Mining ZimbabweLatest Mining News, Policy and Industry Updates

OUTPUT from Zimbabwe’s gold mines firmed to 7,6 tonnes during the first quarter, driven by fresh investments into resuscitating idle assets, as big operators deepened shafts.

The sector produced four tonnes during the same period in 2021, according to market data.

But already, experts are seeing production gaining traction during the coming quarters, with output potentially hitting the 50-tonne mark by year end, from 29,6 tonnes last year.

Along with fresh investments, government chipped in with a string of intervention to bolster production in the past year, including setting up incentive schemes that defused the appetite to smuggle, according to Irvine Chinyenze, chief executive officer at the Gold Miners Association of Zimbabwe.

Firming international prices were also behind the rebound, experts said.

Chinyenze told this publication that miners benefited from Fidelity Printers and Refineries’ consistency in paying for gold delivered.

“We have a lot of investment going towards mining,” he said.

“Outside of manufacturing and probably agriculture, mining is the next best thing in terms of economic activity with very significant returns. We have seen quite a bit being done and being channelled into the mining sector. And obviously when that happens, the result is an upward trajectory. We have also seen consistency in terms of payments and the pricing regime at the refinery has improved, which is quite commendable,” Chinyenze told NewsDay Business.

Victoria Falls Stock Exchange listed resources giant, Caledonia Mining Corporation saw its output rise after completing a major shaft deepening project, while Padenga reopened a major operation in Mashonaland Central.

Chinyenze said that as a result of incentives and timely payments, the appetite to smuggle gold had fizzled.

“There is very little motivation to smuggle at present as far as small scale miners are concerned. Somebody can’t take risks to smuggle to South Africa, Zambia or any other nation. So this has been one of the major factors towards the deliveries that we are seeing. While prices are not at par with those obtaining on the world markets, they are significant enough to deter smuggling and improve deliveries,” Chinyenze said.

Economist Victor Bhoroma told this publication that higher output was underpinned by increased forex retention thresholds.

“The increase in gold production is largely to do with the gold incentive scheme (GIS), which allows producers to retain 100% of the export earnings,” Bhoroma said.

“Under the GIS, the RBZ allows some gold exporters to retain up to 100% of their gold earnings depending on their output. Under the arrangement, gold producers are also allowed to export their processed mineral equivalent to the incremental portion and secure loans for production. There is a lot of momentum due to firm world prices, government incentives and increased investment by large scale producers. Production will be between 45 and 50 tonnes this year,” he said.

Central bank chief John Mangudya early this year said Zimbabwe was targeting gold deliveries to rise to between 35 and 40 tonnes.

Gold is envisaged to rack in US$4 billion and expected to drive government’s ambitious plan of a US$12 billion mining industry by 2023. Output is envisaged to reach 100 tonnes in 2023.

Newsday

Arcadia lithium has officially been handed over to its new owners, Zhejiang Huayou Cobalt Co., Limited, a move that will catapult Zimbabwe’s bid to become a significant lithium concentrate producer in the world, while putting Zimbabwe on a strategic path in the promotion of the world’s new energy revolution.

Rudairo Mapuranga/ Prince Sunduzani

The Shanghai stock exchange-listed, new owners, have pledged to enhance their activities in the country in line with Zimbabwe’s drive to grow its mining economy significantly through enhanced production.

They have vowed to hit the ground running and are expecting to begin production soon, although no specific date was mentioned.

The company is eying becoming one of top tier players in lithium mining industry as the world is rapidly shifting towards clean energy.

As they take over, they have pledged to continue working with the people of Zimbabwe while developing sustainable livelihoods in their host country.

The signing was held on Wednesday and was graced by the Minister of, Mines and Mining Development Winston Chitando, and Company officials from both Prospect Resources and Hauyou.

Arcadia lithium mine is estimated to produce 300,000 – 500,000 tonnes per annum (tpa) of lithium concentrates during its mine life.

The company’s Excutive Vice Chairman George Fang said: “On December 22 last year, Huayou signed an agreement with Prospect to acquire the Arcadia project. After 4 months of joint efforts by the teams from China, Zimbabwe and Australia, the transaction has all conditions precedents satisfied or waved to close today. This is a gratifying, exciting and inspiring millstone. We are well aware that the closing of the transaction is inseparable from the hard work of Prospect and the great contributions of all of you. Thank you for your understanding, support and help in this journey so far.”

“Through you, Honourable Minister, please convey our heartfelt gratitude to His Excellency, The President of Zimbabwe, Dr E. D. Mnanqaqwa for his vision and leadership to transform Zimbabwe into a middle-income country by 2030.
Through this project, Honourable Minister, we are ready to contribute to the 12 billion dollars revenue by 2023.”

Commenting on the transaction, Prospect managing director and CEO Sam Hosack said: “Huayou’s pedigree as a leading electric vehicle battery precursor and cathode materials producer opens up opportunities in Zimbabwe and supports our strategy both in Zimbabwe and the broader sub-Saharan region.

“The transaction, being the culmination of years of effort progressing and developing the Arcadia Project to this point is a testament to the skills and expertise of the Prospect team, who are now firmly focused on the path ahead, to build the next iteration of Prospect, a developer of lithium and battery and electrification metals projects.”

In December 2021, Zhejiang agreed to purchase a 100 per cent stake in the Arcadia hard-rock lithium mine in Zimbabwe from Prospect Lithium Zimbabwe.
Located near Harare, the Arcadia project is considered one of the world’s biggest hard rock lithium resources.

Speaking to Mining Zimbabwe at the sidelines of the event Minister of Mines and Mining Development Winston Chitando said the government has blessed the takeover of Arcadia lithium by Zhejiang Huayou Cobalt which will see the mine increase production.

It came after gold deliveries   for the period under review jumped 92% to 7.695 tonnes from 4.016 tonnes in the comparable period.

The Reserve Bank of Zimbabwe (RBZ) governor John Mangudya told Business Times that the spike in international gold prices has pushed the export receipts for the country.

“If the current trend continues, the bullion is poised to reach impressive figures of above US$2bn by year end,” Mangudya said.

He said there was a combination of both good gold deliveries to Fidelity Printers and Refineries (FPR) and firming international prices.

The March 2022 gold output spiked 39% to 2.564 tonnes from 1.8 tonnes  achieved  during the comparable  period  following the 5% mining incentives put in place by the central bank.

FPR acting general manager Peter Magaramombe said the country should capitalise on international gold prices to ramp up production.

“There is a huge need to ramp up production following the firm commodity prices on the international market,” Magaramombe said.

Of the 7.695 tonnes delivered during the first quarter of 2022, small scale miners delivered 4.949 tonnes against 2.746 tonnes from large scale miners.

The Chamber of Mines of Zimbabwe  chief executive officer Isaac Kwesu  said various miners  were riding on the current strong mineral prices hence strong investments are needed.

“Miners should invest wisely on the proceeds of the good prices  that have  characterised the country’s  mining industry,” Kwesu said.

He said though the output is fairly good, there is still a long way to go to achieve an average of 8.3 tonnes per month to reach 100 tonnes a year.

Business Times