Mozambique: Coal reserves in Benga are 90 percent bigger than forecast

24 April 2009

Sydney, Australia, 24 April – Coal reserves in the Benga region of Mozambique, are 90 percent larger than initially projected, concession-holders, Australia’s Riversdale Mining and India’s Tata Steel, said Thursday.

“These coal resources [4 billion tonnes] represent a 90 percent increase in relation to those previously announced in September 2008,” the companies said in a statement.

The consortium announced that the quantities of coal now estimated at Benga, in the Moatize district of Tete province, had been calculated “based on figures obtained from recent prospecting activities.”

The statement also said that “these reserves were estimated according to an analysis that assumes initial gross production of 5.3 million tonnes of thermal coal per year, which will later rise to 10 million tonnes per year, as transport facilities become available.”

In order to mine the coal at the Benga reserves, Riversdale, which owns 65 percent of the mine, and Tata Steel Limited, with 35 percent, plan to invest over US$800 million.

The Australian company is also involved in the project to build a coal-fired power plant in Mozambique, expected to cost US$3.1 billion.

Riversdale recently announced that preliminary tests on the quality of coal from the mining concession at Benga, had shown “first quality” coal.

Brazilian mining company Vale is also due to mine Mozambique’s largest coals reserves, in Moatize, estimated at 10 billion tones. (macauhub)