Exxaro Resources Limited
Integrated report 2022

Business resilience

Our intellectual capital comprises the unique combination of knowledge, experience, innovation and systems that differentiate Exxaro. We leverage these elements to respond to market challenges and position our business for the future.

Technology and innovation are evolving exponentially – driving changes to patterns of production, consumption and ways of working. Exxaro is focused on both driving and leveraging those changes that can positively impact our business's value and sustainability. We apply our collective knowledge, skills and resources to ensure our business is responsive while safeguarding our people, assets and the business.

We strive to positively impact our intellectual capital through:

  • Maintaining our competitive advantage through innovation and digitalisation
  • Using our intellectual capital and differentiation to transition our already successful business into a company that remains sustainable, growth orientated, values driven into the future
  • Becoming a leading international renewable solutions provider by 2030

Material theme


Our strategic response

Our impact on the SDGs

Adapting to a changing context

  • Geopolitical context
  • Country risk
  • Supporting a just transition to a low-carbon economy
  • Transition at speed and scale
  • Make our minerals and energy businesses thrive
  • Become a catalyst for economic growth and environmental stewardship
  • Proactive reputation management

Executing our strategy

  • Portfolio optimisation (coal and investment)
  • Diversify into minerals
  • Build a leading global renewable energy solutions business
  • Implementing high-impact socio-economic development programmes

Driving business resilience

  • Capital allocation
  • Cyber risk
  • Innovation and digitalisation

How we achieve this

Our operations must be able to overcome frequent challenges and adapt to change in global and local markets. We do this through efficient project portfolio management and capital allocation, increasing our competencies across mining and renewable energy, and investing in innovation, digitalisation and technology.

Business resilience comprises:

Snapshot of our performance

Inputs Outcomes
Capital allocation
  • GG6 completed
  • Developed infrastructure projects for Matla
  • Engagements with Eskom about funding in progress
  • GG6 small coal plant handed over to Grootegeluk operations
  • Matla will be able to produce 10Mtpa of thermal coal
Investments in renewable energy
  • Acquired full ownership of Cennergi in 2020
  • Financial close for the first solar plant for supply to the Grootegeluk mine expected in the second quarter of 2023
To be a leading international renewable energy solutions provider by 2030 to:
  • Fulfil own generation needs
  • Expand South African services and distributed generation footprint
  • Potential to decarbonise current business operations (scope 1 or 2 emissions)
Driving innovation and information management
  • Collaborating through open innovation
  • Our RRODA platform/tool
  • Cybersecurity awareness campaigns
  • Core system availability: 97.94% (2021: 99.55%)
  • Secure scorecard: 76.35% (2021: 63.45%)
Reputational resilience
  • Stakeholder reputation surveys
  • Stakeholder reputation
  • Stakeholder sentiment

Capital allocation

Exxaro continues to focus on the portfolio of growth and sustaining capital projects by executing our early value strategy and our capital excellence journey.

Salient features for 2022

Capital expenditure decreased
by 33% from 2021 to

R1 652 million

R1 401 million
applied to sustaining and environmental capital (stay-in-business capital) (2021: R1 635 million)

R251 million
invested in new capacity (expansion capital) (2021: R836 million)

Project Classification (growth/
Product Focus and
Capital expenditure Outlook
Location: Waterberg (Limpopo)
We commissioned the GG6 expansion project's new small coal plant, and all four modules are in production. We combined, converted, improved and expanded the capacity of the existing GG2 plant into an efficient double-stage beneficiation plant, with all modules in production. The forecast final cost at completion remains R5.3 billion.
GG6 expansion Growth 1.7Mtpa of semi-soft coking coal Expanding the existing Grootegeluk 2 plant to enable production of semi-soft coking coal R5.3 billion First production through the small coal plant was achieved during the first quarter of 2021. Construction was concluded during the fourth quarter of 2021. The project will close by the first half of 2023.
Location: Mpumalanga
We implemented a programme of infrastructure projects to support Matla to achieve a 10Mtpa production objective once fully ramped up. Exxaro continues to engage with Eskom to release the required funding to execute the full scope of the programme.
Matla LoM programme Sustaining 10Mtpa of thermal coal Developing infrastructure to support LoM production R3.8 billion Construction of the box cut and silo for Matla Mine 1 has been completed. We aim to complete the tunnel development and incline conveyor in the second half of 2023. Equipment manufacturing is progressing as planned. We aim to complete Mine 2 and 3 development in the first half of 2025. We expect to complete and conclude the programme in the second half of 2025.


Capital expenditure in our coal business decreased 33% lower compared to 2021, driven by 72% lower spend on expansion capital as we completed the construction of the GG6 plant.

Sustaining capital decreased by 12% due to less spend at Grootegeluk and Belfast. We are starting to realise the benefit of our Capital Excellence journey which is a combination of project savings and improved timing on project execution.

Coal sales by product tonnes

Coal sales by product tonnes (%)
% change 
Sustaining  1 374  1 430  1 564  (4)
Waterberg  1 117  1 158  1 285  (4)
Mpumalanga  252  256  261  (2)
Other  5  16  18  (68)
Expansion  231  257  840  (10)
Waterberg  231  257  709  (10)
Mpumalanga  131  (100)
Total  1 605  1 687  2 404  (5)

Investments in renewable energy

No investments in renewable energy were made for the year under review. However, progress was made on developing the Lephalale solar project during the year. The intent is to target financial close by the first half of 2023, thereafter followed by construction. The project will cost between R1.52 billion and R1.58 billion to develop 68MW.

Driving innovation and information management


  • Our established centres of excellence (CoEs) support our digitisation strategy
  • The business applications CoE drives citizen development, which is empowering end-users to develop their own non-complex applications and workflows to improve task execution and productivity
  • Data analytics is embedded in the way we do business with BUs using dashboards to enable decision making
  • The intelligent automation CoE has automated 34 business processes since 2018, which has resulted in saving 90 000 hours over three years
  • We use NAVEX One's conflict of interest solution and standardised policy management
  • Our learning management solution embraces digital learning capabilities
  • We deployed the Slope Stability Monitoring solution to monitor the movement and slopes of high walls. It also triggers evacuation in emergency situations
  • We deployed a solution that designs blasting plans and monitors implementation
  • Our electrical condition monitoring manages conditions of the substations
  • We use Etap modelling of electrical networks for simulation of electrical networks
    • We deployed an Pix4D solution for drone surveying at Belfast and Grootegeluk for survey in the professionals in training (PIT) programme

Innovation is the ultimate white label word, the definition relying on the context in which it is used. Within Exxaro's context innovation is defined as the discovery, incubation, and implementation of cutting-edge solutions with the aim of adding value by refining efficiency, increasing effectiveness, and enhancing competitive advantage.

Due to the broad nature of innovation and its reliance on the context in which it is intended to be used, innovation is further categorised into four classifications namely, sustaining, incremental, radical and disruptive. Radical and disruptive types of innovation have been difficult to identify, source and implement while keeping focus on our core business. The innovation management team identified access to the broader innovation ecosystem as the best port of call to source these radical and disruptive innovation while not being inhibited by typical search engine constraints.

Exxaro's innovation management strategy is aimed at identifying areas where innovative solutions will support Exxaro's strategy. Innovation management's approach is underpinned by gaining access to an innovation ecosystem through partnerships with industry bodies, tech disruptors and innovators, it is anticipated to have a global reach of capabilities to assist in solving business challenges.

Exxaro's innovation strategy promotes collaboration with people and organisations outside the company. It promotes the belief that knowledge and creative initiatives from outside the company can contribute to achieving strategic goals.

In 2022, the innovation management team established the foundational elements required to project Exxaro's innovation journey to enable elements of the broader Exxaro strategy. This included external and internally focused efforts, the first of which was embedding within and aligning innovation to business optimisation and supply chain management processes. This was to enable key internal processes to support and embed innovation. This further supported the successful establishment of an ecosystem, resulting in a working relationship with a range of external innovation partners. A number of challenges were published to the innovation ecosystem focused on decarbonisation and improving operational efficiencies. The result of these challenges was exposure to innovative technologies that could not have been uncovered through traditional processes, one of which translated into approval to proceed with proofs of concept to test a solution at Mafube and Grootegeluk.

The achievements and traction of 2022 bode well for the 2023 roadmap and plan. With further development and extracting value from the implemented foundational elements completed in 2022, an additional focus area for 2023 looks to develop a systematic approach to innovation that will further embed innovation into the business planning and strategy process. This will enable the necessary strategy, processes, governance, resources and measurement to further enhance Exxaro's innovation journey.


With the ever-increasing cyber threat landscape, we have intensified our efforts to secure and safeguard our information and digital assets. There is continuous commitment and focus on enhancing our internal capabilities to identify, detect, respond and recover in the event of a cyberattack.

To improve our security posture and resilience, we are strengthening our controls to align with global best practices and deployed several systems to facilitate this. These include a data loss prevention tool to address privacy risks relating to sensitive information, continuous monitoring of our control environment by performing self-assessments and independent reviews to ensure the effectiveness of our mitigation actions and remediation of weaknesses. In so doing, we improved our cybersecurity score by 12.9% since the beginning of 2022.

Driving innovation

Exxaro takes great pride in our deep-rooted culture of innovation. We firmly believe that innovation is not limited to any particular department within the organisation, but rather, it is the responsibility of all employees to contribute to this effort. Our various departments, with their unique objectives and goals, are constantly innovating in different ways. For example, the business optimisation department focuses on efficiency, while the strategy and business transformation department concentrate on management innovation. Further, the projects and technology function is responsible for equipping our BUs with cutting-edge, forward-looking technologies, to ensure we keep on thriving as technology evolve within mining.

To ensure that all our functions have the necessary resources and capabilities to search for, identify, access, and accelerate these innovations, we have equipped our people with various innovation tools. These tools allow our employees to critically evaluate the need and implications of innovation, ensuring that purpose-driven innovation is at the heart of all our initiatives, and that value is continuously added to the triple bottom line.

One of the tools we have equipped our people with is access to an ecosystem approach to search for, identify, and access innovation. We recognise that innovation is amplified when knowledge and ideas are not isolated within our organisation. Therefore, we collaborate and partner with key stakeholders, such as government, research institutions, incubators, and accelerators. By taking a systems approach to solve large and systemic problems, we are able to leverage the strengths of these organisations and benefit from their expertise.

We place particular importance on collaborating with government stakeholders since they play a crucial role in driving energy innovation and implementing the incentives and regulations needed to stimulate investment in energy innovation, its deployment and uptake.

Delivering on our strategy and future focus

We will be futureproofing Exxaro and enabling a sustainable future for our business. We aim to fast track our decarbonisation and investments to generate predictable long-term cash flows and increase portfolio diversification. As the company matures, we will build on an already successful platform, leveraging our skills and differentiation with a long-term vision to develop a sustainable, growth-orientated, value-driven company, a leading international renewable solutions provider by the end of the decade.

Our capital allocation and project execution remains focused on leveraging the growth investments already made, supporting our early value coal strategy and sustaining our businesses by implementing our portfolio of stay-in-business capital projects. Our early value strategy means we are strategic about our capital allocation. We embarked on a capital expenditure journey in managing our sustaining capital, ensuring we sustain a robust coal portfolio with strong cash flow generation. We continue disposing of non-core assets. We continue on our capital excellence journey in investing in our coal business to remain resilient. We are targeting average capital of between R2 billion and R2.5 billion annually in real terms. As part of the early value strategy, the GG6 expansion was completed in 2022.

For our energy business, Exxaro is targeting an additional 1.6GW (net) capacity by 2030 with total capital deployment of approximately R28 billion. We estimate that one third will be our equity contributions and two thirds project financing. This could potentially provide approximately R3 billion in EBITDA in real terms. We are aiming to achieve equity returns on a portfolio basis of 15%.

We are focusing on opportunities in South Africa to start with, while monitoring opportunities in new markets for potential entry that meet our investment criteria, building strong foundations for the future and investing in renewable energy assets that enable us to transition to a low-carbon world.

Case study: Protecting our business through digital transformation

In the information era, data is the "new gold". Our Digital@Exxaro programme is therefore geared to enable us to leverage the big data generated within and around us, and create value. Our dream is to be a data-driven organisation. Leveraging our integrated operations centres and data platforms, we are deploying advanced data analytics and machine learning to solve current problems and futureproof our business. One such use case is the implementation of the machine learning model to proactively monitor and manage our haul road conditions in our pits.

The quality of the roads is one of the challenges that contribute to the overall value chain performance. If not well managed, bad road conditions lead to truck downtimes and reduced production throughput. The ability to proactively monitor the road conditions and prevent the deterioration before it impacts the hauling operation tempos, cycle times and truck reliability, is critical.

We are implementing a machine learning solution that leverages big data from our truck sensors like vibrations, truck speed, geolocation to predict the haul road conditions. This solution will enable the operations team to identify the deteriorating road conditions in real-time and repair the roads resulting in improved hauling performance. The successful implementation of this solution will not only improve throughput but will also reduce truck suspension failures.

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Driving transition through leadership
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About our integrated report
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About Exxaro
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Our business model
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Our strategy: positioning Exxaro for sustainable growth and impact
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