UPDATE 1-Nippon Steel gets nod to begin Mozambique coal project
TOKYO, April 4 (Reuters) - Nippon Steel & Sumitomo Metal Corp got the go ahead to start developing Mozambique's Revuboe coking coal mine, Japan's biggest steelmaker said on Thursday, a week after Anglo American dropped plans to buy a majority stake in the project.
Nippon Steel, which along with Nippon Steel Trading owns a third of the project, aims to start production from the mine located in Mozambique's promising Moatize coal basin in 2016, after gaining the mining license this week.
The mine is expected to produce five million tonnes of coking coal a year at full capacity, a level that Nippon Steel expects to reach by 2019.
Mozambique holds some of the largest untapped deposits of coking coal and is set to become a key source of the sought-after premium, hard grade that is used in making steel.
Last week, Anglo American abandoned a $555-million plan to buy a stake in the Revuboe project, in another sign of prudence by major miners chastised by investors for excessive spending and poor acquisitions.
A Nippon Steel executive told reporters in Tokyo that while the firm was open to joining other mining projects, it was not looking to lift its stake in the Revuboe mine, which is majority owned by the estate of deceased mining magnate Ken Talbot.
"At our core we are a steel company. If the majority owner does not have proper mining experience, this project loses its luster for us," said Shinichi Fujiwara, a managing executive officer at Nippon Steel & Sumitomo Metal.
Talbot, one of Australia's richest men and founder of Macarthur Coal, died in a plane crash in central Africa in 2010 and his estate has been for sale since.
South Korean steelmaker POSCO also owns shares in Revuboe, located in Tete Province.
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