Friday, May 20, 2016

Mchuchuma and Liganga projects ready for take-off

CONSTRUCTION of the 5trn/- Mchuchuma coal and Liganga iron ore projects in Mbeya Region is set to kick off this year, the Minister for Industries, Trade and Investment, Mr Charles Mwijage, told a press conference on Thursday in Dodoma. Minister Mwijage said already about 13bn/- has been set aside to compensate dwellers around the mining project area and soon after the exercise, the project will start in which iron ore and core plants will be set up. He said the projects would be implemented by Tanzania China International Mineral Resources Ltd (TCIMRL), which is a joint venture of the National Development Corporation (NDC) and a Chinese firm, Sichuan Hongda Group. About $3 billion will be spent on both projects. Minister Mwijage has said that the Chinese company has a startup capital of 600 billion US dollars and the debt finance will stand at 2.4 billion US dollars. Flanked by officials from NDC and the Chinese company, Minister Mwijage expressed confidence that the projects will be completed on time as their completion is expected to boost the local economy. 

Minister for Industries, Trade and Investment, Mr Charles Mwijage

According to the government, this investment will be the largest single industrial investment since Tanzania got independence in 1961. Minister Mwijage said the project will involve construction of iron plant with the capacity of producing one million tonnes per year and construction of a 600MW plant, of which 250 MW will be consumed by the iron plant and 350 MW will be fed into national grid. Such production will make Tanzania the third largest producer of iron in Africa. The two projects will create 32,000 jobs and generate about 3.13tri/- per year. According to Minister Mwijage, Tanzania’s stake in this project stands at 20 per cent, while the remaining 80 per cent is owned by the Chinese company. However, Mr Mwijage said it was the government’s commitment to increase its stake up to 49 per cent. Iron production is expected to lift the country to the middle income category and make realization of the 2025 Vision possible. Iron ore is a vital resource for steel manufacturing industries and other ferrous based industries. The explorations carried at the Mchuchuma Liganga projects have already confirmed that the coal and iron ore deposits will be mined for more than 100 years.

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