Zimasco will invest an estimated US$80 million in new furnace smelting capacity in the medium-term as part of the mining giant's expansion plans, a company official has said.
Company spokesperson Clara Sadomba told businessdigest in the capital this week that Zimasco, which has an operational capacity of 180 000 metric tonnes per annum, is currently running at 80% of its operational capacity and is looking at doubling production to approximately 300 000 metric tonnes per annum.
The group, whose majority shareholder is Sinosteel Corporation of China, is currently running two furnaces at its Kwekwe-based plant while three other furnaces are on lease to a South African company, Portnex International, which is running two of the furnaces.
"We want to double our smelting capacity in the medium term. We are looking tentatively at an investment of around US$80 million to achieve this," she said.
Sadomba said the increased smelting capacity would result in increased mining output to provide the additional chrome ore feed for the new furnaces.
Zimbabwe hosts the world's second-largest reserves of chrome ore after South Africa.
"Our major shareholder, Sinosteel Corporation, is willing to provide us with both technical and financial support in line with our strategic objectives," Sadomba said.
Zimasco, which was under judicial management for 20 months and exited the arrangement on February 7 2018, said it has rearranged its capital structure and restructured debt repayments over four to five years.
"Zimasco has been reorganised and its debts restructured for payment over four to five years. The board and management of Zimasco have assumed full management control over its affairs and will be guided by the provisions of the Scheme of Arrangement sanctioned by the High Court of Zimbabwe," she said.
Sadomba said in 2018, ferrochrome production for Zimasco from its smelting and metal recovery operations is expected to be 120 000 metric tonnes while chrome ore production will be over 500 000 metric tonnes to cater for both beneficiation into ferrochrome and export as high grade chrome ore concentrate. She said Zimasco had signed a service level agreement with the NRZ and CFM in October 2017 for the transportation of its ferrochrome and chrome ore to the Mozambique ports of Beira and Maputo at a rate of approximately 60 000 metric tonnes per month.
Sadomba added that Zimasco intended to venture into the coal-bed methane business through exploration and development of special grants in Matabeleland North.
Sinosteel Corporation is already looking for a partner for technical support in this multi-million-dollar venture, the company said. Through its subsidiary, Shangani Energy Exploration (Pvt) Ltd, Zimasco holds coal-bed methane interests and is the biggest integrated ferrochrome producer in Zimbabwe.
One of China's leading steel traders, Zimasco's majority shareholder, Sinosteel Corporation, is a state-owned enterprise which, through its subsidiaries, develops, processes, and explores metallurgical mineral resources for steel mills. It also offers trading and logistics of metallurgical raw materials and products, related engineering technical services, and equipment manufacture activities, exploration and production of iron and chrome ores.
- the independent
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