The Obtala Limited group plans to make use of the closed forestry season in Mozambique to lay the foundations to expand its business and increase productivity of the ongoing operations in the country, the group said in a statement issued on Monday.
The closed season on forest resource exploration imposed by the government of Mozambique from 1 January to 31 March of each year is also being used by the group to carry out maintenance and repair of equipment as well as to plan activities to the end of 2017.
As a result of repairing some equipment, the Mozambican subsidiary of the group made use of the wood that was cut in the fourth quarter of 2016 to produce 1,500 sleepers, which were delivered to customers in February and increased the capacity of its sawmill located in Uape to process an average of 9 cubic metres of wood per day.
The group intends to increase the two concessions that were in operation at the end of 2016 to five operating concessions, and is currently in the process of hiring foremen as well as other staff and equipment, which should reach the site in the second quarter of this year.
The statement also said that a location has been identified for a new sawmill to be built in Nampula, and that construction of buildings and installation of equipment should be completed by the end of 2017, which will add a capacity of about 100 cubic metres per day.
The Obtala group, based in Guernsey, has 10 forest concessions in Mozambique covering an area of 120,000 hectares.
In a statement issued on Tuesday the group announced that it had reached an agreement in principle with Wealth Bank Limited, a Hong Kong-based company, to issue 20 million shares with an issue price of 4 million pounds.
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