Ronke Kehinde/
Dangote Cement Company in the southeastern town of Mtwara, Tanzania, is set to power the operations of the $500 million factory with coal.
The decision followed delay by Tanzania’s government to honour a 2016 deal to supply it with natural gas.
The government has now offered land to the company to mine coal for its operations.
Local newspaper, The Citizen, reported that Tanzania’s Ministry of Energy and Minerals, on Saturday, handed a 10-square-kilometre plot of land to the company, which was set up in 2015 with an annual capacity of 3 million tonnes.
The Citizen said the move was sanctioned by President John Magufuli to allow the company get a reliable supply of coal to fuel its activities.
Tanzania has banned the importation of coal from South Africa and Tancoal, the only one coal producing company in the country, cannot meet the entire market demand.
The company runs on expensive diesel generators and requested Tanzanian government support last year to supply natural gas at a reduced price.
President Magufuli later intervened after a meeting with the billionaire owner, Aliko Dangote, over stalled negotiations on prices.
He blamed middlemen for the delay in supply plans and said Dangote “will now buy natural gas directly from the state-run TPDC (Tanzania Petroleum Development Corporation)”.
Dangote, Africa’s biggest cement producer, is seeking to double Tanzania’s annual output of cement to 6 million tonnes.
The company plans to roll out plants across Africa.
0