Australian miner Riversdale Mining Limited has announced that its subsidiary Riversdale Mozambique Limitada has signed a contract with MCC Contracts Pty Limited (MCC), a wholly owned subsidiary of EQSTRA Holdings Limited, services provider for various sectors including mining, for open pit mining services at the Benga coal mine, a joint venture between Riversdale (65 percent) and Indian steel giant Tata Steel (35 percent) in Tete, Mozambique.
The contract covers open pit mining and associated services required for the initial Stage 1 development of the project.
The Benga license, received from the government of Mozambique in April 2009, involves the commitment of US$270 million (excluding working capital) to undertake the initial Stage 1 development of the project, which entails initial production of 5.3 million mt per year to produce approximately 1.7 million mt of high quality hard coking coal and 300,000 mt of export thermal coal per year.
The company believes the scale of the resources at Benga allows for cost-effective open cut mining, with the potential to produce 20 million mt of coal per year for a period of more than 25 years.
As SteelOrbis previously reported, the President of the Republic of Mozambique, Armando Emilio Guebuza, recently attended a formal groundbreaking ceremony at the Benga coal project.