Indian state mining group Coal India Ltd (CIL) plans to dispose of 75 percent of the area of two coal blocks acquired in Mozambique about six years ago, said a company official cited by Indian newspaper the Economic Times.
The paper added that this decision came after the government of Mozambique approved the doubling of the costs associated with maintaining the blocks, which to date have not revealed the presence of coal in commercial quantities.
“At a meeting of the board held last week, it was decided that Coal India Africana Ltd African would retain just 54 square kilometres of the 205 square kilometres that it had acquired,” said the official, according to the newspaper.
The source also said the decision was taken after completion of a three-year prospecting programme, which revealed that over 75 percent of the combined area of the two blocks contained nothing that could be dubbed coal.
About six years ago, CIL acquired an exploration and development license valid for five years on the A1 and A2 blocks in the central province of Tete, after which it formed the subsidiary Coal India Africana Ltd.
A source cited by the Indian newspaper said that initially the group was told the two blocks contained a blend of quality coking and thermal coal with reserves estimated at 1 billion tons but said, “a three-year prospecting programme revealed that over 75 percent of the combined area of the two blocks contained nothing that could be dubbed the coal.” (macauhub/MZ)