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RBCT and Optimum Coal Owner Ink Export Terms Deal

Richards Bay Coal Terminal (Pty) Limited (RBCT), Liberty Coal (Pty) Limited/Liberty Coal Terminal (RF) (Pty) Limited, alongside the business rescue practitioners of Optimum Coal Mine (Pty) Limited (in business rescue) (OCM) and Optimum Coal Terminal (Pty) Limited (in business rescue) (OCT), are delighted to announce the successful agreement on terms and conditions for the export of coal from the Optimum Coal Mine through the RBCT terminal. This agreement is subject to the finalization of rail arrangements with Transnet. Subject to any unforeseen circumstances, the parties are looking forward to commencing coal exports to the RBCT terminal in early April 2024.

Simultaneously, Liberty Coal and the business rescue practitioners of OCM and OCT will persist in executing the business rescue plans and related transaction agreements. Their objective is to finalize all required registrations pertaining to the transfer of OCM’s mining assets, including immovable properties, by January 31, 2025. On February 1, 2024, Liberty Coal officially took over complete operational management of the Optimum Coal Mine, gaining beneficial occupation and possession of OCM’s assets in the process. Moreover, Liberty Coal has undertaken the compromised claims of OCM’s and OCT’s respective creditors.

Upon substantial implementation of the rescue plans, contingent on fiscal, statutory, and other relevant considerations, OCM and OCT will undergo formal discharge from their business rescue proceedings. RBCT eagerly anticipates the rejuvenation of the Optimum Coal Mine under Liberty Coal’s management. RBCT and its stakeholders perceive this revival as a significant and sustainable contributor to employment opportunities and economic activity within the greater Steve Tshwete municipal region and to the South African fiscus.

This agreement marks a significant turning point for Optimum Coal, signaling its revival after a period of dormancy. The export of coal is expected to safeguard around 500 jobs in Mpumalanga. In 2016, Optimum Coal was acquired by Tegeta Resources, a company owned by the Gupta family. Allegations from the National Prosecuting Agency (NPA) suggested that the acquisition was financed through theft and fraudulent activities, including the misappropriation of funds from Transnet and Eskom, among others.

Recently, Liberty Coal and RBCT found themselves at odds over accusations of unfair treatment towards Optimum Coal. Reports indicated that RBCT was demanding additional conditions from Liberty Coal, expressing concerns that Optimum Coal lacked sufficient capitalization from shareholders to cover operational expenses.

Established in 1976, Richards Bay Coal Terminal (Proprietary) Limited (RBCT) stands as a premier coal export terminal globally. Initially designed with a capacity of 12 million tons per annum (Mt/a), RBCT has significantly expanded over the years, evolving into a sophisticated 24-hour operation with a remarkable design capacity of 91 Mt/a. RBCT offers South Africa’s Coal Exporting Parties (CEPs) a top-notch logistics service, facilitating the efficient export of coal.

By Sasha Fernandes