Cooperation with CoAL to Promote Overseas Strategies

From: 2015-10-14

On November 27, 2015, Coal of Africa Limited (CoAL) and Hengshun Zhongsheng signed MOU with Regard to Qingdao Hengshun Zhongsheng Group Co., Ltd. Purchasing Part Stakes in Baobab Mining & Exploration (Pty) Ltd. Hengshun will pay 113.9 million dollars for purchasing 34% stakes in coal project Makhado under CoAL.

Coal of Africa Limited (CoAL)

Founded in 1979 and registered in Perth, Australia, Coal of Africa Limited was listed in capital markets of Australia, London and Johannesburg. The company is mainly engaged in coal exploration and production, and its main products are coking and thermal coal. The first major shareholder is Haohua Energy Resource International (Hong Kong) Co., Ltd., a wholly owned subsidiary of Beijing Haohua Energy Resource Co., Ltd.

The largest producer of coking coal in South Africa

CoAL now has a coal-producing mine in South Africa and is entitled with 9 exploration rights. The main coal species include coking coal and thermal coal. The total amount of coal resources has reached 8.32 billion tons, and the recoverable amount is 2.33 billion tons. The total resources amount of the coal-producing mine is 370 million tons, the recoverable amount 330 million tons. The area that the 9 exploration rights involve is 1000 square kilometers, and the estimated total resources is 7.956 billion tons, the recoverable amount 2.004 tons.

South Africa is a large importer of cocking coal. CoAL has held 80% of the  coking coal reservation in South Africa and has shifted their focus to exploration and production of coking coal, laying a foundation for it to become the largest producer of coking coal in South Africa.

Powers alliance, realizing mutual assistance

Hengshun sighed MOU with CoAL and they established partnership, which can make the two sides harness respective strengths and achieve powers alliance, mutual assistance, mutual benefit and win-win.

As a listed enterprise, Hengshun Zhongsheng has years of experience in equipment manufacturing, overseas investment and mining operation. They can bring abundant capital, advanced technology and management experience into CoAL by participating in Makhado project.

The advantages of rich resources and operational experience in coal market of South Africa help CoAL achieve localization management and avoid risks in politics, law, labor in investment. The reservation of coal resources is a business expansion of CoAL, laying a foundation to further extend their core industrial chain and achieve international development.