mozambi coal starts exploration near riverside

http://www.proactiveinvestors.com.au/companies/news/15977/mozambi-coal-commences-highly-anticipated-exploration-program-near-riversdale-mining-15977.html



Mozambi Coal (ASX: MOZ) is positioned to capitalise on the increasing demand for coal, with the company commencing an exploration program in the Zambeze basin in Mozambique, in one of the world?s largest undeveloped coal basins.

Drilling will initially focus on the Tete West project, with 2000 metres of HQ diamond drilling.

Ground verification and geological mapping has already indicated the potential for a coal-bearing Lower Karoo sedimentary package that hosts most of the expanding coal reserves in Mozambique.

Exploration will then move to Tete West for 1000 metres.
Shiv Madan, managing director of Mozambi, said, ?This is a great start for Mozambi.

"After completing the re-listing in March, management is very pleased to commence drilling within the planned time frame and we are looking forward to this exciting new chapter in our company?s short history as an explorer."
Further boosting the prospectivity for Mozambi in the basin, Riversdale Mining (ASX: RIV) has already identified 13 billion tonnes of coal.

The Riversdale projects include Zambeze, where 9 billion tonnes of coal has been identified over 22 coal seams, with an agreement in place for Wuhan Iron & Steel to acquire 40% of project for US$800 million.

At Benga, 4 billion tonnes have been identified with a mining contract granted by Mozambique government for a 20 million tonnes a year operation.

Vale (NYSE: VALE), owns the Moatize Project with a resource of 1.4 billion tonnes, and is set to commence production this year at a rate of 11 million tonnes per year of coking and thermal coal.
The Mozambi tenements
Mozambi has the right to earn a 70% interest in two licences covering an extensive 385 square kilometres.

One of Mozambi's licences is located 12 kilometres west of Tete and extends over 172 square kilometres. Tete is 1100 kilometres north of Maputo, the capital of Mozambique and is serviced by several airline flights daily.
Upgrades and refurbishments to port and rail infrastructure will enable capacity growth in the next 3 to 5 years. Road and other modern communications facilities have been upgraded and the Moatize to Beira railway has been recently re-commissioned by the Mozambique Government.

Not to be outdone by Riversdale in the potential scale of the its coal target, Mozambi has established an exploration target between 3.1 and 3.9 billion tonnes of coking and thermal coal.

Major shareholder support for Mozambi
Natural resource investment company Polo Resources (LON: POL, TSX: POL), run by Stephen Dattels, has a very bullish opinion of Mozambi.

Polo has been building a substantial stake in Mozambi, and acquired another 1.5 million shares last month on-market to now hold 12.51% of the highly prospective coal explorer.
Dattels has a solid understanding of African resources, and has made some substantial investments that have paid very high returns.

These include the sale of a holding in UraMin to Areva for $2.5 billion.

Polo is also a major investor in Caledon (ASX: CCD), and has been busy acquiring various coal interests worldwide.

About Mozambique
Mozambique is a stable multi party democracy with a developing resource sector, and hosts one of Africa?s fastest growing economies with GDP growth rates between 4.5% to 7.6% over the last few years.

This has been aided by investments from China, India, and Brazil, directed into resources and infrastructure projects.
The country also contains massive coal resources in the Zambeze Basin, which currently stand at over 17 billion tonnes, and hold significant potential for further resource upgrades.

This coal has been identified as premium hard coking coal that is the same quality as contained in the Bowen Basin of Queensland.

If Riversdale is any guide, evolving into a $5 billion valued company, Mozambi offers investors a exciting future with drilling commencing at Tete West.