Indian group JSW Steel (NSE:JSWSTEEL) started developing a coal mine in Mozambique on March 13, some two years after it acquired 92% in the asset for $74mn.
First phase development of the Minas de Revuboe Mine (MdR), which holds about 850mn tonnes of reserves, is set to take about two and a half years to complete and, thereafter, produce 2.4mn tonnes of coal yearly, The Telegraph wrote on March 15.
In total, the mine has the potential to produce 250 tonnes of the product, which would be shipped to India to support JSW Steel’s steel-manufacturing.
“As the company plans to increase its annual steelmaking capacity to 50mn tonnes in India by 2030, the asset will help secure and diversify raw-material supplies while cushioning JSW from volatile global coking coal prices,” Parth Jindal of JSW Group said in a statement to The Telegraph.
Mozambican President Daniel Chapo and Jindal were among the high-profile guests at the inauguration ceremony at the mine site in northwestern Mozambique.
Five public sector companies operate a coal asset through joint venture outfit International Coal Ventures Ltd (ICVL) in Mozambique, in addition to Vulcan International, which owns Mozambique’s largest coal mine at Moatize that lies adjacent to MdR’s licence
“This project marks a pivotal milestone in securing premium hard coking coal reserves in Africa, strategically positioned close to India for cost optimisation,” Jindal said, per Forbes on March 16.
“We hope that this asset will provide strategic and diversified raw material security and cushion JSW Steel against volatile global coking coal prices.”
The Telegraph quoted Chapo as saying in a separate release:
“With JSW Steel’s presence, Mozambique will prove to international investors the ease of doing business in Mozambique.”
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