ICVL, which acquired mines in Mozambique from British-Australian metals and mining firm Rio Tinto in 2014, is planning to step up its engagement in the country by establishing a thermal power plant.
NTPC and Coal India (which were previously part of the consortium, but decided to withdraw from it) have been asked to reconsider their membership in order to ensure the success of the proposed power venture.
ICVL’s key partners include SAIL (which is also the lead promoter), along with steel maker RINL, and India’s largest state-run miner NMDC.
“We see a lot of potential in Mozambique and we would like to harness it. ICVL’s mines in Mozambique contain 65% thermal coal reserves, with the rest being coking coal. There is a possibility of setting up a thermal power plant there”, said SAIL Chairman, P K Singh.
NTPC and Coal India had earlier said that they were not keen to continue their association with ICVL since they felt the company was formed predominantly to acquire coking coal mines for SAIL, RINL and NMDC, which have steelmaking interests.
NTPC had earlier informed the Indian Energy Ministry that it should be allowed to exit ICVL because its coal requirement is very different from those of steel companies such as SAIL and RINL, making the venture an unviable one for the company. Similarly, the Coal India board had taken a decision to withdraw from ICVL in February 2015.
The two companies have strengths that would be very useful in the proposed power venture, an unnamed senior government official said. The initial capacity of the power plant will be 200MW, which could be expanded up to 2,000MW in the future. “NTPC has core competency in power generation, a strength that will be crucial in the venture, while Coal India – the largest domestic coal producer – has proven expertise in mining”, the official said.
“The power generated in Mozambique can be fed to other African countries too”, he added. The development signals India’s enthusiasm to develop its presence in Africa.
ICVL had acquired 65% stake in the Benga mine and 100% each in Zambeze and Tete East coal assets in Mozambique for US$50-million from Rio Tinto. The remaining 35% shareholding in Benga mine is with Tata Steel.
Created in 2009 to secure metallurgical coal and thermal coal assets abroad, ICVL has set a target of achieving coal reserves of 500 million tons by 2019-20.
Source: The Economic Times
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