Shiploads of coal from Mozambique have cast a shadow of uncertainty over the future of coal mines in the Northern Region, Business Review can reveal.
Secretary for Natural Resources, Energy and Mines Ben Botolo has said local mining companies are fast losing grip of the existing market as Vale Logistics’ newly-constructed railway line, which transverses the Southern Region from Kachasu in Chikwawa to Nkaya in Balaka, has lessened the cost of importing the fuel mineral from the neighbouring country.
The Brazilian mining company constructed the rail line to reduce the cost of hauling coal grains from the coalfields of Moatize on the eastern part of Mozambique to the Indian Ocean port of Nacala on the western end.
But Botolo said the race for foreign coal is taking a toll on mines in Rumphi and Karonga.
He said: “There is a general problem in the coal industry where the country is increasingly importing coal tax-free from Mozambique. We need to protect our coal mines, investors and the jobs at stake.
“Presently, we are already talking to our friends at the Ministry of Industry and Trade to see how we can control the influx of this cheap, low-grade coal which is getting into the country without paying tax.”
Botolo hinted at the potential closure of coalmines in Karonga, especially Malcoal at Kayerekera and Magnum at Mpata.
Fears of looming closure are also gaining sway in Mwaulambo where Eland Coal Mining has been extracting coal for almost seven years.
Mwaulambo residents, speaking last Friday at a community meeting jointly supported by Centre for Environmental Policy and Advocacy (Cepa), Livingstonia Synod’s Church and Society (CAS) and ActionAid, talked about water and air pollution as mining activity grinds to a near-halt.
Mines Department spokesperson Levy Undi said government has received no notice of closure from Eland Coal Mine and the mining firm’s director Leon Rademeyer, who is said to be abroad for holiday, did not respond to our questionnaire. n