Macuse re-emerges as new Mozambique coal export option

A 525 km railway to connect the port to coal mines in Tete Province is also planned, plus a shorter spur link to mines in Chitima.

Several years after the project was shelved, Thai Moçambique Logistica (TML) has revived its plan to build a new coal port at Macuse near the mouth of the River Zambezi in Mozambique.

Interest in the country’s coal industry seemed to have nosedived, with Vale the most recent to pull out, but Indian firms have continued to invest and TML seems committed to the sector’s long-term future.

Reports in Mozambique suggest that TML has already raised US$500M to start port construction in mid-2024. Two parcels of land totaling 5.3 square kilometers on either side of the river have been ringfenced for the project.

The recent announcement by no means guarantees that the project will actually be built. The government of Mozambique awarded TML a concession to build and operate the port and railway in 2013, at a time when the lack of transport capacity was holding back the expansion of the country’s nascent coal industry.

People living in the area were moved in anticipation of construction starting, but the project timetable has been postponed several times as international appetite for new sources of thermal coal became constrained in many markets.

TML has not commented on the type of coal it intends to handle but Mozambique has plenty of both coking and thermal coal.

The port, which would be located just north of Quelimane in Zambézia province, could also handle timber exports. Under the original agreement, the project was to have been operated by TML with a 60% stake, with 20% shares held by both Mozambique’s state-owned transport utility Portos e Caminhos de Ferro de Moçambique (CFM) and a Mozambican consortium named Corredor de Desenvolvimento Integrado do Zambeze (Codiza).

A 525 km railway to connect the port to coal mines in Tete Province is also planned, plus a shorter spur link to mines in Chitima. This would be a far shorter option for Chitima than the alternative port options of Beira or Nacala.

Mota Engil Mozambique and China Machinery Engineering Corporation were originally awarded contracts to build the railway. The line was to have initial transport capacity of 25 Mtpa with eventual capacity of 100 Mtpa mooted, according to the government.

Sinosure and Chinese banks were mooted as the source of most of the US$3.3 B funding needed for the port and railway but this figure has almost certainly increased over the past few years.