After dry and wet runs of the wash plant at the site as well as the integration of the screen with the broader processing facilities, UK development company Contango Holdings confirmed production of washed coking coal beginning 23 May at its flagship Lubu project in Zimbabwe.
Officials said coking coal stockpiles have already been established by the Wirtgen surface miner, which has the capability to mine up to 1,000 tonnes per hour. The miner continues to extract coking coal and is increasing the wash plant stockpiles further.
“The company will continue to undertake studies on washed coal production to ensure optimisation,” Contango said, adding that samples will be sent to several parties seeking long-term offtake deals. This includes, it noted, its potential strategic partner under a memorandum of understanding, which complements its existing offtake for 10,000 t per month of washed coal.
“All coking coal produced, including coal dispatched as samples, will be sold at factory gate, with the current MMCZ price still set at US$120 per tonne. The company expects to announce the first sales of washed coking coal in June 2023,” it said.
CEO Carl Esprey called the start “a landmark moment” for Contango.
“It is no small feat to bring a mine into production and something most junior mining companies never achieve. I appreciate this process has taken longer than expected, but we are now producing a high-quality coking coal product and very soon will be a revenue generating company. We have achieved this during turbulent markets and without significant dilution at the plc level, which is testament to the team assembled in-country and the attractiveness of the Lubu project.
“The focus for the company is now how to best expand operations at Lubu, leveraging off our producer status. The sheer scale of Lubu opens up significant potential across a variety of revenue streams and we intend to focus on unlocking the potential of Lubu from this very solid foundation.”
Source: Contango Holdings