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Mozambique’s new coal export route will start operations soon

31st July 2015

By: Keith Campbell

Creamer Media Senior Deputy Editor

  

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The new coal export terminal at the port of Nacala-a-Velha, in Mozambique’s Nampula province, should load its first ship in August. That was reported last week by Corredor Logístico de Nacala (CLN – Nacala Logistics Corridor) director José Otoni. This represents a delay of eight months in comparison to the original plan, as the Mozambique Ministry of Transport and Commu- nications had affirmed in the middle of last year that coal exports through the new terminal would start in December 2014.

Limited amounts of coal have already arrived and have been stockpiled at the Nacala terminal. According to the Macauhub news agency, the amount is 50 t, while the O País newspaper puts the figure at 500 t. “In 2017, when we reach the installed capacity of the port, we will be exporting 22-million tons of coal a year and, up to this date, we will be exporting 18-million tons of coal a year, when we will be operating with 89 locomotives and 1 862 wagons,” said Otoni. He was briefing the country’s Interior Minister, Jaime Basílio Monteiro, who was visiting Nampula. His visit coincided with the processing of the legal documents authorising the docking of the first bulk carrier at Nacala to load coal. This vessel had originally been assigned to dock at Beira.

The coal to be exported through Nacala will come from the Moatize coalfield, in the country’s western province of Tete. Hitherto, the miners (led by Brazilian major Vale, the first to develop a mine in Moatize) have had to depend on the Sena railway from Tete to Beira, but this has so far proven to be inadequate. Currently, the 575 km Sena railway has an annual capacity of 6.5-million tons/year (Mt/y). It can run trains composed of only two locomotives and 42 wagons each. Phase 1 of Vale’s Moatize mine alone could (if it was not restricted by transport constraints) produce 11-Mt/y, while Phase 2, under development, will increase this to 22-Mt/y. The Moatize district also contains ICVL’s Benga and JIndal Steel & Power’s Chirodzi operations.

As a result, Vale established CLN and started the development of an alternative coal export route to Nacala via Malawi. CLN was originally a joint venture (JV) between Vale and Mozambique’s ports and railways company CFM, with Vale holding 80% and CFM the remaining 20%. However, in December, the miner announced that it had sold half its share of CLN to Mitsui of Japan. As a result, the CLN JV is now 35% Vale, 35% Mitsui and 20% CFM. (Vale also sold 15% of Vale Moçambique, its local subsidiary which owns and operates Moatize, to Mitsui, which means that Vale now holds 81% of Moatize, as its original share in the mine was 95%.) The total length of the Moatize–Nacala railway is 912 km, of which 684 km is existing track that has been refurbished, and 228 km is new track, laid mostly in Malawi. The total capital expenditure for both the railway and port is reported to be $4.444-billion.

Meanwhile, the Sena line is being substantially upgraded. By the end of this year, its capacity will be 20-Mt/y and it will be able to run 10 to 11 trains a day, each train being composed of six locomotives and 100 wagons.

Further, earlier this month, Mozambique President Filipe Nyusi assured that the proposed Macuse port and railway project would be implemented within the next five years. This will see a new 525 km railway built from Moatize to Macuse, in Zambézia, where a new port will be built. The cost of the entire project has previously been estimated at $3.5-billion and it will provide a third export route for coal from the Moatize district.

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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