Vale secured a contract to build and operate a coal mine at Moatize to export coal through rail to Beira, a Mozambican port in 2006.
The coal mine will produce 1.56 million metric tons of coal this year and 11 million tons of coal per year in its first stage of development and the output is expected to reach to 6.37 million tons at Moatize by 2012.
Around two thirds of output from the coal mine is of metallurgical coal for the global steel industry and the rest is of thermal coal for use in power generation.
Australian mining company Riversdale Mining also has coal leases in the area and to transport coal from Moatize for export through Beira, a railway line of 670km of railway has to be upgraded at a cost of $375m.
Vale general manager for coal marketing and sales Marcelo Matos said the company plans to double the capacity to to 22 million tons of coal in 2014 as part of Vale’s strategy to boost its global coal output to 40 million tons a year by 2016.
