Introduction

South Africa's indigenous energy resource base is dominated by coal. Internationally, coal is the most widely used primary fuel, accounting for about 36 percent of the total fuel consumption of the world's electricity production. About 77 percent of South Africa's primary energy needs are provided by coal. This is unlikely to change significantly in the next two decades owing to the relative lack of suitable alternatives to coal as an energy source. Many of the deposits can be exploited at extremely favourable costs and, as a result, a large coal-mining industry has developed.

In addition to the extensive use of coal in the domestic economy, about 28 percent of South Africa's production is exported, mainly through the Richards Bay Coal Terminal, making South Africa the fourth-largest coal exporting country in the world.

South Africa's coal is obtained from collieries that range from among the largest in the world to small-scale producers. As a result of new entrants, operating collieries increased to 64 during 2004. Of these, a relatively small number of large-scale producers supply coal primarily to electricity and synthetic fuel producers.

About 51 percent of South African coal mining is done underground and about 49 percent is produced by open-cast methods. The coal-mining industry is highly concentrated with five companies accounting for 85 percent of saleable coal production. These companies are:

• Ingwe Collieries Limited, a BHP Billiton subsidiary;
• Anglo Coal;
• Sasol;
• Eyesizwe; and
• Kumba Resources Limited, accounting for 85 percent of the saleable coal production.

Production is concentrated in large mines, with 11 mines accounting for 70 percent of the output. South African coal for local electricity production is among the cheapest in the world. The beneficiation of coal, particularly for export, results in more than 65Mt of coal discards being produced every year.

About 21 percent of the run-of-mine coal produced is exported, and 21 percent is used locally (excluding power-station coal). The rest is not saleable and is discarded.

The remainder of South Africa's coal production feeds the various local industries:

• 62 percent is used for electricity generation;
• 23 percent for petrochemical industries (Sasol);
• 8 percent for general industry;
• 4 percent for the metallurgical industry (Mittal); and
• 4 percent is purchased by merchants and sold locally or exported.

The key role played by South Africa's coal reserves in the economy is illustrated by the fact that Eskom ranks first in the world as a steam coal user and seventh as an electricity generator. Sasol is the largest coal-to-chemicals producer.

By international standards, South Africa's coal deposits are relatively shallow with thick seams, which make them easier and, usually, cheaper to mine. At the present production rate, there should be more than 50 years of coal supply left.

Source: South Africa Yearbook 2005/2006

Clean coal utilisation

Environmental concerns pose the main challenge to coal as energy source. Particulate emissions from household burning of coal and the mining activities to extract coal impact negatively on the environment.

The DME and the coal-mining industry are fostering the introduction of clean coal technologies. The South African National Low Smoke Fuel Programme, which forms part of the Clean Air Strategy, includes the Basa njengo Magogo technique, which addresses particulate emissions.

The principle thrust for clean coal utilisation is addressing the high levels of air pollution provided by the combustion of coal in households.

Read more about the integrated household clean energy strategy [PDF, 492KB]

Coal is expected to maintain its share of the overall electricity generation market until 2020. Total discards on the surface could reach more than 2-billion tons by 2020 should none of this material be used. However, the DME is investigating ways to promote and encourage economic use of the discards.

Download the national inventory discard and duff coal: 2001 summary report [PDF, 1.46MB]

Carbon sequestration

South Africa has joined the Carbon Sequestration Leadership Forum that investigates technologies to sequestrate carbon. Carbon sequestration refers to processes that remove carbon from the atmosphere in order to store it.

In addition, South Africa has acceded to the Kyoto Protocol as a non-Annex I country, and its participation is scheduled to be through the Clean Development Mechanism, once the Protocol comes into force.

Coal resources and reserves

The uncertainty of the availability of significant amounts of economically extractable coal reserves for future use means that the generally expected dependence on coal well into the foreseeable future is also uncertain. So it is imperative to re-evaluate the national coal resource and reserve base to assist the government in formulating an efficient energy policy with regard to future coal energy supply.

In 1987, the Bredell report estimated South Africa's coal reserves as 55-billion tonnes and 115 billion tonnes of resources) is based on the Bredell report of 1987. The study to ascertain the amount of coal reserves and resources in South Africa is in progress. The efficient utilisation of coal reserves demands the production of different but very specific saleable products to satisfy the market requirements. Hence Bulletin 114 provides the required information on specific saleable coal products and generated discard coal that will facilitate the long-term planning and optimal utilisation of coal reserves.

Coal discards

The result of the beneficiation of South African coals are the generation of approximately 60-million tonnes per annum of discard coal, which is estimated to have already accumulated to more than 1-billion tonnes.

While these large amounts of carbonaceous material negatively affect the environment, they also contain significant amounts of usable coal. Discard coal is a major concern to the DME regarding the potential environmental impact in the future. It should also be seen as a major resource that could provide economic opportunities.

In 2001, the DME commissioned a survey to establish an inventory of the discard and duff coal in South Africa.

Download the national inventory discard and duff coal: 2001 summary report [PDF, 1.46MB]