Johannesburg — SA COAL Mining Holdings (SACMH) said yesterday it had lifted volumes, raised yields and cut costs at its Umlabu colliery, which was expected to improve the mine's performance this year.

Umlabu Colliery was SACMH's only producing asset as its Ilanga colliery would not start operation until certain licence issues were resolved with adjoining landowners, CEO Karl Gribnitz said.

He hoped Ilanga could be in operation in about a year.

In its first six months of operation, Umlabu broke even. It produced less coal than budgeted because of heavy rains in January and February, delays in setting up the processing plant and managerial issues. It also sold its coal below spot prices because of prearranged contracts, which had now ended.

Gribnitz said Umlabu was realising about $81/ton for its coal in the six months to June against spot prices of about $116/ton, but was now realising about $120/ton. In the first six months, Umlabu's profit margin was about 55%, with yields at about 35%. Yields improved under new management, and were expected to be about 45% or better. Umlabu was now producing about 80000 run-of-mine tons a month.

Umlabu exported 65000 tons of coal via Richards Bay Coal Terminal, less than expected because of lower production and unavailability of trains.