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Rio Tinto in Mozambique withdraws expatriate families over safety

By Manuel Mucari
| www.cos-mag.com

MAPUTO (Reuters) — Mining company Rio Tinto is withdrawing expatriate employees' families from Mozambique for their safety in a sign that an upsurge in kidnappings and violence is worrying investors.

Other major companies developing big coal and gas reserves in the former Portuguese colony, Brazil's Vale, United States oil company Anadarko and Italian oil and gas group Eni, said they were closely following political developments there, after clashes between the government army and opposition Renamo guerrillas.

London-listed Rio Tinto, which mines and exports coal from northwest Tete province, said in a statement it was arranging to send home the families of foreign employees. It announced the move a day after tens of thousands of Mozambicans marched in the capital Maputo and two other cities

to protest against the threat of armed conflict and a recent spate of kidnappings by criminals.

"The safety of employees and their families is the number one priority," Rio Tinto Coal Mozambique said, calling this a temporary precaution.

Its coal operations, inclduing shipments, continue as planned, it said.

Seeking to reassure foreign investors and donors, President Armando Guebuza said this week he did not believe Mozambique ran the risk of sliding back into the kind of civil war that ravaged the country from independence in 1975 to 1992. That conflict, which killed up to one million Mozambicans, was fought between Renamo and Guebuza's Frelimo party.

Major coal, gas prospects

Armed partisans of Renamo opposition leader Afonso Dhlakama have carried out sporadic raids and ambushes since April and in the last two weeks have clashed with government troops in central Sofala province and in Nampula province in the north.

Vale, which is also mining coal in Tete, and Eni, which is exploring large untapped offshore gas deposits in Mozambique's Rovuma Basin, said they had no immediate plans to follow Rio Tinto's action.

"We do not currently see a risk to our staff but we are of course monitoring the situation," an Eni spokesman said. Vale's Project Director for Africa, Asia and Australia, Ricardo Saad, said: "We are operating normally. A spokesman for Anadarko, which has said it aims to ship the first cargo of liquefied natural gas (LNG) from Mozambique in 2018, said workers' safety was the company's "highest priority".

He declined to discuss company security matters. 

About 150 trillion cubic feet (tcf) of gas has been found off Mozambique's shores, enough to supply Germany, Britain, France and Italy for 15 years, and the government and companies scouting wells have estimated there may be potential to double that estimate.

But fears of instability have increased after government troops overran Renamo leader Dhlakama's jungle base camp in Sofala on Oct. 21, leading to a series of skirmishes and ambushes involving suspected Renamo guerrillas.

Dhlakama's former rebel group has lost successive elections to the ruling Frelimo party since 1992 and is demanding electoral reforms.

He is on the run from government troops in the remote Gorongosa mountains, several hundred kilometres (miles) north of the capital Maputo.

Renamo has said it will boycott Nov. 20 municipal elections because it considered the voting system biased. The United Nations, former colonial ruler Portugal, the Catholic Church and foreign donor governments including the United States have all called on Frelimo and Renamo to negotiate

their differences and avoid a return to war.

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