Logistics problems have little effect on investments by Brazilian group Vale in Mozambique

16 September 2013

Investment ear-marked for Mozambique by Brazilian mining group Vale is unchanged at US$8 billion and difficulties carrying coal away from the group’s projects have not affected it, said the director of Vale Moçambique, Ricardo Saad.

The director of Vale Moçambique told Portuguese news agency Lusa that, although the restrictions on transporting coal had required an additional initial investment, the company is not exporting the quantities it expected.

“The projection is exports of 4.5 million tons per year but we have yet to reach that level. We started production in August 2011, in 2012 we exported almost 3 million tons and in 2014 we expect to reach the maximum capacity of the Sena line that is available to Vale,” said Saad.

The Sena railroad, which carries the coal from Moatize to the port of Beira in the centre of the country, does not operate at its projected capacity due to a number of problems.

To overcome these difficulties, Vale Moçambique, owned by Brazilian group Vale, announced an investment of US$4.5 billion to build a 250 kilometre section of the Nacala railroad, to carry the coal from Moatize to the port of Nacala, in the north of the country.

The director of Vale noted that the railroad to the port of Nacal was considered essential to carry the coal produced in the expansion phase of the Moatize mine.

Once the Nacala railroad and port of Nacala are operational, the current capacity is doubled, along with the group’s share of the Sena railroad’s capacity, Vale expects to export up to 22 million tons of coal per year, starting in 2017. (macauhub)