Jindal Africa – Mozambique will remain active in Mozambique, despite the sharp drop in the price of coal on international markets, the Director-General of Jindal Africa Investments group said.
The price of coal per ton has fallen from US$250 to a current average of US$100 and several mining companies have either left their concessions in Tete province, in the face of huge losses, or put those assets up for sale.
Cited by the Mozambican press, Chandra Singh said the subsidiary in Mozambique had to undertake a restructuring that included termination of contracts with sub-contractors in order to reduce operating costs.
These statements come shortly after Coal India Ltd and Tata Steel, both from India, publicly announced they wish to dispose of operations in Mozambique in the coal sector.
Tata Steel will refrain from making new investments in the coal sector in Mozambique and plans to sell the assets that it controls, including a 35 percent stake in the Benga coal mine in Tete province, where it had Anglo-Australian group Rio Tinto as a partner.
Coal India, which recently announced it would step out of the state consortium created to find coal abroad for domestic consumption, is expected to announce in September the final decision on the departure or not from its two operations in Mozambique, allegedly due to poor quality of coal that is being mined in Tete province. (macauhub/MZ)