South Africa-focused coal miner Continental Coal Ltd (ASX: CCC) reported on Tuesday that it has surpassed the company's monthly target of 100,000 tonnes when its July output reached a total of 101,899 tonnes of thermal coal at its Vlakvarkfontein coal mining site.

The Perth-based company said that its mining site just 100 kilometre of Johannesburg has been showing signs of stable production capability since it commenced operations in May as company chief executive Don Turvey added that "we are confident that sustained monthly coal production levels of 100,000 tonnes can be achieved in the December 2010 quarter and beyond."

Continental Coal said that three short-term off-take contacts have been sealed by the company since the site started production activities in the second quarter of the year and the firm is optimistic that longer terms deal would come on its way as the rest of 2010 wears on.

Mr Turvey expressed confidence that Continental Coal would be able to sell its Vlakvarkfontein production forecast in the South African market at its projected high market prices on the heels of the fully established off-take contracts that the company had secured by the mid-part of this year.

He added that the anticipated sale transactions from the company's initial output would provide for the cash flow that Continental Coal would utilise in funding its other mine development activities.

At present, the company is working on ten coal projects in South Africa, which Continental said were projected to deliver more than 10 million tonnes of run-of-mine coal within the next five years.

Continental Coal shares quickly reacted on the news of the upgraded production as company shares traded up at 6.4 cents by 1234 AEST on Tuesday, picking up gains of 0.2 cents or 3.23 percent from previous trading sessions.