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Production to begin at Continental Coal mine

World Cement,

Australian-listed Continental Coal Ltd has announced that work is expected to commence at its Vlarkvarkfontein mine in South Africa in about two weeks. The company has current SAMREC resources of over 300 million t and holds interests in a number of early stage and advanced stage assets in several established South African coal mining regions.

Continental Coal has appointed reputable South African mining contractor Trollope Mining Services (TMS) for the development of the mine. Under the terms of the initial three-year contract, TMS is expected to deliver 100 000 t of crushed coal per month.

TMS will begin topsoil stripping at the site in about two weeks and conventional open cast mining is forecast to begin later in the first quarter of 2010.

According to the company, production will reach some 1 million tpa of domestic quality thermal coal and 350 000 tpa of export quality thermal coal over an initial 10-year mine life.

Offtake sales agreements, for the domestic use and export of the coal product, are currently being finalised with South African power company Eskom and a number of international coal trading houses.

The development at Vlarkvarkfontein will be the first of several South African coal projects owned by Continental Coal to begin production, with the others expected to commence within the next 6 - 18 months.

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