Mumbai: Tata Steel and its Australian joint venture partner Riversdale Mining is acquiring full ownership of the $1-billion Benga power plant in Mozambique for an undisclosed amount. They are buying out Elgas’ 50% stake in Benga, which is expected to generate electricity in the next two years.
Riversdale, in which Tata Steel is the largest shareholder , said that moving to full control in the Benga power plant would accelerate the development of the project. It also would help in bringing in new strategic investors to the project.
Riversdale is subject to a takeover from Rio Tinto , which has offered $3.9 billion.
The coal-fired Benga power project is expected to produce 500 to 600 MW in the first phase and thereafter to 2,000 MW. After buying out Elgas in the Benga power project, the new shareholding pattern will be Tata Steel with a 35% and Riversdale with 65%.
Coal for the power plant will be provided from Riversdale’s coal mine, which is also in Benga. And the electricity generated from the power plant would be used to feed Riversdale’s Zambeze project and distribute it to South Africa’s power network.
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