Diversified miner Exarro Resources has facilitated a transaction that enables former employees of Exxaro Coal Mpumalanga to participate in 50:50 joint venture that is set to acquire the assets and liabilities of the Arnot coal mine, in Mpumalanga.

On February 22, Exxaro signed a transfer agreement with the Arnot OpCo consortium, whose shareholders are former employees of Arnot and coal mining company Wescoal.

CEO Mxolisi Mgojo on Thursday noted that, while Exxaro was willing to transfer the assets to workers at no cost, the group had recognised that, in order for the mine to be sustainable, the workers would need a “strong” operator.

“We approached Wescoal . . . said there’s an opportunity to create a new exciting empowerment company out of this asset . . . the workers will bring in the mining rights and the other assets on the ground as part of their equity, you bring in the cash.”

Mgojo stressed that given the stipulations in Mining Charter 3, workers will gain a further 5% stake in the operation, which means that Arnot mine will effectively be 55% worker-owned.

“This is a historic moment . . . imagine the significance in terms of transformation in the mining industry.”

He said the aspirations of the charter were about envisioning a means of creating and supporting worker ownership, and that the new Arnot mine will see those aspirations realised.

He added that the transfer is still subject to regulatory approvals, as well as a Section 11 approval from the Department of Mineral Resources and Eskom’s transferring of the coal supply agreement.

Mgojo also lauded the workers’ spirit and initiative to approach Exxaro to find a way to restart the Arnot mine and unlock its value. “For me personally, there’s nothing as painful as it was to actually inform those workers that they lost their jobs . . . [the transaction] is a dream come true.