Brazil-based mining com-pany Vale has opened a $1.7-billion coal mine in Mozambique, which will tap into the Southern African country’s thermal and coking coal reserves of about 23-billion tons, reports advisory and consultancy services company Hilbroy Advisory.

In May, Mozambique Presi- dent Armando Guebuza and Vale former chief Roger Agnelli attended the opening ceremony in Moatize, in north-west Mozambique, to mark the largest single investment to date in one of the world’s poorest countries.

Vale plans to export one-million tons of coal from the $1.7-billion project this year, ramping up production to 11-million tons in a few years and, local officials hope, boosting Mozambique’s current economic growth of 6.5%, the company says.

Mozambique’s coal reserves have been relatively untapped since the country’s independence from Portugal in 1975, while a civil war from 1977 to 1992 crippled the country’s economy and decimated much of its infrastructure.

In 2004, Vale became the first inter-national mining company to be granted a concession in Mozambique and, at the peak of preparations, the company had 6 000, mostly Mozambican, workers.

Hilbroy says Australian mining company Riversdale Mining, in partner-ship with India’s steel group, Tata Steel, will also start operations later this year at a nearby coal mine, which is expected to produce six-million tons of coal a year by 2016.

In February, Mozambique signed a third large coal contract with India-based steel manufacturer Jindal Steel & Power. The company hopes to produce 11-million tons a year of coal when the mine opens in 2012.

Reconstruction of the 600 km Sena railway line that connects the coal-rich Moatize district to the Indian Ocean port city of Beira has not yet been completed, the advisory firm reports. This is forcing authorities to reconsider the rail rehabilitation contract with railway engineers Rail India Technical & Economic Services and Ircon Inter-national through their joint venture company Ricon.

Though work is unfinished on the coal terminal at the port, Mozambique officials have sought to reassure that mining companies will be able to get their product to market.

Vale is investing in another railway line from Tete to the northern port of Nacala, the country’s only deep-water port. The company has signed a deal with Malawi to build about 100 km of the line across the country’s southern end, Hilbroy concludes.