Resource Generation (ASX: RES) is developing one of South Africa’s largest remaining coal deposits, with the company's focos on the Boikarabelo tenements, in the Waterberg region of South Africa.
The strategy for the company is to develop high grade “energy” related resources into viable and competitive mining operations. Accelerated shareholder value will be delivered through the delivery of physical mining activity.
Resource Generation (ASX: RES) has achieved a key milestone with the rail link route from the Boikarabelo mine to the existing Transnet rail line, located in the Waterberg region of South Africa.
Boikarabelo has around 745 million tonnes of thermal coal, which has the potential to increase substantially as this reserve amounts to only 35% of the resource bearing tenements.
Boikarabelo can therefore now supply large quantities of thermal coal to both the export and domestic thermal coal markets, over several decades.
As part of the rail line process, three farms are being acquired for a total of ZAR67.5 million, around A$10 million.
ZAR21.1 million was paid in the last quarter and the balance is expected to be settled this quarter.
Resource Generation said agreements have been signed to acquire an additional farm or a servitude across the farm.
Back in November 2010, the company raised A$30 million through the issue of 60 million shares at $0.50, to bring forward the construction of the rail link.