Ngaka Coal Production Capacity Set to Increase

Tanzanian based coal exploration and development company Tancoal Energy is set to increase the production capacity at the Ngaka coalfield in southwestern Tanzania.

This follows Tancoal’s discussions with the cement industry and Tanzania’s Ministry of Energy and Minerals.

Following the discussions, customers have indicated that they will place orders of approximately 60,000 tons per month in 2017 as a result of the policy restricting imports of coal to Tanzania.

Tancoal has already achieved record coal sales in October and November 2016 thanks to the new policy.

In November 2016, coal sales amounted to 35,370 tons, an increase from the reported record achieved in October of 29,767 tons.

Consequently, Tancoal will increase its production capacity to have a stockpile and ongoing production available to meet the expected level of sales in 2017.

Tancoal is 70% owned by Australian mining company Intra Energy Corporation (ASX:IEC) and 30% by the National Development Corporation (NDC) of Tanzania.

In October 2016, hinese hydropower company Sinohydro Corporation signed Memorandum of Understanding (MoU) for joint development of 270MW Ngaka coal power station.

The Ngaka power station is expected to consume up to 1.2m t of coal per year from Tancoal, which has a coal resource of 423m t.

Upon completion, the power station will provide more than 15% of Tanzania’s current electricity generation needs through a 220kV transmission system.

Ngaka Coal Project

The Ngaka Coal Project is operated by Tancoal since 2011. The Ngaka basin comprises the Mbalawala sub-basin in the south and the Mbuyura-Mkapa sub-basin to the north.

Tancoal indicates that the Ngaka basin has the potential to host up to 1b t of high quality thermal coal.