Japan’s Mitsui & Co said on Thursday it has agreed to sell its stake in the Moatize coal mine and Nacala Corridor rail and port projects in Mozambique to Brazil’s Vale, the operator of the projects, for US$1 each.
The move comes as Vale, one of the world’s biggest iron ore miners, said separately it has decided to divest its coal business in a bid to focus on its core operations and in line with its aim of becoming carbon-neutral by 2050.
Mitsui said in a statement it plans to complete the transfer of the stake and associated loans to the Brazilian miner by the end of this year.
Vale will continue to operate the projects after the deal and will ultimately consider divestment of its interest to a third party, Mitsui said.
Also read: Vale Mozambique down US$277M in Q2
Mitsui has posted a series of impairment losses, totalling 46.7 billion yen (US$451M), on its Mozambique coal and infrastructure assets, taking the book value of its stake in the Moatize mine to zero. The Nacala transport corridor still has a book value of about US$500M, including its loans.
Mitsui said it is reviewing an anticipated loss from the sale. Any financial impact related to the projects was considered in its October earnings forecast for the current financial year to March 31, it added.
Source: Reuters via Club of Mozambique