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You are here:   Home » About Exxaro » Prospects

Prospects

Exxaro is positioned for growth and presents investors with an exciting investment case. As South Africa’s largest, black-controlled and diversified mining company, its ability to grow domestically is significantly enhanced, while the existing operational interests in Namibia, Australia and China provide a base for growth in international markets.

The strong demand for commodities, driven primarily by growth in the US and China, together with the prospects for India, augurs well for Exxaro’s chosen commodities. The diverse portfolio consists of coal, mineral sands, zinc, ferrosilicon and dolomite together with emerging opportunities in ferroalloys. Exxaro’s 20% interest in the iron ore operations and expansions of Sishen Iron Ore Company further enhances its commodity profile.

The coal business, with a capacity of 45Mtpa, is on par with South Africa’s major domestic producers. Exxaro is the largest supplier of coal to Eskom for power generation and also South Africa’s largest producer of metallurgical coals. With the current energy crisis being experienced in South Africa, Exxaro has mines and reserves that are well positioned to meet additional coal needs for power generation. As a participant in the RBCT Phase V expansion, opportunities to open new mines and for brownfields expansion are being pursued. The construction of the Inyanda mine is testimony to this drive. Much focus is being placed on expansion in the Waterberg coalfield, which accounts for the major proportion of South Africa’s coal reserves and where Exxaro operates the world-class Grootegeluk mine. Exxaro has excellent reserves in the Waterberg and has the potential to produce a range of coal products to meet the needs of future growth in demand from different sectors. Initiatives are also under way to develop downstream into the reductant market.

Exxaro already enjoys a prominent global position in the mineral sands business, with operations in South Africa and Australia and the advantage of being totally integrated from mine to pigment production. Mineral sands is a strategically important growth area and with the recent acquisition of the minorities’ interests in Australia Sands as well as the option to acquire Namakwa Sands, the company will become one of the world’s top three producers of zircon and chlorinatable slag. With attractive mineral sands resources in South Africa and Madagascar, the opportunity to expand this business remains a key focus area. The existing plants in South Africa and Australia lend themselves to brownfields expansion and current planning entails a new mine in South Africa and expansion of synthetic rutile and pigment production in Australia.

Current zinc metal prices, which are expected to prevail for some time, give Exxaro the opportunity to grow its zinc business. The refinery expansion at Chifeng has been successful and further expansion of refinery capacity as well as a move upstream into mining zinc concentrate are being pursued. As South Africa’s only integrated producer, from mine to metal, opportunities to enhance Exxaro’s zinc reserves in Namibia and develop new concentrate supplies globally are a key focus area. These opportunities will be further enhanced if Exxaro exercises the Black Mountain option.

Strategic opportunities in the aggregate and industrial minerals environment will be assessed as a potential growth area for Exxaro in future.

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