In a move to secure raw material for its Corus facilities in UK and Europe and other global businesses, Tata Steel Ltd has entered into a Memorandum of Understanding (MoU) with Riversdale Mining Ltd, an Australian Stock Exchange listed company. Through this pact, the company will become a strategic investor in Riversdale’s Mozambique coal project by acquiring a 35 per cent stake for A$100 million (around Rs 345 crore).

The Mozambique coal project includes the coal tenements of premium hard coking coal in Benga and Tete, located in the Tete province in Mozambique, which are fully owned by Riversdale through its subsidiary.

The Benga and Tete tenements together cover an area of 24,960 hectares. “The Riversdale management expects that the potential mineralisation of the area will be substantially high,” it said.

The two companies are likely to develop the project. Riversdale is presently conducting a scoping study which is likely to be completed in August 2007. The definitive agreements are expected to be finalised and executed by November 30, 2007.

The hard coking coal derived from this project will be supplied to the Corus facilities in the UK and Europe and also to the company’s enhanced requirement in India in the future.

Said B Muthuraman, managing director, Tata Steel, “The MoU with Riversdale is in the Tata Steel’s stated strategy of progressing towards raw material security for its global business. This partnership gives Tata Steel an opportunity to jointly explore part of a large coal basin which could prove to be a potential source to meet part of the raw material requirement and enhance the long term competitiveness of the global operations.

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