The International Resource Journal: Lontoh Coal

Lontoh Coal
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admin on 26 July, 2010 03:29:00
 
“It’s a very exciting project we have embarked upon,” says
Lontoh Coal CEO Tshepo Kgadima.
With characteristic discernment, Kgadima describes the company’s Lubimbi
coal project. The fact is, the positive exploration results just revealed show
Lubimbi’s block five target area has exceeded the expectations of
Lontoh’s geotechnical team and “exciting” scratches the
surface of what lies ahead for the Zimbabwean coal project.
The Lubimbi coal project is essentially a coal and gas project. Lubimbi is
situated on the fringes of the Gwai settlement, near Hwange, an area which hosts
two-thirds of Zimbabwe’s known coal deposits. Currently being explored,
results are showing an increase in ratio of coking coal in the larger seam,
which is at a shallow 15-20 metres.
“In that area, we are seeing coking coal going above 20 per cent in ratio
to thermal coal,” says Kgadima.
Lontoh Coal is planning an ambitious three-level application for the coal and is
currently evaluating plans to develop a coal-to-liquid plant and a power plant.
“We have completed a scoping study done by engineers that is informed by
historical drilling. The test work that was done has shown we are currently
averaging 77.6 per cent of fixed carbon in the coal. This gives us good
indication that a coal to liquid plant will be viable,” he continues.
Great demand
Kgadima and his team have struck coal at the opportune time and are anxious to
supply the ever-growing development of the region.
“We are taking into account the regions liquid fuels need is increasing as
the economy grows. Inland countries are very much reliant on fuel imports, so
from that point of view, we need to do this in order to serve our region and see
it progress. The study we have done indicated the overall demand for coking coal
in the region is over three million tonnes a year. This presents a great
opportunity for us.”
And an opportunity for which Lontoh Coal is amply prepared. From the exploration
and drill work done comes results of a proven reserve in block five of about 400
million tonnes. The remaining extent will hold 800 to 900 million tonnes of open
constable resources, with inferred resources on the underground section adding
up to six billion tonnes of coal.
Production
The key focus for Lontoh Coal now is to get it into production and produce and
supply coking coal to regional users. The team is currently evaluating plans to
build four coking coal batteries, either in-house or possibly with a joint
venture. This will then feed the demand for coking coal which is used as a
reductant particularly in the steel, alloy, ferrochrome and copper industry.
“We’ve reached a stage where we know for sure that we can mine, and
our priority is to begin by producing coking coal,” says Kgadima.
The objective to become a coking coal miner is based on high demand. Operating
margins are the healthiest they have been in a long time. Right now we are
progressing with our plans to develop various other applications like the coal
plant and coal to liquid.
With drilling complete by the end of July, Lontoh Coal will be securing its
mining lease by October of this year which in turn will enable the company to
break ground by January of 2011.
“Because of the open constable nature of the deposit,” says Kgadima,
“we are looking at being able to quickly get into production. Once we
produce by February, we will immediately be able to process, ship and deliver
that coking coal to various users in the region including possible exports
through Mozambique ports.
“In 2011, we will be looking at starting at two million tonnes per annum
and then ramp up in three years to 10 million tonnes per annum,” says
Kgadima.
Of course the team is excited about its prospect. With the scale, long life and
applications of the project, the future is increasingly bright for the Lubimbi
coal project.