Maputo, Mozambique — MININGREVIEW.COM — 12 August 2008 – The Mozambican authorities have issued 125 licences for coal exploration to date, mostly in the western province of Tete (96) and the northern-most province of Niassa (18).
Revealing this at a meeting with coal licence-holders here, mineral resources minister Esperanca Bias pointed out that 75 of these licences had been issued more than three years ago, which meant that some of the companies were, or should be, in the phase of pre-viability or viability studies for their projects.
“The international market is showing a noteworthy increase in demand for minerals – and particularly for coal – which is why we should focus as a matter of urgency on overcoming the current constraints, and on capitalising on the favourable scenario of coal demand,” she said.
Bias added that the government hoped to see value added to Mozambican coal inside the country, rather than simply exporting it all. She urged companies to design projects that would maximise the use of coal within Mozambique – “these could include, for example, the extraction of methane and its use, as well as gasification and the production of diesel from coal,” she suggested.
Quoting the Mozambique News Agency AIM, allAfrica.com reports that there are enormous confirmed reserves of high quality coking coal in Tete province, but currently only one small mine is in operation – Chipanga XI, which was once run by the now defunct state-owned coal company, Carbomoc.
The current leaseholder is the private company Minas de Moatize, which has a production plan of just 5 000 tonnes of coal a month. Its representative told the meeting that current production was around 4 500 tonnes a month, of which 30% was used by the Mozambican sugar and tobacco industries, and the rest was exported to Malawi, Tanzania, Zimbabwe, Zambia and the Democratic Republic of the Congo.
Such small amounts can be moved by road, but that is not an option for the huge projects that are on the drawing board for such companies as Brazilian mining giant, the Companhia Vale do Rio Doce (reserves of 2.4 billion tonnes); the Australian company Riversdale (reserves of 9 billion tonnes); and Changara Investments, a subsidiary of the London-based CAMEC (with reserves of over 900 million tonnes).
All these companies face the same problem – how to move coal for export to the coast. Reconstruction of the Sena railway line, from the Moatize line, will not be complete until mid-2009. Even then, it will only have the capacity to move eight million tonnes of coal a year, and further upgrading could raise the capacity to 12 million tonnes by 2011. But the mining companies are thinking in terms of much greater volumes of up to four times that capacity.
So other transport options being considered include: the use of barges to take the coal down the Zambezi; a new railway line west of the Zambezi heading south to connect with the Beira-Zimbabwe railway in Manica province; moving some coal by truck west of the Zambezi; and possible use the northern Mozambican port of Nacala.
Despite the logistical difficulties, the companies are optimistic, Riversdale describes the Zambezi Valley in Tete as “one of the largest undeveloped coking coal regions in the world”, and believes that mines here could meet the long-term demand for coking coal and high quality thermal coal.