Ukraine Buys Coal From South Africa as Conflict Disrupts Mining

Sep 03, 2014 10:36 am ET

Sept. 3 (Bloomberg) -- Ukraine signed an agreement to buy 1 million metric tons of coal from South Africa to maintain power output after mining was disrupted from armed conflict with separatist rebels in the country’s east.

The first batch is being loaded in a port, Prime Minister Arseniy Yatsenyuk said at a government meeting today, without giving more details. Companies are arranging purchases, he said.

Half of Ukraine’s electricity is generated by natural gas and coal. Ukraine wants to reduce dependency on imported natural gas since Russia cut off deliveries on June 16.

Coal output declined since the main coal mining areas in Donetsk and Luhansk regions were paralyzed by armed conflict between government forces and separatists. Power distributors warned consumers of possible electricity cuts in peak hours in winter due to fuel shortages.

Militants in Donetsk and Luhansk region have stolen 15,000 tons of coal from Ukrainian mines, military spokesman Andriy Lysenko told reporters today in Kiev. The fuel is taken to Russia by trucks, he said. Fuel and Energy Minister Yuriy Prodan didn’t answer a phone call from Bloomberg seeking comment.

--With assistance from Daryna Krasnolutska in Kiev.