuria Energy Group. Export sales are shipped through the Richard’s Bay Coal Terminal (RBCT), in which Optimum has an 11% interest and is the largest BEE owner.
• Optimum Coal supplies coal to, amongst others, Eskom’s Hendrina Power Station, which is an integral part of the South African coal fired electricity power grid.
• Optimum Coal has strong pipeline of development projects at various stages of implementation. Additionally, exploration work continues on various ‘Greenfield’ projects to improve resource confidence with a view to prioritising Optimum Coal’s growth and development pipeline.

THE AVENG GROUP AND THE HiPRO PROCESS

• The Aveng Group has six subsidiaries, namely McConnell Dowell Corporation Ltd, Grinaker-LTA, Engineering & Projects Company (E+PC), Moolmans, Aveng Manufacturing and Trident Steel. The Aveng Group reported revenues of R33, 8 billion and headline earnings of R2,1 billion in 2009. E+PC and Keyplan are part of The Aveng Group’s Engineering, Construction and Mining Contracting cluster. Keyplan, forming part of E&PC, is a specialist water treatment company. The Aveng Group, through Keyplan, has developed a high recovery precipitation reverse osmosis (HiPRO) process that significantly outperforms any comparable technology for the treatment of Acid Mine Drainage (AMD).
• The HiPRO process was developed by Keyplan in 2005. The process is a world first with a more than 97% recovery rate that produces high quality potable water from mine water that has high acidity and high sulphate levels. This is in contrast to most membrane plants, which are designed for a recovery of between 70% to 85%.
• The HiPRO process is able to achieve its high water recovery as the process utilises multiple stages of ultrafiltration (UF) and reverse osmosis (RO) membrane systems, operating in series, and with inter-stage precipitation of low solubility salts. This ensures that only 3% of the raw feed water remains for disposal to a lined evaporation dam. In other processes, where higher recoveries are necessary, very expensive evaporators and crystallisers are used as the current alternative state of the art technology for the final concentration step.

FURTHER MEDIA INFORMATION, ENQUIRIES OR INTERVIEW REQUESTS:

• Please find attached the factsheet op the Optimum Colliery Water Treatment Plant
• Issued by Stone on behalf and with approval of Optimum Coal
• Please direct all media enquiries or interview requests to Willem Eksteen, Themba Mwelase or Perusha Singh at Stone on 011 447 0168 or alternatively on This e-mail address is being protected from spambots. You need JavaScript enabled to view it   / 083 272 6304 or This e-mail address is being protected from spambots. You need JavaScript enabled to view it / 082 256 1753 or This e-mail address is being protected from spambots. You need JavaScript enabled to view it /  073 940 6222