Anglo abandons $555 million coal venture in Mozambique

Anglo American (LON:AAL) has decided not to proceed with the acquisition of a 58.9% interest in the $555 million Revuboe metallurgical coal project in Mozambique's coal-rich Tete province.

The transaction, announced in July last year, was subject to a number of conditions that, Anglo says, have not been satisfied.

The diversified miner expects to continue with its objective of establishing a position in the emerging metallurgical coal basin in Mozambique.

Anglo added it plans to continue with its objective of establishing a position in the emerging metallurgical coal basin in Mozambique.

The 1.4-billion-tonne prospect is a joint venture partnership and includes Nippon Steel Corp. (33.3% interest) and POSCO (7.8% interest).

Mozambique’s coal industry has faced a number of challenges in recent months.

Weather conditions forced the Sena railway, which links the mines in Tete province and the Port of Beira, to close in February, disrupting coal shipments.

Earlier this year Rio Tinto (LON, ASX:RIO) took a $3-billion writedown on its investments in the country as concerns over logistics grow.

Image by The Library of Congress