Minister sketches iron ore project breakthrough

Dodoma. A Chinese company, Hongda Sichuan Limited will inject $300 million for commencement of the long awaited Mchuchuma and Liganga iron ore project.

The minister for Industries, Commerce and Investment, Mr Charles Mwijage, told reporters when introducing the investor here yesterday that implementation of the project which would also produce 600MW of electricity, will start in the next financial year.

“I have express directives from the prime Minister whom I have a short while ago  that I should stop doing all other things and make sure that I finish all the processes required for the kick off of this project,” said Mr Mwijage. o start with, the minister said, the investor has made available Sh13 billion for paying compensation to people who are supposed to shift to pave the way for the development of the project. “And we are not going to give them money only, we are also going to build new houses for them,” said Mr Mwijage.

Hongda Sichuan Ltd has entered into a joint venture with the government through the National Development Corporation (NDC) and formed a company called Tanzania China International Mineral Resource Limited (TCIMRL) in which NDC will hold 20 percent stake. “But we have freedom to raise our stake to 49 percent,” said Mr Mwijage noting that the government has got the 20 per cent without investing a single cent.

Some $24 billion is required to fully development the project which involve extraction of coal, iron ore and power production.

“I have seen a bank statement by this investor in which there is $600 million. He has agreed to initially make available $300 million and he is ready ot pay compensation amounting to Sh13 billion so as to enable him start the project immediately,” insisted Mr Mwijage.

He said the project would involve generation of 600MW of electricity our of which 250MW will be used at the mine for production of iron ore while the remaining 350MW will be pumped into the national grid.