9 February 2012 Maputo — The Kazakhstan-based company, the Eurasian Natural Resources Corporation (ENRC) is planning to build a railway from the western Mozambican province of Tete to the northern port of Nacala, according to its general manager, Paul Craven
Speaking in Cape Town to the "Dow Jones Newsletter", Craven said the ENRC railway was planned to handle an initial 60 million tonnes of coal a year.
This is the second proposed railway from Tete to Nacala. The Brazilian mining company Vale is well advanced with plans for a railway which will run from its open cast mine in Moatize through southern Malawi to link up with the existing Malawi-Nacala line.
Craven says that the ENRC railway will avoid Malawi, and will run entirely through Mozambican territory. He claimed that this would be both shorter and cheaper than the Vale route. The Vale railway has an estimated cost of four billion US dollars.
He expected the railway to be completed by 2015. But before this can happen, a detailed route must be worked out, and the required social and environmental impact studies must be held.
The problem for all the companies investing in the vast coal deposits in Tete is how to move the coal to export markets. The existing railway to the port of Beira, the Sena line, can only handle six million tonnes a year, with a possibility of doubling that figure, if improvements are made.
Nacala is an attractive option, since it is generally regarded as the best deep water harbour on the east African coast. Unlike Beira, Nacala does not require dredging. But to reach Nacala from Tete, new railways are needed.
Craven said the ENRC would have port facilities at Nacala adjacent to Vale's. He expected them initially to have a capacity for 40 million tonnes of coal a year, rising to 60 million tonnes, and with a possibility for expansion to 100 million tonnes at a later stage.
ENRC has so far not mined any coal at all in Tete. It has 12 exploration licenses in the province, and is currently working on one at Estima. The Estima project is expected to produce 20 million tonnes of coal a year by 2015-16. By 2020, ENRC expects production to rise to between 30 and 40 million tonnes a year.
ENRC was founded in Kazakhstan, and although it has expanded across the globe, and is quoted on the London stock exchange, its main assets remain located in Kazakhstan