Arnot Opco – Mine Re-establishment on track despite COVID-19 delays

Employee led coal mine Arnot Opco is on track to have its first coal on the conveyer belt by the first quarter of 2021. The company has forged ahead to get operations under way timeously, despite the delays caused by the COVID-19 lockdown in South Africa.

Speaking at this year’s Junior Indaba, Arnot Opco CEO Bontle Aphane shed some light on the team’s progress since officially taking over Arnot mine from resources giant Exxaro in February 2020.

“From an infrastructure point of view, we are about 75 percent ready to roll out our first coal produce. So we expect to put out our first coal on the belt next year. We are quite excited about that,” Aphane explains.

Getting to this level of readiness has not been without its challenges for the team tasked with re-establishing the mine. When Arnot Opco took over operations earlier this year, the mine was stripped and flooded. Furthermore, underground and surface infrastructure had been dismantled as part of the rehab and closure plan. 

The team works under the leadership of Aphane, who is no stranger to coal mining. Her vast experience in the industry is backed with a Bachelor of Engineering in Electrical Engineering. Ever the scholar, she’s currently enrolled in an Executive Business Leadership Programme at Harvard University, which will hold her in good stead for the hard work that lies ahead for the team.

Aphane is also no stranger to the Exxaro family, she was one of the 1200 workers retrenched in 2015 when a coal supply agreement between Eskom and Exxaro came to an end. She and seven other former colleagues identified an opportunity to take over the mine and turn it into an employee-run coal mine. 

They later formed a company called Innovators Resources. While getting the mine ready, the company’s executives are also working hard to secure buyers for the coal they will be producing. They are currently in conversations to supply a number of power stations. 

The company’s solid rail and conveyer belt infrastructure gives it an edge against peer junior miners and more established and larger miners. “We sit with a unique opportunity to have structures that will give us the ability to be agile and move with speed which is what the larger companies struggle with. So, from an infrastructure point of view we can comfortably compete with the larger players. At the same time from an agility point of view and a cost control point of view we can compete with the junior miners because we have an opportunity to press the reset button,” says Aphane.

Over the next few years, the mining firm will focus on how to grow and maximise Arnot Opco’s remaining lifespan. “We want to be the last man standing when it comes to coal producers. We are going to achieve this by making sure that we control costs and allocate capital diligently”.

Mining analyst Peter Major says Arnot Opco’s success will depend on securing really good mining contracts. While many pundits question the future of coal mining, Major believes that despite the bad reputation, there is still huge demand for it.

The company will also look to agriculture and energy to help it diversify when mining eventually ceases.