Riversdale Mining Limited

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Riversdale Mining Limited has two top deposits “under one roof”.

This major announcement is the result of dedi­cated work by the Riversdale team. IRJ spoke with Steven Mallyon, Riversdale Managing Director, to get this exciting story straight from the source.

Mr. Mallyon is a long-term player in the mining industry. Starting out in construction materials, he moved into the mining sector in the 80s. He has over 20 years experience in the natural resources and construction material sectors, in senior ex­ecutive roles and mining experience in Australia, Africa, South America as well as emerging mar­kets in Asia. Mallyon recalls when fortune initially brought him to Riversdale in 2004.

“I was involved in the generation of capi­tal for Riversdale in 2004, and it was one of those rare companies that had very motivated management and was able to get things done quickly.” When the opportunity came along in August, 2008, for Mallyon to run the business, “it was something that I was more than pre­pared to do,” he says.

According to Mallyon, Riversdale’s growth strat­egy centres around the acquisition of upgrading assets where possible and conducting exceptional exploration where not. In respect to the Benga project, Mallyon says they were presented with “massive” coal resource. The Benga project is an open pit coal project in the Moatize basin of Mo­zambique. The Moatize basin area has been de­scribed as one of the largest undeveloped coking coal regions left in the world, with the potential to become a world-class coal hub in the medium to long term.

“We’ve been very focused on the Benga Coal Project. Our efforts have gone into getting that project through the feasibility study to where it is today,” Mallyon says.

Riversdale initially started to drill the seven ten­ements that it acquired, one of which was substan­tial in size, at 25,000 hectares. The results pleased the Riversdale team. “The quality of the coal pro­vided the competitive edge we wanted,” Mallyon says.

The past 12 months have seen 120 drilled holes and 40,000 metres of explored ground.

“The conditions for mining are ideal. It’s very flat, very close to infrastructure, and it helps that there is an international airport on the lease. There are several roads surrounding the project, also, which is a great advantage for us,” Mallyon says.

The fruits of those labours will blossom soon enough: Riversdale’s first-phase exporting is planned to start in 2010.

Sustainability in the community
Riversdale is acutely aware of the impact the com­pany’s mining could potentially have on the sur­rounding communities and has integrated sustain­ability initiatives into the project from day one.

“The first investment, apart from the drilling, was to build a training centre because we knew one day we will need people on the project to operate the machinery, the environmental systems there, do all of the accounting and the rest,” Says Mallyon.

“For us, it’s a combination of the external tech­nology and local capability that has really pushed Riversdale to where it is today.”

Once the training centre was complete the com­pany offered basic training to the community. “Our view on commitment to the country has been to employ locally. At the moment, we have about 150 employees in Mozambique, 90 per cent of which are locals,” Mallyon explains.

Riversdale has also introduced a number of pro­grams focused on health education—a paramount subject of concern for the region—including a ma­laria prevention program and AIDS awareness and prevention. A mobile clinic has been built for locals to use for health questions and treatments.

The overall goal of the company is to develop African projects with the first world benefits of the parent company. “We must achieve what is set out in the United Nations millennium goals, par­ticularly with respect to empowerment, elimina­tion of poverty, elimination of child malnutrition and health issues,” Mallyon says. A “concentric circle method” has been implemented in the zone around their exploration and construction camp where malaria has been eradicated using chemi­cal spraying, education and issuing mosquito nets.  “Our plan is to expand that concentric circle to en­compass the general community around our mine site, and beyond,” Mallyon says.

A look to the future
Through long-term planning and foresight sided by a commitment to work with and for the com­munities in which they work, Riversdale continues to impress with the Benga project. The company plans to ramp up production on the project by using the Zambezi river for barging and hopes for an increase from two to six million tonnes pro­duced per year. “Beyond that, our plan is ramp up river barging; the other is to access another rail line which is being built in Melaka, about 900 kilometres from the site. This is where it gets interesting because with the Zambezi project and Benga we believe that we will have the ability to produce between 30 and 40 million tonnes,” Mal­lyon says.

By reaching a target of 30 million tonnes in Mozambique, Riversdale will be posed to domi­nate the global seaborne anthracite coal trade and focus the coal market on Africa.  “The reason we want to do that is because some of the best markets in the world are within a few days feed­ing distance from our project, including India, Brazil and also Europe. They’re all much closer to Mozambique than to Australia,” Mallyon says.

The industry will keep an eagle-eye on Riv­ersdale and the Benga project leading up to pro­duction commencing in 2010, not least to covet this strategic partnership with Tata and excellent prospects set to come together. Mallyon looks forward to this juncture. “It’s highly unusual to see a tiny company like ours with two world-class coal projects under one roof. I think the endorse­ment of that strategy is probably best exempli­fied by Tata who has come in at an early stage, is extremely excited by the project and are also poised for growth. We’re a small company with very large projects and a very large partner and we look forward to growing with them” he says. “We’ve got a lot of work to do, but we have the team to do it.”