Mozambique grants mining contract to Tata Steel JV

Mozambique has awarded a mining contract to Tata Steel and its JV partner Riversdale for the Benga coal project in the African country, which would yield over 20 million tonnes of the dry fuel every year.      

The world's sixth largest steel producer, Tata Steel, has a 35 per cent stake in the project besides a secured right for 40 per cent of the produce to feed its Corus facilities in the UK and Europe.      

The project, which will entail an investment of over $800 million, is likely to commission production in 2010, Australia's Riversdale Mining said on its website.      

"The mining contract provides a basis for Riversdale mining to be producing coal at Benga in 2010," Riversdale Chairman Michael O'Keeffe said.     

The terms of the mining contract have been approved by the Council of Ministers of Mozambique, and Riversdale Mining has received a decree signed by the country's Prime Minister, Luisa Dias Diogo, the website added.      

The contract covers all aspects of proposed development of the mine, including exploration, feasibility, operations, fiscal regime and rehabilitation, among others.      

Following the awarding of the mining contract, the terms and conditions will be incorporated into the Benga project feasibility study now, due for completion in the current quarter, the statement added.