Despite continuing to make a loss, coal miner Vale Moçambique will continue to make major investments in its assets in Mozambique. This assurance was given at a midmonth press conference in Maputo by the company’s board chairperson, Márcio Godoy.
These assets are the Moatize coal mine, in Tete province, and the Nacala Logistics Corridor, a 912 km railway line that links Tete and Moatize to the coastal port city of Nacala, through Malawi. The company is a subsidiary of Brazilian major mining group Vale.
The Vale group owns 81% of Vale Moçambique, Japanese group Mitsui 14% and Mozambique shareholders own the remaining 5%. (Mitsui also owns 5.51% of the parent Vale group, and last month expressed interest in increasing this stake.) Regarding the Nacala Logistics Corridor, which carries Moatize’s coal to the sea, for export, this was developed by Vale, which originally owned 70% of the operation. Subsequently, half of this was also sold to Mitsui, so that today Vale and Mitsui each hold 35% and jointly control it.
At the end of the first half of this year, Vale Moçambique had debt of $7.9-billion. This was $100-million greater that the accounted figure at the end of the first quarter of this year, reported company executive director Marcelo Tertuliano. Net income during the second quarter continued to be negative, at minus $193-million, compared with the first quarter figure of minus $139-million. The main negative effects on the operation during the second quarter came from heavy rains, increased operational costs, and a strengthening in the Mozambique currency, the metical.
Tertuliano did report some good news. Coal production during the second quarter was higher than during the first quarter at 2.9-million tons (Mt), compared with 2.4 Mt. Revenues from the sale of coal also increased. The second-quarter sales revenues of $354-million were $17-million higher that those accrued during the first three months of the year.
The Mozambique State benefited from these increases. While it received $5.1-million in royalties during the first quarter, this figure rose to $6-million during the second quarter.
The Moatize coal mine produces both metallurgical (or coking) and thermal coal, with the former being its primary product. Apart from minority shareholdings in a couple of joint ventures in China, it is currently the Vale group’s only coal operation. During the second quarter, Vale’s total metallurgical coal production amounted to 1 559 000 t, compared with the 1 401 000 t achieved during the first quarter. This was an increase of 11.3%. Thermal coal output in the second quarter amounted to 1 313 000 t, up from the 1 031 000 t of the first quarter. This represented a rise of 27.4%.source: miningweekly