In many areas of Natal the early settlers found coal exposed on the surface.

A geological survey in 1880 proved there were workable deposits in a 3000km2 area of northern Natal, with especially rich deposits on the farm Dundee and neighbouring properties.

A pioneer of the Natal coal mining industry, Peter Smith, laid out a town on Dundee to serve as a centre for several mines. It soon grew to be a substantial trading and railway centre such as Dannhauser, Glencoe, Wasbank and Elandslaagte, also in the area.

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