Bloomberg News

Rio Says Benga Coal Project Construction ‘Well Under Way’

September 01, 2011

(Updates with company’s comments in second paragraph.)

Sept. 1 (Bloomberg) -- Rio Tinto Group, the world’s second- largest mining company, said it is making progress on its Benga and Zambeze coal projects in Mozambique.

“Progress is being made on Benga, Zambeze and Tete East, with construction on the Benga project well under way,” David Joyce, managing director in charge of project expansion at the company’s iron ore unit, said at a presentation in Perth today. “We are working closely with the government to address infrastructure and national development priorities, which in turn will allow for timely completion and export of product.”

Rio joins Vale SA in expanding in Mozambique as coal prices climb. The London-based company may add 25 million metric tons of Mozambique coal to its annual output after completing its A$3.4 billion ($3.6 billion) acquisition of Riversdale Mining Ltd., which owns the mines, earlier this year.

Benga will ship about 5 million tons of unprocessed coal this year and may expand deliveries to 20 million tons, Riversdale Managing Director Steve Mallyon said on June 20. The adjacent Zambeze project may produce 42 million tons a year, rising to as much as 90 million tons of unprocessed coal, he said.

--With assistance from Soraya Permatasari in Melbourne. Editors: Ryan Woo, Paul Gordon.

To contact the Bloomberg News staff on this story: Jason Scott in Perth at jscott14@bloomberg.net

To contact the editor responsible for this story: Andrew Hobbs at ahobbs4@bloomberg.net.


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