Friday, December 3, 2010

COAL INDIA TO START DRILLING IN TETE

Coal India Ltd (CIL) plans to start exploratory drilling for coal in the blocks allocated to it in the western Mozambican province of Tete within the next two months, and hopes to start coal production by 2013, according to reports in the Indian press.CIL, which is 90 per cent owned by the Indian government, won the tender for two blocks last August, and has a licence to explore and develop them over the next five years. It subsequently set up a wholly-owned subsidiary in Mozambique. Coal India Africana Limitada (CIAL), and has promised to sell off 15 per cent of this company to a body nominated by the Mozambican government, once the size of the reserves in its blocks has been established. A CIL spokesperson, interviewed by the “Economic Times” of India, said that a CIL subsidiary, the Central Mine Planning and Design Institute (CMPDIL), will be in charge of the exploratory drilling.The CIL blocks cover an area of 205 square kilometres. Preliminary estimates are that the coal reserve is about a billion tonnes. 20 per cent of this is expected to be coking coal, and the rest thermal coal. 'Exploration on an area of 205 square kilometres will take a lot of time”, said the CIL spokesperson. “However, we will start exploratory drilling on areas which are promising. We will execute drilling in these areas following which mining will start. It takes at least two years to start mining in any area.' Coal India is one of several companies that hold coal exploration licences in Tete. The companies that are most advanced, and expect to start exporting coal next year are the Brazilian mining giant Vale, and Riversdale Mining of Australia.

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