Dangote Cement Company has been handed a 10-square-kilometre plot of land to mine coal, by the government of Tanzania.
The plot of land, is in addition to the $500 million cement factory set up in 2015 by Aliko Dangote.
The plot of land is situated in the southeastern town of Mtwara.
Tanzania’s Ministry of Energy and Minerals at the said weekend the factory has an annual capacity of 3 million tonnes.
According to local media, the coal concession 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.
Dangote 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 Nigerian billionaire and the company’s 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.