Operations

Our Minerals Strategy

Our minerals business builds from our position of strength to execute a robust strategy that is fully aligned to Exxaro’s core ambition. Exxaro Minerals plans to succeed along this journey and continue to create value for our shareholders by:

  • Leveraging our deep understanding of the market and fundamental drivers of the commodities we are targeting. This strength is based on our proven market to resource strategy that has seen us grow and diversify our markets over the years, along with an optimised thermal coal product mix.
  • Using our track record and experience in creating value to leverage hard-coded lessons that will guide this journey and ensure it is underpinned by a focused and rigorous set of criteria to ensure the selected commodities and targets are the right strategic fit for Exxaro.
  • Playing close to our core, from our roots, in order to increase our likelihood of success, and leveraging our strengths and competencies as a coal miner rather than diversifying away from them.
Our Minerals Strategy

Our Resources

Resources powering a clean world

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As one of the largest and foremost black-empowered resource companies in South Africa, we are continuously positioning our business for growth. At present, most of our operations are located in Mpumalanga, Limpopo and the surrounding areas – spanning ten sites. Exxaro has an asset portfolio, which includes coal operations and investments in iron ore, residual pigment manufacturing and renewable (wind) energy (Cennergi).

Our vision is simple: to produce resources that Power a Clean World. Our purpose is to Power Better Lives in Africa and beyond by responsibly investing in resources that will sustain life on the continent. This goal is being realised by fulfilling basic and primary needs, the things that keep us functioning as a society, through energy, water and food. We manage to do this all through our primary commodity – coal – which we are using to fuel our future. Through our growth and innovation, we are working towards becoming an unstoppable force of endless possibilities. We know none of this is possible without our people. Their imagination and passion are what constantly nourishes our journey to change the world for the better. We encourage collaboration, commitment and creativity in an environment that promotes safety, health and welfare – and where respect and equality are prerequisites. We know that our highly qualified workforce will become the industry leaders of tomorrow.

Coal

Coal

Coal Our core operation is thermal, semi-soft coking and metallurgical coal mining, supplying Eskom, other domestic markets and offshore markets. Our coal mining business (including Reductants) is structured under five legal entities, all managed and operated by Exxaro, supplemented by a joint venture for the Mafube operation and an equity interest in Richards Bay Coal Terminal Proprietary Limited (RBCT).

Iron Ore & Ferrous

Iron Ore & Ferrous

Exxaro owns 21% of Sishen Iron Ore Company (SIOC). They are a leading supplier of high-quality iron ore to the global steel industry and a subsidiary of Kumba Iron Ore Limited (KIO).

Exxaro FerroAlloys FeSi has superior qualities when it comes to physical properties such as sphericity, homogeneity, degradation resistance, specific gravity, corrosion resistance, and magnetism.

The production process guarantees that each FeSi particle is consistently small, solid, and dense to ensure superior performance as a dense medium compared to conventional atomisation methods using water or steam.

Zinc

Zinc

26% equity interest: Black Mountain Black Mountain operates two underground mines and a processing plant in the Northern Cape producing zinc and other minerals We continue evaluating our options to dispose of our shareholding in Black Mountain following the suspension of the sale in December 2020.

Renewable Energy

Renewable Energy

Our investments in renewable energy are a core pillar of our business resilience. We have been deliberate in building our capabilities in renewable energy through our investment in Cennergi, which we acquired full ownership of in April 2020. Scaling our renewable energy business allows us to build on our position as a key anchor of energy security in South Africa, a significant contributor to renewable energy solutions and decarbonisation. Our renewable energy business consists of 239MW of wind generation assets in the Eastern Cape that contribute to national power grid.

South Africa 1
Grootegeluk

Location: West of Lephalale
Market: Domestic and export
Product: Thermal and metallurgical coal
Mineral Resources (inclusive)
Measured: 2532Mt
Indicated: 1422Mt
Mineral Reserves (inclusive)
Proved: 1730Mt
Probable: 898Mt
Mining Method: Open-cut
RoM: 54Mt
LoM: 21+ years
2
Matla

Location: West of Kriel
Market: Domestic (Eskom)
Product: Thermal coal
Mineral Resources (inclusive)
Measured: 694Mt
Indicated: 123Mt
Mineral Reserves (inclusive)
Proved: 148Mt
Probable: 22Mt
Mining Method: Underground
RoM: 6Mt
LoM: 3+
3
Belfast

Location: South of Belfast
Market: Export
Product: Thermal coal
Mineral Resources (inclusive)
Measured: 72Mt
Indicated: 20Mt
Mineral Reserves (inclusive)
Proved: 40Mt
Probable: 2Mt
Mining Method: Open-cut
RoM: 3Mt
LoM: 11 years
4
Leeuwpan

Location: South-east of Delmas
Market: Domestic and exports
Product: Thermal coal
Mineral Resources (inclusive)
Measured: 80Mt
Indicated: 3Mt
Mineral Reserves (inclusive)
Proved: 42Mt
Probable: 6Mt
Mining Method: Open-cut
RoM: 6Mt
LoM: 8
5
Mafube (50% ownership)

Location: East of Middelburg
Market: Domestic and export
Product: Thermal coal
Mineral Resources (inclusive)
Measured: 111Mt
Indicated: 10Mt
Mineral Reserves (inclusive)
Proved: 32Mt
Probable: 23Mt
Mining Method: Open-cut
RoM: 5Mt
LoM: 11
6
Ferroalloys Ferrosilicon Plant

Location: Gauteng, 20 Roger Dyason Road, Pretoria West, 0001, South Africa.
Market: Domestic and export
Product: Ferroalloys
Mining Method: Proccessing Plant
7
Tsitsikamma Community Windfarm (TCWF)

Location: Near Tsitsikamma in the Eastern Cape
Market: Domestic
Product: Wind Energy
Mining Method:
8
Amakhala Emoyeni Windfarm (AE01)

Location: Near Bedford and Cookhouse in the Eastern Cape
Market: Domestic
Product: Wind Energy
Mining Method:
Mining Right Mine Windfarm Joint Venture

* Adequate reserves well beyond expiry of mining right.

Featured

R20 BILLION INVESTMENT

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We pledged R20 billion to South African President Hon. Cyril Ramaphosa at the 2019 South Africa Investment Conference, which was geared towards the development of our Coal Mining Operations in the Limpopo and Mpumalanga Provinces. Here is a summary of the Mega Projects which were constructed through this investment.

R20 BILLION INVESTMENT

Mega Projects

From initiatives dedicated to incorporating diverse stakeholder perspectives and strengthening our existing human resources to upgrading existing sites to be more modern and efficient, Exxaro’s Mega Projects are geared toward ensuring a more sustainable tomorrow. These investments have several objectives: to grow the coal business, to expand and increase production volumes more sustainably, and to lead the way towards greater sustainability and community development.

Grootegeluk Rapid Load-out Station

Grootegeluk Rapid Load-out Station

The Grootegeluk mine close to Lephalale, Limpopo Province, is a critical source of both A-grade export-quality coal and power station coal that fuels Eskom’s Medupi and Matimba power stations. The site has an estimated LOM (live of mine) of 45 years, producing 17 million tonnes annually. The R5.3 billion expansion of GG6 will ensure increased throughput and enhanced processing efficiencies to ramp up export coal production.

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Belfast Implementation Project

Belfast Implementation Project

A R3.3 billion investment was allocated to the development of a greenfield open-pit coal mine in September 2017.

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Leeuwpan Life Extension

Leeuwpan Life Extension

In line with Exxaro’s commitment to sustainability, the open-pit mine in Delmas, Mpumalanga province, underwent a project to extend its LOM time by a further ten years.

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Matla Mine 1 Relocation

Matla Mine 1 Relocation

To further our sustainability efforts, Exxaro invested R1.8 billion towards the development of infrastructure to support the life of mine (LOM) production. This included providing Mine 1 with access to a new box cut, bulk materials handling systems and associated infrastructure. Construction started in August 2020.

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Mafube Life Extension

Mafube Life Extension

Mafube coal is an existing 50/50 joint venture between Exxaro and Anglo American, the open cast mine, located east of Middleburg in the Mpumalanga province. It comprises a crushing and conveyance system from Nooitgedacht mining operations to the existing Springboklaagte ROM stockpile.

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Grootegeluk GG6 Project

Grootegeluk GG6 Project

The Grootegeluk mine close to Lephalale, Limpopo Province, is a critical source of both A-grade export-quality coal and power station coal that fuels Eskom’s Medupi and Matimba power stations. The site has an estimated LOM (live of mine) of 45 years, producing 17 million tonnes annually.

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Operations

Exxaro Energy

In line with our renewable energy strategy, we will begin the construction of the Grootegeluk solar PV facility in 2022. The 70MW facility will be developed with Cennergi and will provide clean, secure energy and significant cost savings, and reduce our carbon footprint.

Exxaro Energy
Renewable Energy

In April 2020, we acquired full ownership of Cennergi from Tata Power, giving us access to both the Amakhala Emoyeni Wind Farm (AE01) project with a capacity of 134 MW and the Tsitsikamma Community Development Wind Farm (TCWF) project with a capacity of 95 MW.

Cennergi was awarded preferred bidder status for these on-shore wind projects under the Department of Energy’s Renewable Energy Independent Power Producer Procurement Programme (REIPPPP).

TCWF is located approximately 30 km west of Humansdorp, falling within the Koukamma Local Municipality in the Eastern Cape, and comprises 31 Vestas wind turbines with a 95.325 MW capacity. Cennergi has a 75% stake in TCWF.

The AE wind farm is located between Cookhouse and Bedford in the Eastern Cape. The 134.4 MW wind farm comprises 56 Nordex turbines, each with a 91 m hub height and 2.4 MW capacity. Cennergi has a 95% stake in AE.

Both wind farms were successfully commissioned in 2016.

Wind Energy

Current wind farm projects include:

Tsitsikamma Community Wind Farm (TCWF) Location: Near Tsitsikamma in the Eastern Cape Capacity: 95 MW Number of turbines: 31 x 3 MW Performance: Achieved 101.5% of target over 5 years Customer: Eskom Power purchase agreement (PPA): 20 years Commercial operation: 2016 Shareholding: Cennergi (Pty) Ltd (75%), Watt RE Times (16%) and the Tsitsikamma Development Trust (9%)

Amakhala Emoyeni Wind Farm (AE01) Location: Near Bedford and Cookhouse in the Eastern Cape Capacity: 134 MW Number of turbines: 54 x 2.4 MW Performance: Achieved 99.4% of target over 5 years Customer: Eskom Power purchase agreement (PPA): 20 years Commercial operation: 2016 Shareholding: Cennergi (Pty) Ltd (95%), Cookhouse Community Trust (2.5%) and the Bedford Community Trust (2.5%)

Solar Energy

Lephalale Solar Project This sizeable, bespoke PV project enables cost savings and carbon reduction. The benefits include: • 36% reduction in Grootegeluk Scope 2 emissions when all power generated is used • >12% electricity cost savings per year from full production

Exxaro’s Community Development Projects.

Our socio-economic development initiatives are funded by the Exxaro Chairman's Fund (ECF), the Exxaro Foundation (EF) and the Exxaro People Development Initiative (EPDI).

Exxaro's integrated approach to infrastructure development, education, healthcare and ESD aims to advance and strengthen communities. We understand that our success is both short term, in terms of delivery of initiatives, and long term, as determined by the legacy we leave for our communities. Our guiding principles are sustainability, stakeholder inclusiveness and collaboration.

Exxaro’s Community Development Projects.

Operations

Mining Innovation

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Digital@Exxaro

The Digital@Exxaro programme was launched in 2019 to promote the Exxaro digitalisation and innovation journey and has shown that using digital, the company operates its mining assets on the lowest quartile through improved productivity, reduced costs and improved safety performance.