Coal of Africa Limited (CoAL) has announced that Australia-based Lachlan Star has bought its South Africa-based Holfontein coal project for AU$25 million ($23.6 million) in cash and shares. The transaction also includes an option agreement covering the adjoining Wildebeestfontein Farm.
Commenting on the deal, CoAL managing director Simon Farrell said, "This agreement allows CoAL to concentrate on our larger Mooiplaats and Limpopo coal projects, while taking an interest in Lachlan Star."
With the sale of the Holfontein project, CoAL will become the largest shareholder in Lachlan Star.
The project in question is situated in the Witbank coal field and contains 55 million tons of coal in an area of 1,160.8 hectares. CoAL has indicated that it is capable of producing 400,000 tons of soft coking coal and 800,000 tons of thermal coal on an annual basis.