BEACON HILL READY TO SEND COAL TO BEIRA IN JULY

The British company Beacon Hill Resources on Wednesday announced that it has begun to produce export grade coking coal from its open cast mine at Moatize, in the western Mozambican province of Tete. It plans to start trucking coal to the port at Beira in July. The coal will be stockpiled at Beira pending the first export shipment.In a statement to the Beacon Hill Annual General Meeting, the company’s Chairperson, Justin Lewis, said “we are delighted to announce the commencement of operations at Minas de Moatize with production of its first washed export grade coal. This is another significant milestone for the development of the Minas de Moatize coal mine, which, has been achieved in less than a year since we acquired the mine”.Minas de Moatize initially consisted of an underground mine, which has been producing small amounts of coal for domestic use, and for export to neighbouring countries, such as Malawi. But since taking ownership of Minas de Moatize, Beacon Hill has switched the focus to open cast mining. It is developing a large open cast mine that will produce 2.35 million tonnes of coal per year, of which 0.9 million tonnes will be in the form of the more valuable coking coal. The company will start by mining 15,000 tonnes of coal per month.The company has a temporary processing unit to wash and grade the coal, and will process a stockpile of 39,000 tonnes from its underground mine to test the unit and the logistics of getting the coal to market.Although it will begin moving coal to Beira by road, the company intends to use the Sena railway line from Moatize to Beira to shift 1.8 million tonnes of coal per year. The company states that “the operators of the Sena railway line remain confident of being able to transport initial volumes of Minas Moatize coal in the second half of this year”.However, the company does not want to completely rely on this, and has organised for trucks to transport to Beira up to half a million tonnes per year.The Zambezi basin is considered to be one of the last undeveloped coal basins in the world. However, this is about to change. The Brazilian company Vale will shortly begin exporting from its mine at Moatize while Rio Tinto’s mine at Benga, run by its subsidiary Riversdale, will also soon be operational.Vale is expecting to eventually produce 25 million tonnes a year, whilst Riversdale forecasts that Benga will produce 10 million tonnes of coal a year. Riversdale’s mine in the adjacent Zambeze concession area will in late 2014 begin producing up to 25 million tonnes a year. A third Riversdale area, Tete East, could contribute a further 10 million tonnes.Other mining companies are also sitting on large reserves. The British company Ncondezi hopes to export ten million tonnes per year beginning in the second half of 2014.Transport is the critical bottleneck. The renovation of the Sena railway line is far from complete. Even when fully operational the line will be unable to cope with the huge amounts of coal flowing from the region.Both Vale and Riversdale are looking at alternative means of moving the coal. Vale plans a new railway linking Moatize to the northern Mozambican port of Nacala. Such a line would have to cut across southern Malawi. Riversdale has proposed taking the coal to the Indian Ocean on barges down the Zambezi River.There are now 36 mining companies operating in Moatize district, and between them they have so far created 10,811 jobs, according to the Moatize district administrator, Manuel Guimaraes.