London, England — 05 December 2012 – UK-listed coal group Ncondezi Coal Company says it will press ahead with a US$627 million thermal coal project in the Tete province of Mozambique, following completion of a definitive feasibility study that recommends the mine be constructed in phases.
Miningmx reports that the mine will produce 18Mtpa run-of-mine (ROM) domestic and export thermal coal, most of which would be supplied to a power plant Ncondezi Coal announced it would build earlier this year.
This announcement follows a separate definitive feasibility study which recommends a phased approach to the power plant build which would consist in its first stage of a 300MW unit requiring the supply of 2Mtpa ROM from the coal mine.
Construction of the power plant was targeted to start in 2014 with commission anticipated by 2017, Ncondezi Coal said. Capital expenditure for the plant was being refined in addition to the search for a strategic partner, but initial indications pointed to a US$504 million outlay for 300MW.
Capitalising on the fact that Mozambique’s electricity market is expected to grow by 2,000MW over the next 10 years, Ncondezi Coal said the power plant could be expanded in 300MW increments to 1,800MW by 2023 for a total outlay of US$2.25 billion. This excluded the transmission lines, which will cost a further US$247 million.
“Mozambique is the fastest growing electricity market in southern Africa and the largest exporter of power to South Africa,” said Nigel Walls, CEO of Ncondezi Coal.
“We believe that focusing on a 300MW integrated mine and power plant as the first phase of development is the best route to bring the Ncondezi’s project into production by 2017,” he added.
Source: Miningmx. For more information, click here.