India’s Jindal Group will acquire, through subsidiary Vulcan Minerals, Vale’s main assets in Mozambique, namely Moatize coal mine and the Nacala Logistics Corridor (NLC) for a total of USD 270 million.
In a statement, Vale said it is committed to working together with both the Mozambique and Malawi governments to ensure a smooth transition to the new operator. The Jindal Group has rich experience working in Mozambique with its Chirodzi mine operations, located in the Tete Basin in the African country.
“I am pleased to announce this important step for the responsible divestment of Moatize and NLC, in a transaction that benefits the communities and governments where those operations are located and offering a sustainable future for the operations. This is another accomplishment on our commitment to reshape our company, focusing on our core businesses,” said Eduardo Bartolomeo, Vale CEO.
Other than the USD 270 million price, Jindal will pay a 10-year Royalty Agreement subject to certain mine production and coal price conditions. The Closing of the transaction is subject to the satisfaction of customary conditions precedent, including the approval of the Ministry of Mineral Resources and Energy of Mozambique and the approval of the Government of Mozambique pursuant to the Concession Agreements for the change of control and antitrust.
In early 2021, Vale announced its objective to no longer own coal assets, focusing on its core businesses and on its ambition to become a leader in low-carbon mining. While conducting a responsible search process for an investor in the coal business, Vale continued to support the project’s ramp-up and its commitments to society and stakeholders.
Over the past 15 years, Vale has worked in partnership with Mozambique and Malawi governments in the implementation of the Moatize mine and NLC’s 912 km railway for coal transportation, in addition to the revamp of general cargo operations and passengers transportation.