The State-controlled Zimbabwe Mining Development Corporation is seeking US$23 million to resuscitate Elvington and ramp up production at Jena mines, and to spur exploration activities.
Most of ZMDC’s mines are operating at half their capacity due to capital constraints.
The corporation’s acting general manager, Mr Garikayi Chimhina, told The Sunday Mail Business last week that, “Inadequate capital injection has severely constrained exploration activities and ore reserve generation. This development has compromised on the flexibility in mineral extraction due to a subdued ore reserve position and low grades obtaining.”
But there is hope that ongoing negotiations with potential financiers will provide the resources needed for recapitalisation.
Jena Mines in Silobela, is negotiating for a US$7 million loan to ramp up production to 50kg per month by the end of next year from the current 15kg.
Another US$8 million is needed for “further exploration investigations and capital developments for productivity improvements and production sustenance”.
Capital constraints have seen average monthly production capacity diving from 40kg to about 15kg.
ZMDC says it needs funds for exploration, ore reserve generation and building of plant capacity to 1 000 tonnes per day, including revamping the mine haulages and shaft system to push production to 60kg per month.
Jena Mines’ investment case is strengthened by the fact that it holds 546 000 tonnes of ore at 4,2g of gold ore per tonne. With capacity to treat 450 tonnes of ore per day, Jena employed more than 632 people at its peak.
Similarly, Chegutu-based Elvington Mine – which collapsed in 2003 – needs an estimated US$8 million to reopen.
For 14 years, the mine has been intermittently treating sands as a stopgap measure to generate funds for care and maintenance.
Before its collapse, Elvington produced 45kg of gold per month. Now there are no underground mining operations and dump reprocessing operations are suspended.
Once investment is secured, there are plans to start dump treatment, open cast mining and underground mining.
The mine has 21 blocks of claims covering 437ha with potential monthly revenue of $2,4 million.
Sabi Gold Mine experienced a change in fortune in March this year when it re-opened after a $20 million injection from ZMDC partners, Chandiwana Mines.
Though Sabi is still under judicial management, it is producing about 20kg per month.
Separately, ZMDC also reported last week that headway had been made in resuscitating Kamativi Tin Mine in Matabeleland North.
Chinese investor Beijing Pinchang, which is set to pour US$100 million into the project, has completed confirmation drilling, while “consultants engaged are finalising on the report that will pave way for tin mining and other pegmatite associated minerals such as tantalite, beryllium and lithium”.
Kamativi was closed in 1994 after 58 years of operations due to falling tin prices on international markets.
ZMDC was established by an Act of Parliament in 1982 to strengthen Government’s hand in the extractive sector.
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