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Intra Energy warns of higher coal costs

3rd September 2019

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

     

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PERTH (miningweekly.com) – Thermal coal miner Intra Energy on Tuesday warned customers that costs for its Tanzanian coal would increase after the mining commission from that country demanded that a royalty be imposed on the transport of coal.

Intra Energy operates the Tancoal mine, which has been in production since 2011.

Coal from the mine is transported some 52 km to a sales point in Kitai, from where it undergoes final processing and is loaded onto customer trucks.

The ASX-ilsted company on Tuesday said that the Tanzanian Ministry of Minerals and Mining Commission has now directed Tancoal to charge royalties to customers on their cost of transport.

A 3% royalty and a 1% clearance and inspection fee will be charged on the cost of transport from the Tancoal mine to customer plants for both domestic and export customers, with the largest domestic customers now paying an additional $2.94/t of coal, while the largest export customers will pay an additional $8.23/t.

The Mining Commission has warned that it will not issue coal transportation permits after September 15 if the royalty on transport is not implemented.

Since Tancoal does not own any trucks, the company will be forced to sell to licensed dealers buying on behalf of customers.

Intra Energy told shareholders that the company was in discussions with both the government and customers to find a suitable solution.

Edited by Creamer Media Reporter

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