Vale Mozambique, the majority-owned subsidiary of Brazilian major mining group Vale, has been ranked as the biggest company in the African nation for the second year in a row. This is the determination of a report for 2019, released by professional services firm KPMG, which lists Mozambique’s 100 biggest companies.

In second place is aluminium producer Mozal, located about 20 km west of the national capital, Maputo. (Mozal’s largest shareholder, with a 47.1% stake, is the South32 group.) In third place is the State-owned national electricity utility, Electricidade de Moçambique.

Vale Mozambique owns and operates the Moatize coal mine, in the western province of Tete, and is also a 35% shareholder in, and the operator of, the Nacala Logistics Corridor, which includes the railway linking Moatize to the port city of Nacala and the coal terminal at Nacala.

Last month, Vale’s group head office, in Rio de Janeiro, announced that it was going to take a “noncash impairment” of about $1.6-billion on the Moatize project during the last quarter of this year. This impairment will be treated as an exceptional item (as will a separate impairment of the group’s base metals operation in New Caledonia, in the Southwest Pacific) and will have no cash flow implications.

“Vale identified that the expected yield of metallurgical coal and thermal coal has changed since the inception of the project, mostly due to technical issues on the project and operations of these assets,” stated the group by way of explanation. “It also conducted a detailed review of the mining plan, which reduced the level of proven reserves and revised its metallurgical and thermal coal prices scenarios.”

A new mining plan for Moatize will be implemented. This will give priority to the better-quality deposits and so maximise the share of metallurgical (or coking) coal in mine production. There will also be a lower stripping ratio.

“In 2020, the Moatize operations will enter a three-month maintenance period and will implement a new operational flow sheet, increasing the plant’s productivity and yield,” Vale reported.