Exxaro announced on Friday that the construction of a new small coal plant at its Grootegeluk mine in Limpopo would be delayed after it terminated its agreement with Group Five Projects, a subsidiary of Group Five Construction.
It said that more than 740 contract workers will be impacted by the decision.
"Barring unforeseen incidents, the Group 5 Projects scope was due to be completed at the end of May 2019. The decision will regrettably now result in a delay to the project," said Exxaro in a media statement.
Group 5 entered business rescue earlier this month.
"Exxaro has notified Group 5 of its decision and has embarked on discussions to mitigate the business impacts arising from this very sad situation. In the meantime, however, Group 5 Projects workers and subcontractors have moved off-site."