Hwange Colliery Company (HCC) has clinched a $3,6 million coking coal export deal with India as part of the company’s export drive, it has been learnt.
Under the deal the first consignment of about 20 000 tonnes of coking coal is expected to be dispatched from Hwange to India before the end of the month.
The export drive is part of its turnaround strategy and a move to generate more foreign currency. In a statement on its website, HCC said this would be the first-ever consignment of coal to be moved by a Zimbabwean company to the Asian country targeting its vast steel-making industry.
“An average of 20 000 tonnes will be moved on a monthly basis during the first four months and will be increased to 50 000 tonnes per month thereafter,” Hwange Colliery said.
“The coal will be moved by rail through the Mozambican port of Maputo for onward transportation by sea to India.”
HCC said it was taking advantage of a serious coal shortage in India, which has a huge appetite due to its steel production and energy-generating plants.
“South Africa is already exporting large amounts of coal to India. India is now targeting the Zimbabwe and Mozambique coal. Southern Africa has the largest reserves of coal,” said HCC.
HCC currently exports coal and coke products to countries such as Democratic Republic of Congo, Zambia, Tanzania, Botswana and Mozambique.
In its financial results for the year ended December 2010 HCC’s headline earnings, the main gauge of profit, rose from $0,01 cents to $0,03 cents during the year ending December 2010 while turnover was up 47% to $99 million in the same period.
Coal production increased to 2,4 million tonnes compared to 1,6 million tonnes in 2009.
“The company is optimistic that its current funding initiatives will materialise during the year and that product demand will firm during the second half of the year,” the company said in its results.