December 03, 2008

Mozambique approves CVRD’s mining contract for Moatize

Brazilian miner Companhia Vale do Rio Doce announced that Mozambique government has approved the mining contract for the exploitation of the Moatize coal project, located in the northwestern province of Tete in Mozambique.

This process begun in November 2004 and the last steps to be taken comprehend the mining concession and the conclusion of the negotiations with the local railroad and port operators for the logistics contract. This event follows the approval of the project development plan by the Mozambican authorities in early June 2007.

As per the release, the contract has duration of 25 years, which can be extended for additional periods of time, and establishes the tax, international trade and foreign exchange regimes that will rule the CVRD investment in Moatize.

The project involves the exploitation of an open pit mine for 35 years, with an estimated average annual production of 11 million tonnes of coal products with 8.5 million tonnes of metallurgical coal and 2.5 million tonnes of thermal coal.

Mr Roger Agnelli CEO of CVRD said "This is an important step in our strategy for the coal business. We still need to reach an agreement, which is in the final stage of discussion, involving competitive costs for the logistics of the project. I would like to highlight the support and partnership developed with the government of Mozambique, which were very important for the smooth evolution of this process. I am very happy with it."