South Africa's Exxaro bullish on coal, eyes higher Japan exports
By Olivia Kumwenda-Mtambo and Wendell Roelf
CAPE TOWN, Feb 7 (Reuters) -South Africa's Exxaro Resources EXXJ.J is bullish on coal and is targeting larger exports to Japan of its higher-grade RB1 coal, it's CEO said Wednesday, even as it looks for copper and manganese assets on the continent to diversify its operations.
RB1 coal, prized for its low sulphur content and high calorific content, is widely considered the best quality coal in South Africa and is mainly destined for export markets.
"We are very bullish about our coal business," chief executive Nombasa Tsengwa told Reuters on the sidelines of an African mining conference in Cape Town.
"The Japanese are choosing to burn better quality coal, which is what we call RB1. We have got a lot of that at Exxaro," Tsengwa said. "Our footprint in Japan is getting better," she added, without providing further details ahead of the company's results in March.
Exxaro, which also supplies coal to South Africa's struggling power utility Eskom, has seen lower export volumes as train derailments and infrastructure vandalism at freight logistics firm Transnet affected pit-to-port operations.
"We have really been suffering a lot but guess what, we are finding other alternatives. Maputo has been an alternative for us that is working quite well but it's an option that is not cheap because of the trucking element," she said, referring to the port city of Maputo in Mozambique.
With a war chest of up to 15 billion rand ($793.63 million), Tsengwa said the company remained on the prowl for new acquisitions mainly in copper in the Democratic Republic of Congo (DRC), Zambia and Botswana.
"We don't get approaches in manganese as much as we get in copper … We've got to chase for manganese," she said about potential acquisitions in South Africa, the world's top repository for the metal used in alloys such as steel.
South Africa's Kalahari Basin holds some 80% of the world's manganese ore body.
($1 = 18.9004 rand)
Editing by Aurora Ellis
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