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ICVL’s Benga mine to re-start operations shortly

17 Mar 2016

ICVL Mozambique, which had suspended production at its mine in Benga recently, is expected to re-start the same soon, an official from the Steel Authority of India Ltd (SAIL), the main promoter of ICVL, told ICMW.

“Production has been suspended only for some time. It will resume soon,” the official said when asked if ICVL has suspended coal production.

“The mine is not closed as they have only suspended operation pending finalisation of some contracts for mining with another company,” the official added.

“Coal from ICVL is still arriving. In between, there were some issues for some time, but coal is coming on a regular basis,” the official said.

Media reports had said at the beginning of the month that ICVL had suspended operations at its Benga mine after failing to renegotiate a contract mining deal.

The current contractor’s term ended in December 2015.

Coking coal from the Benga mines is transported to SAIL in India.

ICMW had reported recently that ICVL is planning to cut its coking coal production by 65% to 0.40 million tons (mt) in 2016 compared to 1.14 mt produced in 2015.

The company will, however, consider increasing production if coking coal prices firmed up to around $100 levels from current level of around $79 per ton FOB Australia.

ICVL received an average price for its January coking coal shipments at $63 per ton, far below the needed break-even of $80 per ton, according to Inside Coal.