A bitter dispute between Liberty Coal and Kego Mining has spilled into the Mpumalanga High Court over the control of some mining rights at Optimum Coal Mine that re-opened earlier this year.
The re-opening of Optimum Coal Mine under the control of Liberty Coal in April, with potential to produce 13.5 million tons of the energy commodity, was expected to boost Eskom’s generation capacity.
The Optimum Coal Mine was previously controlled by the controversial Gupta family and President Jacob Zuma’s relative.
However, the National Prosecuting Authority (NPA) obtained a court application for two forfeiture orders on the grounds that the Guptas bought the mine from Glencore with proceeds from corruption.
Now, Liberty Coal has approached the Mpamalanga High Court to institute proceedings against Kego Mining “in relation to the illegal mining operations on the Optimum Coal Mine mining right” areas.
Liberty Coal accused Kego of mining “illegally mining from the disputed areas since April 2023”.
Liberty Coal is, therefore, claiming R600 000 in damages from Kego Mining “for the intentional, wrongful and unlawful conduct in relation to the extraction, processing and sale of approximately 900 000 tons of coal” from or about 1 April 2023 to March 2024.
Liberty Coal charged that of the 900 000 tons of coal mined by Kego Mining, some 850 464 tons had been mined while the Optimum Coal Mine was subject to a Preservation Order granted by the Gauteng Division of the High Court of South Africa.
The Preservation Order was obtained by the National Director of Public Prosecutions in 2022, said Liberty, and ordered the preservation of the property of Optimum Coal Mine and the appointment of a curator tasked with assuming control of the property and to take care it.
The appointed curator had “demanded Kego Mining to cease illegal mining operations” in September 2023, but Liberty further alleged that Kego Mining “ignored” this.
“Kego Mining’s continued illegal mining activities and the extraction of 900 000 tons of coal on Optimum Coal Mine’s mining area since April 2023 have caused a R600 million loss to Liberty Coal and its stakeholders,” said the company.
It added that such funds could have been utilised by Liberty Coal to rehabilitate the mine, pay off Optimum Coal Mine’s creditors in terms of the Business Rescue Plan, benefit the employees or community trusts, or pay Liberty Coal’s obligations to the NPA in terms of the settlement of the forfeiture proceedings.
Liberty Coal has previously stated that it was facing major financial pressure related to keeping Optimum Coal Mine in production while not having permits to export its coal.
After assuming control of Optimum Coal Mine, Liberty Coal was to pay around R460m to the State and assume liability for a further R1 billion owed to various creditors.
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