Exxaro has decided to terminate its agreement with Group Five Construction subsidiary, Group 5 Projects, with effect from March 21, following Group Five’s announcement that it has embarked on business rescue proceedings.

Exxaro in April 2017 appointed Group 5 Projects to build a new small coal plant as part of the Grootegeluk Plant 6 (GG6) expansion project at its Grootegeluk mine, near Lephalale, in Limpopo.

Barring unforeseen incidents, Group 5 Projects’ work was due to be completed at the end of May.

In a statement on Thursday, Exxaro noted its regret that the decision would now result in a delay to the project.

Exxaro has embarked on discussions to mitigate the business impacts arising from this situation.

In the meantime, Group 5 Projects’ employees and subcontractors have moved off-site.

Exxaro is engaging with its labour support (both legal and human resources) to maintain stability on site.

“It is indeed a sad day as more than 750 contract workers will be impacted by this decision,” commented Exarro Projects & Technology executive head Johan Meyer.