Rio suspends coal exports from Mozambique over threats

Diversified mining giant Rio Tinto  (LON, ASX, NYSE: RIO) suspended using the rail line that the company, Vale (NYSE:VALE) and other miners operating in Mozambique rely on to export coal, following rebels’ threats to sabotage the network.

“We have paused our operations on the rail line whilst we assess the current situation," said the company in a statement quoted by WSJ.com. However, the firm added operations at its Benga coal mine continue.

The opposition Renamo party, a former guerrilla group, was blamed for several attacks in the country’s central region that left two dead, after the group had threatened to disrupt the rail line and roads used to transport coal from the Tete province to the port of Beira.

This is not the first time Rio’s coal shipments come to a halt this year. In February the company also stopped freights from the coal-rich north-western province.

Brazilian Vale, the other main coal miner with presence in the African country, said in an e-mailed statement that the company continued to use the Sena line, but has heightened security.

"We are alert, observing the events, avoiding unnecessary exposure in zones of potential conflict and interacting with other companies looking to obtain the best information possible," it said.

Several reports yesterday suggested that Rio is considering a whole or partial sale of its troubled coal division in Mozambique.

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