Mozambique’s president admits difficulties with transporting coal out of Moatize

6 September 2007

Sao Paulo, Brazil, 6 Sept – The president of Mozambique, Armando Guebuza, said Wednesday in Sao Paulo there were difficulties with transporting the coal that will be mined by Brazilian company Companhia do Vale do Rio Doce (CVRD) at Moatize, in the interior of Mozambique.

“We are aware that the region’s railroads are not sufficient,” the president told the press, after a business meeting at the headquarters of the Federation of Industries of Sao Paulo (Fiesp).

He noted that, unless there were additional resources to improve the railroads and deal with port cargo, “there will be no way of transporting the entire 11 million tons that Vale plans to mine annually.“

“There are several companies interested in investing in increasing transport capacity,” Guebuza said. “We want to support them and set up conditions, perhaps using state resources,” he added.

CVRD, which in June was granted the coal mining rights to Moatize, hopes to mine 8.5 million tons of coke for the metals industry and at least 2.5 million tons of coal for power production.

At the beginning of August, the uncertainty about the transport structure to be used led to the chairman of CVRD, Roger Agnelli saying that it would be necessary to find exit ways to make the mine economically viable.

Guebuza said that the solution would be “worked out in conjunction with vale,” and that a study was being carried out for repairing the railroad linking Moatize to the port of Beira, or its entire reconstruction.

“However, resources are needed to dredge the port of Beira, which currently does not have the capacity to allow large ships to enter it,” Guebuza noted.

One alternative is to use the port of Nacala, which is considered to be the best natural port on the country’s eastern seaboard.

Guebuza is on an official visit to Brazil until September 7, taking part in meetings on biofuel and bilateral trade agreements. (macauhub)