Rio Tinto sells Mozambique coal assets for $50m

Two almost simultaneous items of news on India-related international coal mining developments are worth noting…not only for their combined news value but also for the timing. Given that India itself is perched on one of the world's biggest coal reserves, is its Government-driven initiative to fast-track domestic private sector commercial coal mining moving too slowly to provide the full solution to the country's near and longer term shortage of power generation? If so, will Rio Tinto's US$50-million sale of a mine and other coal assets in Mozambique's Tete province to an Indian JV (reported here by Reuters), coupled with Australian approval for a $15,5-billion Indian-owned coal mining project in Queensland  provide adequate insurance for the future. At this stage India's surging electricity consumption seems to be at a point beyond its ability to mine enough coal for power plants to generate it. GK

By Silvia Antonioli

LONDON (Reuters) – Global miner Rio Tinto said on Wednesday it has agreed to sell its coal assets in Mozambique to International Coal Ventures Private Limited, a joint venture of Indian companies, for $50 million.

The sale of Rio Tinto Coal Mozambique, which comprises the Benga coal mine and other projects in the Tete province of Mozambique, is subject to certain conditions and to regulatory approvals and is expected to be completed in the third quarter this year.

ICVL is a joint venture set up by the Indian government for the acquisition of coal assets overseas to meet the coal needs of some state-owned companies.

The companies in the joint venture are Steel Authority of India Limited, Coal India Limited, Rashtriya Ispat Nigam Limited, National Minerals Development Corporation Limited and National Thermal Power Corporation Limited.

Rio acquired the Mozambican assets in 2011, when it bought Riversdale Mining.