Mozambique: State to collect US$20M on sale of Vale assets

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Mozambique: State to collect US$20M on sale of Vale assets

7:39 CAT | 05 May 2022

FILE - Minister of Mineral Resources and Energy Carlos Zacarias. [File photo: Lusa]

Mozambique will receive US$20 million (€18.9 million) in capital gains from the sale of assets from Brazilian company Vale to India’s Vulcan, the Mozambican minister of mineral resources and energy said on Thursday in Maputo.

Carlos Zacarias, who was speaking at the end of a meeting between the Mozambican president, Filipe Nyusi, and representatives of Vulcan, said that the two companies and the Mozambique Tax Authority were in negotiations aimed at a definitive clarification of the amount payable to the Mozambican state for the deal.

“The Tax Authority, the seller and the buyer are in discussions to clarify the real amount to be paid,” he said.

As part of the operation, the Indian multinational will carry out investments in the mines and logistics component that it bought from Vale, also keeping jobs, he added.

The minister for mining resources and energy said that the likely destination of the coal to be extracted from the mines would be Vulcan’s steel factories in India.

At the end of April, Vale announced it had completed the sale of coal mining assets in Mozambique to India’s Vulcan Minerals, a deal worth US$270 million (€253 million).

“Vale concluded on 25 April 2022 the process of responsible transfer of the Moatize operation and the Nacala Logistics Corridor to Vulcan Resources, based on the binding asset sale agreement,” Vale Mozambique said in a statement to the media in December.

The mines are located in Tete province, central Mozambique, and, according to Vale, the transaction complied with the conditions set out by law.

Vale was in Mozambique for 15 years, having operated the Moatize mine and 912 kilometres of railway in the Nacala Logistics Corridor to transport coal.

At the beginning of 2021, the company announced its intention to “divest from its coal assets” and focus on “low carbon mining.

Source: Lusa