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First coal shipment from Mozambique on its way: ICVL

International Coal Ventures Ltd (ICVL), a joint venture of state-run firms, on Tuesday said the first shipment of coal from its recently-acquired Mozambique mine is on its way and will reach India by 24 November.

“The first shipment is on its way and it will reach India in next 4-5 days,” C.S. Verma, the chairman of ICVL, told PTI.

The ship-load of coal would be used by Steel Authority of India, Verma, who also heads Steel Authority of India, said.

ICVL had signed the pact on 28 July to buy Rio Tinto’s 65% stake in Benga and 100% each in Zambeze and Tete East coal assets in Mozambique for $50 million. Benga, the only operational mine, produces about five million tonnes (mt) per annum and is making cash losses.

There is a potential to increase production from the mine to 12 million tonnes per annum in the near-term. There is also significant potential for tapping coal-bed methane from the acquired coal resources. However, ICVL is yet to decide on using the CBM.

ICVL, a joint venture between SAIL, Coal India Ltd, Rashtriya Ispat Nigam Ltd (RINL), National Mineral Development Corp. Ltd (NMDC)and NTPC Ltd (NTPC), was created in 2009 to ensure long-term security of the supply of critical raw material for domestic steel industry. Availability of coking coal would also reduce their costs significantly. Indian steel makers mostly use imported coking coal.

SAIL and RINL are increasing their steel-making capacity to 23 mtpa and 6.3 mtpa respectively. Their need for coking coal would increase to a level of about 25 mtpa by 2015. NMDC is also in the process of setting up a three mtpa capacity integrated steel plant at Nagarnar in Chhattisgarh.

NTPC and Coal India did not participate in the Mozambique acquisition.

Source: PTI