Exxaro secures long-term coal deal for Matla Colliery till 2043

Exxaro Resources, a Gauteng-based diversified resource group led by Zimbabwean mining tycoon Bennetor (Ben) Magara, has signed a new long-term coal supply agreement with Eskom, securing supply from its Matla Colliery to the Matla Power Station through to November 2043, reinforcing one of South Africa’s most critical energy partnerships.

The agreement, which takes effect from April 1, 2026, replaces the original contract established in 1983 and ensures continued coal supply to Eskom’s baseload power generation fleet amid ongoing energy security concerns.

Securing long-term coal supply
Under the new coal supply agreement, Matla Colliery will deliver approximately 9.3 million tonnes of coal annually to Matla Power Station. The deal provides long-term revenue visibility for Exxaro while supporting Eskom’s efforts to stabilize electricity supply in Africa’s most industrialized economy.

To underpin the agreement, Exxaro has secured key regulatory approvals, including the renewal of its mining right and integrated water-use license in 2025, ensuring compliance and operational continuity over the life of the contract.

Backed by expansion investment
The agreement is supported by the ongoing R5.2 billion Matla Life-of-Mine expansion project, which Exxaro is executing on behalf of Eskom. The project is expected to be completed in the first half of the 2026 financial year, enabling the miner to meet its long-term supply commitments.

The expansion is designed to sustain production levels, extend the life of the asset and align output with Eskom’s long-term demand profile, reinforcing Matla’s strategic role in South Africa’s coal value chain.

Strengthening energy security
Exxaro Resources operates across South Africa, Europe, the Democratic Republic of the Congo, and the United States, with interests in coal, TiO₂, ferrous metals, and energy. Bennetor (Ben) Magara assumed the chief executive role on April 1, 2025, steering the company into a new phase following the exit of Nombasa Tsengwa. Tsengwa resigned in December 2024 after a precautionary suspension tied to an independent probe into governance and workplace conduct.

The renewed agreement underscores Exxaro’s position as a key supplier to Eskom and highlights the continued role of coal in South Africa’s energy mix, despite the global transition toward cleaner energy sources. By locking in long-term supply from Matla, Exxaro secures predictable cash flows while Eskom gains stability in fuel supply for power generation. The deal reflects a broader effort to balance energy security with operational sustainability in a challenging and evolving energy landscape.