Coal mining junior Coal Brick is looking at exploring the Zambian market, drawn by attractive prices and demand from expanding copper smelting companies in the country, the firm’s executive chairman said on Wednesday.
Coal Brick is one of several new entrants into the coal mining sector, having started operations in 2010, producing 500 000 tonnes of coal in its first year.
The firm is owned by a consortium of investors — Redmagic Holdings, Pan-African Energy, Liketh Union, Liketh Finance, Vulner Investments and Blackhealth Investments — all with a combined net asset value of $3,5 billion, according to Coal Brick’s website.
Industry players say the State’s Minerals Marketing Corporation of Zimbabwe applies a two-tier pricing system on coal, which puts the price at $180 per tonne when exporting to South Africa and $260 per tonne when exporting to the northern markets.
“This two-tier price system obviously has made us shift our focus to Zambia,” Coal Brick executive chairman Cephas Mandlenkosi Msipa said on Wednesday.
He said although the company has not mapped how much coal they wanted to export to Zambia, their preliminary study has shown that the country needed more than 30 000 tonnes of coal per day.
“That shows that is a huge market. In Ndola only there is huge appetite which local companies can exploit,” Msipa said.
He added that although South Arica was a huge market that is increasingly dependent on Sadc countries for its coal supply, transport costs were also a major problem.
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“Apart from the issue of pricing, transport costs to South are prohibitive as most mines are situated in the Hwange area which is nearer Zambia,” Msipa said.
– The Source
