(Repeats story first published late Weds; no change to text)
* Mozambique says Rio open to dialogue
* Mozambique targets coal output of 100 million T by 2020
By Clara Ferreira-Marques
CAPE TOWN, Feb 6 Mozambique's mines minister is
confident of reaching a deal with Rio Tinto to solve the
miner's problem of transporting coal to ports, which contributed
to a recent $3 billion hit to its balance sheet.
Minister Esperança Bias said on the sidelines of a
conference in Cape Town that Rio was "open to continue working
with the government", brushing aside speculation the company
could simply pull the plug.
"Naturally we worry. But if you look at Rio Tinto's
problems, they were not just in Mozambique," she said.
"Mozambique was only part of the problem, and we believe we
can find a solution."
Rio last month sacked its chief executive and took a $14
billion writedown, including around $3 billion related to coal
assets in Mozambique, which it bought just two years ago in a
$4.2 billion deal.
Rio originally hoped to send coal down the Zambezi river by
barge, only to find its plans scuppered by the government. The
company said infrastructure had proved more challenging than
forecast and estimates of recoverable coking coal lower than
Rio's troubles have been seen as a cautionary tale for
miners considering major projects in countries with little or no
infrastructure, at a time when major producers also face
increasingly risk-averse investors.
Stretching along Africa's southeast coast, Mozambique holds
some of the largest untapped deposits of coking coal and is also
in a prime position to supply growing markets in Asia.
But infrastructure has proved a major challenge, and many
analysts say it could delay a long forecast coal boom. The
government is targeting coal production of 100 million tonnes in
the next decade, compared with exports estimated at just a
fraction of that last year.
"I believe that today (infrastructure) is a constraint, but
probably tomorrow it will not be," Bias said.
Rio's barge plan will not be approved because the Zambezi
river is not navigable, but a rail solution is viable, she said.
"Many studies have been done on navigability of Zambezi
river, and they advise it is not navigable," she said in an
"There are other alternatives that need to be explored, and
the most efficient is rail."
Local industry sources have said Rio initially wanted a
railway, which would be privately-owned and operated, a model
which has worked in Australia. This met with reluctance in
Mozambique, where the government has tried to keep
infrastructure in state hands.
The company is now considering options for a rail link open
to other users, possibly also outside mining.
"It is our strategy that transport links for any product
should allow free access for others. It makes no sense to
dedicate a line for one product," Bias said, adding that miners
active in the region should cooperate to find a solution.
"It makes complete sense that companies cooperate to find a
solution to export products."
(editing by Jane Baird)