Nippon Steel group may review interest in mining project in Mozambique

12 April 2013

Japanese group Nippon Steel & Sumitomo Metal Corp may review its involvement in the Minas do Revuboé mining project in Mozambique if a main partner with mining experience does not materialise, a group official said recently.

“Essentially we are steel producers and if the main partner of the consortium does not have solid experience in mining then the project in Mozambique is not as interesting,” Shinichi Fujiwara told financial news agency Reuters.

At the beginning of the month the AngloAmerican group announced it had dropped out of buying a 58.9 percent stake in the Minas do Revuboé coking coal project for US$555 million.

The group, which recently announced a loss of 239 million pounds in 2012 due to a drop in the price of some commodities and an impairment of US$4.9 billion related to the Minas-Rio project, in Brazil, said in the statement that the transaction depended on some conditions that were not met following nine months of negotiations, and “it was decided not to move ahead with the deal.”

Fujiwara was speaking just a few days after Nippon Steel Trading Co., a subsidiary of the Japanese group, was granted a license for the Minas do Revuboé project where its only current partner is South Korea’s Posco, which is also a steel maker.

The Minas do Revuboé coal project in Tete province has estimated reserves of 1.4 billion tons and an estimated annual production of 5 million tons of coking coal. The Japanese group plans to import around 1.7 million tons of coal or 6 percent of its annual imports from Mozambique. (macauhub)