Mozambican government grants two new coal mining concessions

21 August 2013

The Mozambican government has granted two new coal mining concession in Tete province valid for periods of 25 years to Rio Tinto Moçambique and to Midwest Africa, the deputy Mining Resources Minister, Abdul Razak said.

The deputy minister added that the two contracts would be made public as soon as they are signed off by the Administrative Court, under the terms of the law on public-private partnerships, approved in 2011.

Midwest Africa’s project is located 50 kilometres from the city of Tete and covers an area of 158.4 square kilometres. Its feasibility study showed estimated reserves of 480 million tons of coal, of which 363 million tons are coking coal and the remainder is thermal coal.

According to Mozambican daily newspaper Notícias investment in this Indian project will total some US$1.416 billion and as of 2019 production is targeted to be 1 million tons of coking coal and 6 million tons of thermal coal per year.

The Mozambican state, represented by Empresa Moçambicana de Exploração Mineira, will have a 5 percent stake in the project, and another 5 percent will be sold on the stock exchange to Mozambican citizens. The concession contract for Rio Tinto outlines exactly the same conditions.

Rio Tinto Moçambique’s concession is on a project known as Zambeze, with an area of 97 square kilometres about 10 kilometres from the city of Tete, where the Anlo-Australian group plans to invest US$3.3 billion in order to produce, as of 2023, around 7 million tons of coking coal and 5 million tons of thermal coal per year.

The deputy Mining Resources Minister said that as of 2014 the railroad between Moatize and Nacala would be able to carry 18 million tons of coal per year, in addition to the 6 million tons per year now carried along the Sena Railroad linking the coal region to the port of Beira. (macauhub)