HomeEnergy MineralsNcondezi coal mine to cost US$250 million

Ncondezi coal mine to cost US$250 million

Drilling underway at
Riversdale’s Benga mine
“’ neighbour to Ncondezi
London, England — MININGREVIEW.COM — 11 June 2010 – Ncondezi Coal Company Limited “’ an exploration and development company with four coal exploration and prospecting licences in the Tete Province of Mozambique “’ says it will cost as much as US$250 million (R1.9 billion) to develop a coal project in the country aimed at starting production in 2015.

“We’re probably looking at somewhere in the region of US$200 to US$250 million (R1.5 to R1.9 billion) on current knowledge to reach initial production,” CEO Graham Mascall said in a telephone interview here, where the company was listed on the AIM..

“Ncondezi is targeting production of 2 million metric tonnes a year from 2015, before raising output to 10 million tonnes a year by 2020, at a cost of an additional US$130 million (R975 million),” Mascall said.

The company holds four Mozambique exploration licenses adjacent to projects owned by Vale SA, the world’s biggest iron- ore exporter, and Riversdale Mining Limited, which is developing its mine with India’s Tata Steel Limited, and expects to produce 5.3 million tonnes of coal per year.

Ncondezi sold US$52 million (R390 million) of shares in an initial public offering in London this week, and will use the funds to extend exploration of its coal assets in Mozambique and conduct a bankable feasibility study.