Mining Industry: Vale Suspends Coal Transport From Mozambique Mines


Train From Moatize Complex Attacked; Conductor Injured.

Brazilian mining company Vale SA said Wednesday it has temporarily suspended the transport of coal out of its mines in Mozambique after a train conductor was injured in an attack that authorities are blaming on former rebel group Renamo.

The company said the conductor is in stable condition after being shot in the leg Tuesday night, when a train carrying coal from Vale’s Moatize mining complex to the Indian Ocean port of Beira came under gunfire.

Mozambique’s deputy interior minister, Jose Mandra, said on state radio that the attack was carried out by Renamo, a right-wing opposition movement that battled the government during the country’s 1977-92 civil war. The group had functioned as a political party for years but began clashing with the Mozambican government in 2013.(The Wall Street Journal – Write Paul Kiernan at

“Vale’s operations on the line are temporarily suspended to allow better progress in the investigations,” the company said in a statement. Vale officials added that mining at Moatize hasn’t been affected and that it has sufficient inventories at port to continue shipping coal out of Mozambique.

The attack threatens to derail efforts by the East African country to draw more foreign investment into its abundant natural resources and move past the civil war. It also validates the concern that several firms, including Vale, expressed last year when Renamo resumed attacks on the government and said it would no longer abide by the peace deal that ended the war.

In June, the former guerrilla group threatened to disrupt the Sena rail line used by Vale and rival mining company Rio Tinto PLC to transport coal out of Moatize. The warnings led Rio Tinto RIO.LN +1.01% to temporarily suspend its shipments and later evacuate the families of its foreign employees from Mozambique.

Vale took no such action, however.

Portuguese-speaking Mozambique is the biggest destination for Vale’s investments after Brazil, receiving 22% of the company’s capital expenditures. The company plans to spend $2.07 billion through 2015, digging a second coal pit at Moatize, and aims to finish its $4.44 billion logistics corridor to the Nacala port by the end of this year.

Vale produced 3.82 million metric tons of coking and thermal coal in 2013, up 1.3% from the previous year as logistical constraints hampered shipments. The company ultimately aims to produce 11 million tons of coal at Moatize.

A Rio Tinto spokesman declined to comment on the status of his company’s shipments in Mozambique, saying only that the company was informed of the incident and is in contact with state-owned rail operator CFM.

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