Announcement of Tanzania to Explore Coal Potential with IDA Credit on May 23, 1983

~ fOR IMMEDIATE RELEASE •World Bank (\ 1'818 H Street, N.W,, Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 IDA NEWS RELEASE NO. 83/87 Contact: Pushpa, Schwartz May 23, 1983 ( 292) 47 7-3294 ~ANZANIA TO EXPLORE COAL POTENTIAL WITH IDA CREDIT, In an effort to broaden its energy supply base, Tanzania will o undertake a project that will evaluate the potential of indigenous coal resources. The Interntional Development Association (ID.A), the Wo~;l'd Bank's affiliate for concessionary lending, will finance the project wit~/ an SDR 5. 9 million .{ $ 6. 3 million) credit. .\ ' The pr:.oj ect will provide extensive geological data on the Kabulo Ridge area in Tanzania's Songwe-Kiwira coal field and will help continue the exploration and delineation of reserves at the Ilima coal mine. It will also strengthen the technical and managerial capabilities in coal operations of the Mini~.try of MineraJs· and the State Mining Company, the two organizations implementing the project. • The exploration at the Kabulo Ridge is to establish the potential for economic open-pit mining. It will include drilling.of about 120 drillholes and additional geological and topographic mapping, test pitting, and bulk sampling. A feasibility study for open pit mining will be undertaken i,f warranted by the findings of the explorations and the demand prospects f,or coal at that time. Exploration work at the Ilima coal mine will involve drilling about 12 boreholes to determine whether there are additional reserves t,0: sustain continued production. Continued mining at Ilima will result in savings of about $3 million annually in foreign exchange which would otherwise be needed to import alternative fuels. The. project will also provide technical assistance through a coal mining advise,r and a financial management expert. Specialists in the Minis try of Minerals and the State Mining Compny will be furthe.:r trained to enable them to handle future mining operations. The IDA credit is for 50 years , including 10 years of gr ace; it carries no interest but has a small annual service charge ( 0. 5% on the undisbursed balances of the cr~dit and 0.75% on the disbursed balances.) NOTE: IDA credits are denominated in SDRs (Special Drawing Rights), • which are valued on the basis of a "basket" of currencies • The U.S. dollar equivalent of the SDR amount of the IDA credit reflects the exchange rates existing at the time of the negotia- tion of the credit.