Beacon Hill Resources has shipped its first export cargo of Moatize thermal coal from Mozambique's port of Beira at the weekend, it said Monday in a statement to the London Alternative Investment Market. Beacon Hill's first export shipment comprised 10,650 mt of thermal coal that was trucked to Beira port from the company's Minas Moatize mine in Mozambique's Tete province and was loaded into the vessel MV Aztec Maiden. "The proof of concept of this initial economically viable shipment allows us to evaluate key elements in the supply chain, a process which will be highly beneficial to the group when we commence production of coking coal in Q1 2012," said Beacon Hill chairman Justin Lewis in the statement.
The London-listed coal producer said it was confident of attaining export capacity in Mozambique's Sena railway to Beira port in 2012, which would pave the way for its plan to upgrade production to 2 million mt/year of coking and thermal coal over the next two years.
The company did not disclose the thermal coal cargo's destination, though a possible market could be India, which like Mozambique borders the Indian Ocean.
In the meantime, Beacon Hill is to rely on trucks to transport 500,000 mt/year of its Moatize coal to port, which is more than adequate for the company's production in 2012. Beacon Hill said in its statement that it was having ongoing talks with the Mozambique government, which recently took over the operation of the Sena railway. The company, together with Brazilian miner Vale and Rio Tinto, which now owns Riversdale Mining, is finalizing terms of reference to upgrade the Sena railway to a capacity for coal exports of 6.5 million mt/year by the middle of next year, and to 12 million mt/year by the end of 2012. "Our export capacity will be significantly enhanced by the receipt of an allocation to the Sena rail line, in conjunction with its refurbishment next year," added Lewis.