Reuters reported that South African logistics group Transnet is committed to raising capacity on its coal export rail line despite a policy debate that could curb outside sales if the commodity is declared a strategic resource.

Coal exporters in South Africa, which include Anglo American , Exxaro, Sasol, BHP Billiton and Xstrata Coal, have long been eager to export more coal to supply growing demand from power plants in Asia.

Transnet has been investing heavily to upgrade its ageing infrastructure and push more coal through the Richards Bay Coal Terminal on South Africa's Indian Ocean coast.

The group moved 67.7 million tonnes of export coal in the year to the end of March, up 8.8 percent on the previous year.

But the ruling African National Congress is debating whether to declare coal a strategic resource to ensure South African power plants are well supplied. The country relies on the dark rock for about 85% of its power needs.

Mr Brian Molefe at the company's annual results briefing said that "There will always be coal that will be exported for the foreseeable future. I don't think we (South Africa) will ever consume all the coal we have."

Transnet in April launched a ZAR 300 billion (USD 36.3 billion), seven year capital expansion program meant to upgrade its rail and port infrastructure and boost capacity, especially on the lines carrying coal, iron ore and manganese.

Part of the plan is to raise capacity on the coal export line to 98 million tonnes by 2019 and position South Africa as a key exporter of thermal coal.

Source - Reuters

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