Friday, September 14, 2018

‘Caspian not seeking to control Tancoal’

 

Dar es Salaam. Caspian, a local mining contractor, has denied claims that it seeks to control Tancoal Energy Limited. A source within Caspian told The Citizen this week that the company only wants an administrator to be appointed to manage Tancoal, which is not the same as seeking control of the coal mining firm.

On Monday Intra Energy Tanzania Corporation (IETL), which is the parent company of Tancoal, issued a statement revealing that Caspian has gone to court to seek the appointment of an administrator after Tancoal failed to pay Caspian billions of shillings in a contractual dispute. The legal dispute is in the Commercial Division of the High Court and is set for hearing later this month.

“It is true that we have gone to court to seek the appointment of an administrator to manage Tancoal because we believe the company has failed to pay our debts due to mismanagement. We do not seek control,” the source said.

The fact that we have proposed the name of the administrator does not mean that we want to manage it. In March 2017 the two companies had entered a machine lease agreement in which Caspian was to provide Tancoal with mining equipment. But Tancoal has failed to pay Caspian about $6.2 million (more than Sh13 billion).

Intra Energy, which is listed on the Australian Stock Exchange, owns 70 per cent of shares in Tancoal, while the government of Tanzania, through the National Development Corporation (NDC), owns the remaining 30 per cent. The decision to contract Caspian came after a government order that coal production should be improved to meet rising demands.

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