‘US$12bn from mining is small change’

20 Oct, 2019 - 00:10 0 Views
‘US$12bn from mining is small change’

The Sunday Mail

Martin Kadzere

Zimbabwean miners have thrown their weight behind Government’s roadmap towards attaining a US$12 billion mining industry in the next three years, saying the targets were achievable, but implored the need to come up with a collective action plan.

Zimbabwe Chamber of Mines, a body that represents mining companies, told The Sunday Mail Business in an interview that local miners were ready to co-operate, given Government had shown the direction for the country’s mining sector.

On Monday, President Mnangagwa launched a strategic roadmap to propel the country’s mining sector to a US$12 billion mining industry by 2023.

Already, the mining sector is the largest foreign currency earner, accounting for 70 percent of export receipts.

The mining sector remains one of the key industries expected to anchor the revival of the economy suffering from depressed productivity, forex shortages among others.

Under the mining roadmap, gold is expected to contribute US$4 billion, platinum US$3 billion while chrome, iron, steel, diamonds and coal will contribute US$1 billion.

Lithium is expected to contribute US$500 million and $1,5 billion will come from other minerals.

Chamber of Mines Chief executive Mr Isaac Kwesu, said now that the Government had set the vision for the industry, there was need for collective efforts to come up with an action plan to ensure the set targets are achieved within time-lines.

Some of the gaps, which need to be urgently looked into include skills shortages, redesigning of the small-scale sector to ensure sustainable production of gold and chrome and Exploration Policy to allow the flow of funds into exploration.

This will help in making the targets more realistic since they will now be based on bankable mineral resource estimates generated by mineral resource accounting firms.

Boosting power production and enhancing bulk transport systems also remains critical.

“The three-year period is not too short (to achieve the targets), but it can be when we fail to address the fundamentals,” said Mr Kwesu.

“We need to address potential impediments; be it legislative gaps, issues to do with policy clarity, the Government creating an enabling environment and offering incentives to mining houses.”

Mr Kwesu said it is important that the Government has come up with a vision for the industry, which should help informing the miner’s strategic plans-in line with set targets.

“It’s positive that we have goals and objectives of the mining sector, which the Government desires. The shared vision is there; mutual understanding is there,” said Mr Kwesu.

Already, various new mining projects are at various stages of implementation while expansion of existing operations are underway. Given the abundant mineral resource in the country-untapped or under tapped, mining holds huge potential of transforming the country to an upper middle class, in line with Vision 2030.

In the chromite sector, Zimasco is building four new ferrochrome smelting complex with a capacity to produce 140 000 tonnes per annum. The smelting complex will be built at Neta in Mberengwa and is a joint venture with Afrochine Smelting.

The first furnace will be commissioned in 2021, followed by the commissioning of two furnaces in 2022 and the last in 2023.

Zimasco is also building sixth furnace at the Kwekwe smelter with capacity to produce 55 000 tonnes.

“We are quite confident that the sector targets set by the Government will be met,” Ms Clara Sadomba, the spokesperson for Zimasco, a unit of China’s Sinosteel said.

Karo Resources said it has completed phase one of exploration of its Mhondoro project, which the group said has “showed positive results apparent at this early stage.” The company is looking at producing 1,4 million tonnes of platinum group metals by 2023.

The US$4,2 billion platinum project, located in Mhondoro, is believed to have significant resources with potential to double current output from main three platinum mines, Zimplats, Mimosa and Unki mines.

Apart from platinum project, Karo is also developing a chrome mine along the Great Dyke.

The diamond production would be driven by four companies including Alrosa and Chinese-owned Anjin, to 11 million carats by 2023 from 3,2 million carats last year.

Anjin, which was kicked out from Chiadzwa diamond fields alongside a string of other producers in 2016, plans to resume mining soon while Russia’s Alrosa and the UK listed Vast Resources will start prospecting and mining diamonds in the Chiadzwa area.

Prospect Resources said it has achieved much progress on its Arcadia lithium project expected to come on-stream by mid next year. Studies have confirmed the project as highly profitable and would generate over US$3 billion in exports for Zimbabwe.

Coal Producers Association (CPA) said it was commendable that the Government has shown the direction “and should certainly have means to ensure the targets are achieved”.

According to industry players, two major coal projects would commence early next year.

“With new players coming on board, coupled with expansion of the existing operations, we are certainly confident that we will achieve our targets,” said CPA chairman Mr Ray Mutokonyi. Several other small to medium mining projects are also coming on stream.

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