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Bikita Minerals acquisition a game changer – Isaac Kwesu

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Bikita Minerals acquisition a game changer – Isaac Kwesu

The acquisition of one of the country’s oldest mines by Chinese-owned Sinomine Resource Group is a game changer towards the achievement of the US$12 Billion mining industry, the Chamber of Mines of Zimbabwe CEO Mr Isaac Kwesu has said.

Rudairo Mapuranga

China’s Sinomine said the company will invest US$200 million to build a plant and expand its existing mining operations as they seek to play a significant role in the achievement of the US$0.5 billion lithium industry by 2023.

According to Kwesu, the coming in of Sinomine at Bikita Minerals will benefit Zimbabwe in the achievement of the country’s lithium development as the mine according to President Mnangagwa has the potential to become a global kingpin in the Li-ion battery making industry.

“The coming in of Sinomine is a massively positive development to the community and country at large let alone our mining sector to achieve US$12 billion mark as announced by the government. The mining industry is very illuminated with this massive project. Lithium is key in the beneficiation and value addition goals of the country and it will go a long way in assuring that the mining value chain has strong linkages to the manufacturing sector when it comes to the role of lithium in battery making. The Sinomine project will go a long way in assuring that Zimbabwe achieves its social-economic development agenda for mining,” Kwesu said.

Wang Pingwei, director of Sinomine Group, said the company is poised to play a bigger role in the development of a lithium value addition in Zimbabwe.

“In order to promote resource value, generate tax income and bring employment opportunities for the local communities, Sinomine has decided to invest 200 million U.S. dollars in phase one to renovate the existing facilities and build a new processing line with a capacity of up to 2 million metric tons per year,” Wang said. “When fully operational, Bikita Minerals will achieve an annual income of approximately 600 million U.S. dollars, over 15 million U.S. dollars in taxes, and create more than 1,000 job opportunities.”

Vice President Retired General Constantino Chiwenga said the country should maximize its rich lithium deposits to position itself as a player in new technologies.

“The lithium subsector should prioritize the development of a lithium-ion battery value chain. This would accelerate Zimbabwe’s transition to clean energy while also ensuring the strategic position in the global lithium-ion battery markets,” he said.

Chiwenga said the lithium subsector gives numerous opportunities to explore, which would create jobs and generate income for the country.

Zimbabwe possesses Africa’s largest lithium reserves and the fifth-largest globally. The growing global demand for electric vehicles and renewable energy has seen Chinese and American companies investing in lithium mining in recent years.

Zimplow records growth across segments

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Zimplow records growth across segments

ZIMPLOW Holdings Limited (ZHL) recorded a 5% and 48% growth in revenue and profitability, respectively, in the first quarter as the company leans ‘pockets of opportunities in the market.

ZHL, a leading manufacturer and distributor of equipment in agriculture, mining, construction and power systems sectors, says despite foreign currency challenges in the first quarter it managed to take advantage of arising opportunities.

In its first-quarter trading update for the year, ZHL said it had experienced various problems due to the inflationary environment that rose 72,2% by the end of the period from 60,7% in December 2021.

“The group recorded a 5% and 48% growth in revenue and profitability in real terms respectively, despite the challenges obtaining in the domestic operating environment,” ZHL said.

“The board is encouraged by the resilient performance as Management continues to take advantage of pockets of opportunities in the market given the diversified structure of the group.”

ZHL said the first quarter of 2022 was characterised by foreign currency shortages culminating in exchange rate volatility and inflationary pressures, proving that the forex auction platform is moot.

Of all its segments, foreign currency shortages resulted in depressed volumes at ZHL’s earthmoving equipment subsidiary, Barzem, that was down 88% from the 2021 first quarter.

“The rate of inflation rose to 72.2% in March 2022 from 60.7% in December 2021. On the agricultural side, the softening of producer prices, together with the lower-than-expected rainfall for the 2021/22 season affected yields which gave rise to reduced disposal income by the farmer,” ZHL said.

“In addition, the Russia/Ukraine conflict continues to affect supply chains which in turn have resulted in a significant increase in input and operating costs, especially for those relying on fuel and fertilisers in their value chains. The power supply grid has been erratic, resulting in increased reliance on alternative power.”

For its agricultural segment, under its Farmec business unit, ZHL reported that the sale of tractors and implements volumes increased by 53% and 13% respectively. Meanwhile, parts sales and service capacity utilisation increased by 7% and 51%, respectively, against the comparative period.

ZHL’s Mealie Brand unit saw export implement volumes being up 26% in the period under review, from a 2021 comparative, despite local implements volumes dropping by 15% compared to last year.

The local business dropped to erratic rainfall and the hyperinflationary environment.

Under ZHL’s mining and infrastructure division, the CT Bolts division saw tonnage increase by 25% in fasteners sold, compared to the same period in the prior year.

In terms of ZHL’s Powermec subsidiary, a company that supplies agricultural equipment, national power cuts in the first quarter boosted sales.

“Volumes in gen-sets and solar equipment were 44% ahead of prior year whilst capacity utilisation increased by 71%. The top line improved by 230% in comparison to the same period in the prior year,” ZHL said.

Under ZHL’s logistics and automotive segment, its subsidiary, Scanlink, grew revenue by 64% in compared to the 2021 first quarter, on the back of a strong after-sales performance.

Meanwhile, Trentyre’s performance came at the back of significant supply chain realignments took a 14% drop in revenue as company recorded 21% growth in off the road tyres, lower than prior year performance for the commercial and consumer tyres.

“The steps taken by the Board which included the realignment of the Executive Management structure to Group strategy and the leveraging upon Group synergies has propelled the Group to a position of being a one stop shop for its customer base,” ZHL said, in an outlook.

“In addition, the new positioning in the earth moving market is expected to unlock the Group’s capability, infrastructure and expertise to deliver sustainable returns and fulfil value preservation objectives for all our stakeholders.”

Zimplats holds a safety symposium

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Zimplats holds a safety symposium

Zimplats held a safety symposium on the 16th of June 2022, for contractors who will be working with the company on various aspects of its $1.8bn expansion programme.

More than 160 participants representing over 70 contractors attended the symposium that was held at the company’s premises in Mhondoro- Ngezi. Zimplats is undertaking a US$1.8 billion expansion programme comprising nine projects which will be implemented over a 10-year period These include:

  • Development of Mupani mine to replace Rukodzi and Ngwarati mines at a cost of US$388 million.
  • Construction of a third Concentrator Plant at a cost of US$133million with nameplate capacity of 0.9Mtpa. Project is scheduled for commissioning in first-quarter FY2023
  • Implementation of the SMC concentrator tailings dam extension project to sustain the operation at the termination of the existing tailings storage facility (TSF) when it reaches its maximum design height of 43m.
  • Sulphur dioxide (SO2) emissions abatement (US$200m) and Smelter expansion (US$280m) projects at SMC
  • Platinum Group Metals (PGM) Base Metal refinery plant at SMC (US$200m)
  • Implementation of employee houses project in Turf, an additional 1052 houses and 340 houses in Chegutu (for SMC employees) at a cost of US$20m
  • 110 MWAC Solar power plant (US$201m), investment in the development of a 185MW solar photovoltaic plant
  • Hartley mine development (US$289m), to increase overall Zimplats ore production to 8.8Mtpa by FY2028.
  • Bimha mine upgrade (US$82m).

Zimplats believes that safety is of paramount importance in the rollout of these projects and that it is imperative to the attainment of sustainable business.

The expansion programme will bring together a significant number of contractors. Zimplats currently has nearly 7000 employees working at both the company’s Ngezi and Selous sites. Three thousand and five hundred of these are contract employees and the numbers are expected to double over the next five years.

Participants at the symposium were encouraged to invest in recognised systems, cultivating safe employee behaviour and creating a workplace environment that promotes safety.

Speaking at the symposium, the Managing Director for Zimplats, Mr Stanley Segula said, ‘as you bring together diverse business and safety cultures, there is need to align and ensure a common vision in the quest for zero harm.  We have embarked on a journey that will create measurable value for our stakeholders and on our country’s economy. We cannot travel this journey alone; we need to carry all our key stakeholders, including contractors, on board with us” as we seek to create a better future through the metals we produce and the way in which we do business.

He paid tribute to all the contractor company CEOs, M.D’s and senior management who attended the symposium, stating that,” for safety systems to work optimally and for zero harm to be achievable, company leaders need to be the drivers.  If all contractors working with Zimplats are committed to the safety agenda, we can deliver the various projects ahead of us safely..

Responding to the various presentations, a contractor representative commented, ‘Zero harm can be achieved by carrying out all risk assessments on all tasks and adhering to set standards and procedures. It’s about commitment and perseverance.”

At the end of the symposium, all the contractor companies signed a pledge committing to lead by example in cultivating a safe production culture, promoting values of respect, care and delivery, and supporting the quest for sustainable zero harm whilst subscribing to the various quality systems that are the bedrock of Zimplats’ operations.  The leaders also committed to enforce zero tolerance for any breaches of standards and procedures.

Bikita Minerals key in global battery industry revolution

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Bikita Minerals key in global battery industry revolution
Lithium-producer, Bikita Minerals has the potential to emerge as a key player in the rise and popularity of the battery manufacturing industry, President Emmerson Mnangagwa has hinted.
Rudairo Mapuranga
The President speaking at the groundbreaking ceremony of the Bikita Minerals Spodumene project in Bikita, Masvingo yesterday, said the mine will establish itself as significant in the battery manufacturing sector.
“With its investment Bikita Minerals will emerge as a key player in the battery manufacturing industry as well as other industries along the value chain,” President Mnangagwa said.
China Sinomine Resource Group, the owners who early this year acquired the project will invest US$200 million to build a plant and expand its existing mining operations as they seek to play a significant role in the achievement of the US$0.5 billion lithium industry by 2023.
For years Bikita Minerals has played an important role in global lithium production and is ranked as the fifth biggest lithium producer.
According to the Minister of Mines and Mining Development Hon Winston Chitando, the emergency of Sinomine at Bikita has seen the mine proving to be very significant in the lithium industry.
“Since Sinomine acquisition of Bikita Minerals, the firm has invested further in lithium exploration right now they have 7 drill rigs which are working in the concession.
“Sinomine has taken efforts to optimize what is on the ground and right now we have exports permits of Bikita Minerals which amount to US$40 million more than doubting the highest peak produced by Bikita over the past 5 years,” Minister Chitando said.

The Growing Battle between Mining and Agriculture

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The Growing Battle between Mining and Agriculture

Mining often sets up a direct competition with small-scale agriculture for control of land.

“Si a la vida, no a la mina” (Yes to life, no to the mine) is a rallying cry heard across many parts of rural Latin America these days. Mining, as well as oil and gas extraction, has exploded across the region in the last decade, driven by high prices for gold and industrial metals like copper that are needed primarily to feed the Chinese economy. This boom has also been experienced in Africa and Asia, where governments have sought to exploit their resource endowments to drive development. Fragile states like Sudan, Burma and Afghanistan have also begun to develop their mining sectors. The expanding mining sector has contributed to strong economic growth in some countries but has also generated social conflicts in rural areas that must be urgently addressed.

The heart of the issue is that mining activity has come into direct competition with another predominant means of economic development in rural areas: small-scale agriculture. Tensions over control of land and, most importantly, water have led to community protests and violent conflict. Reconciling these two important development drivers has become a critical governance issue, particularly in the most fragile states where the conflicts between the two can often be seen most starkly.

In theory, both mining and agriculture can provide pathways out of poverty. The World Bank and development-focused academic researchers have emphasized the critical role of agriculture in promoting rural development. (Three-quarters of the world’s poor live in rural areas.) Agriculture provides direct benefits to those who engage in it. Farmers receive payments for crops they produce, which they can then use to invest in future production and to pay for their families’ basic needs. Mining can also play a role in promoting development, although more indirectly, by generating revenues for governments. Governments can use taxes and royalties paid by mining companies for infrastructure investments and other productive purposes. Mining companies also pay for community development programs, build schools and roads, and make other investments.

Unfortunately, the compatibility of these two development paths, which tend to take place in the same rural areas, is at best questionable. Mining generates significant “externalities,” e.g. water pollution, that can have a direct impact on agricultural production. These negative impacts can be permanent and render previously fertile agricultural land unusable. Mining also requires large amounts of land that could otherwise be used for agricultural production. This sets up a direct competition with small-scale agriculture for control and use of land. In some countries such as Ghana, farmers displaced by mining projects turn to small-scale mining as a replacement livelihood. This can perpetuate a cycle of poverty and conflict in which these farmers-turned-miners are forcibly evicted and beaten by police for coming onto land claimed by large-scale mining projects.

Mining companies argue that mining and agriculture are not necessarily incompatible. But there are few examples of where this has been the case, particularly in developing countries, where oversight of the mining industry is often very weak. Finding ways to reconcile these two economic activities is urgently needed to reduce conflicts and ensure that mining’s benefits contribute to long-term sustainable development in rural economies.

Governments and companies should take specific steps now to address this situation. First, the environmental impact assessment process for mining projects needs to be significantly strengthened and made more independent. At present, governments rely on information provided by companies, which is most often not reviewed by an independent third party. Companies thus have an incentive to downplay potential impacts of their operations on land and water in agricultural areas. In countries such as Peru, local agricultural communities’ lack of confidence in these environmental reviews contributes to anxieties about the impacts of mining, which in turn contributes to conflict. Additionally, mining is increasingly done in “clusters,” meaning several mines operate in the same geographic area in order to take advantage of shared infrastructure and processing facilities. The cumulative impacts on land and water of several mines operating in the same area have not been thoroughly examined. The use of what are known as “strategic” environmental impact assessments, which take into account these cumulative impacts, would be an important step to increasing communities’ confidence.

Improved planning on how land will be used is another crucial step that governments should take. Mining concessions are often awarded without consideration for impacts on agricultural production. Later this year Oxfam America will publish research that shows graphically how mining and oil concessions have expanded dramatically in recent years in agriculturally productive areas of Peru and Ghana. Zoning land for particular uses, e.g. mining or agriculture, would help reduce conflict by establishing clear rules for how land will be used. Greater dialogue between the mining and agricultural sectors would be helpful. In Peru recently, the mining and agriculture ministries have signed a cooperation agreement. This is potentially a positive, although overdue, step.

Reconciling mining with agriculture in developing countries, particularly in the most fragile states, won’t be easy. It may ultimately require the admission that the two simply are incompatible over the long-term in particular areas. What is clear is that these discussions are urgently needed now so that conflict and violence produced by the juxtaposition of these two sectors diminishes and that countries can benefit from both their above-and below-the-ground resources.

This post originally appeared on the blog of the US Institute of Peace’s International Network for Economics and Conflict.

Barloworld to independently distribute CAT products in Zim

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Barloworld to independently distribute CAT products in Zim

Barloworld Equipment UK Limited (Barloworld) announced that it would be independently distributing Caterpillar products in Zimbabwe, a week after Barzem Enterprises said its 70-year-old alliance with the technology dealer would be ending this October.

Barzem’s parent, Zimplow Holdings Limited, announced the end of the deal last week in financial statements for the year ended December 31, 2021.

Barloworld chief executive officer (CEO) Emmy Leeka yesterday said the company had taken the decision to manage CAT’s distributorship effective October 1, 2022.

“This is a result of our growth strategy, which has resulted in changes to our strategic direction and plans for business expansion in the area,” he said.

“The termination of the dealership agreement does not compromise our ability to deliver Caterpillar world-class solutions to our local customers. We want to assure our customers that they can continue to rely on our extensive experience in the mining and construction industry. Caterpillar equipment and services will still be made available in Zimbabwe with Barloworld as sole Caterpillar distributor of the brand. We will continue to be the country’s strategic partner in the growth and development initiatives of its key economic sectors.”

Barloworld Equipment is an earthmoving and energy supply organisation that has been operating for close to a century.

Last week, ZimpIow CEO Vimbayi Nyakudya told a local paper The Zimbabwe Independent that while Caterpillar’s decision would be a “setback”, the firm was ready to handle change.

“Its absence, effective 30 September 2022, will be a notable setback in the short-term,” Nyakudya said.

“However, we are confident of engaging an equally competitive original equipment manufacturer (OEM) in the mining and infrastructure equipment space. We look forward to finalising the on-boarding of a new (supplier) in the shortest possible time, in order to deliver a reliable, durable and cost-effective mining equipment solution to the Zimbabwean market post 30 September 2022,” the Zimplow CEO said.

Along with opportunities on the public space, demand has also been huge in the mining industry, where big players have been expanding operations, while a string of new operators have trooped in.

Caterpillar has been shifting strategy globally, including exiting from the coal and soft rock underground mining business to focus on other mining technology.

In a statement to its financial statements, Zimplow said: “Barzem will exit the Caterpillar distributorship on September 30 2022 given the changes in the strategic direction by both the supplier and Zimplow Group. One of the key strategic matters the group is currently seized with is the search for a new OEM of earthmoving equipment to replace the Caterpillar brand at the end of the Distributorship Agreement on 30 September 2022.”

Zimplow said Barzem’s volume sales of earthmoving equipment rose by 84% during the year ended December 31, 2021 tracking steeper demand in publicly fund road construction projects.

“The focus on production by major mining houses who use CAT surface mining and handling equipment resulted in increased fleet maintenance. Consequently, parts sales grew by 75% and hours sold by 65% against prior year performance,” Zimplow said.

Government developing mineral-based policies

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Government developing mineral-based policies

As the country envisions the mining industry to fetch an annual revenue of US$12 billion by 2023, the government has begun the process of developing mineral-based policies to reduce hurdles associated with bundling a number of minerals under one policy.

Rudairo Mapuranga

Speaking to Mining Zimbabwe, the Deputy Minister of Mines and Mining Development Eng Polite Kambamura confirmed that a process to develop mineral-based policies for all minerals found in Zimbabwe has begun with a lithium policy considered among the minerals to be first prioritized.

“The government has started developing mineral-based policies, each mineral is going to have a development-based policy with lithium, not an exception.  It’s a work in progress to have mineral development policies,” Kambamura said.

Last year, Gemstone Miners Association of Zimbabwe (GMAZ) an affiliate of Zimbabwe Miners Federation (ZMF) chairperson Mr Walter Kawara said mining policies are necessitating increased corruption in the mining, trading and export of coloured gemstones prompting experts to conclude that the lack of a policy specifically for the coloured gem industry was a cause for concern.

Kawara said the government was only paying attention to gold issues at a time when a lot of precious stones were being spirited away under its nose.

“There should be a specific policy which deals with gemstones, the precious minerals act does not deal with semi-precious stones,” Kawara said.

Zimbabwe is currently in the process of amending the Mines and Minerals Act, a process which will see small-scale and artisanal miners beginning to be considered miners different from large-scale producers who are often well-capitalized and heavily mechanized than small scale who use light equipment and lack significant capital and mining expertise.

The government is also currently amending the precious stone trade act, and the gold trade act, among other minerals-related acts for the growth, development and sustainability of the mining industry in Zimbabwe.

KPCS satisfied with Zim readiness, Kambamura

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KPCS satisfied with Zim readiness, Kambamura

The Kimberley Process Certification Scheme (KPCS) review team which visited the country last month to scrutinize the country’s diamond industry’s preparedness as Zimbabwe seeks to take over KP chairmanship next year has expressed satisfaction with the country’s level of compliance to best practice guidelines of mining and trading of gems.

Rudairo Mapuranga

In an interview with Mining Zimbabwe, the Deputy Minister of Mines and Mining Development Dr Polite Kambamura said that the KPCS review team saluted the government and diamond stakeholders for working in line with the best international standards.

The country’s last KPCS review was made in 2012 and the review last month was an opportunity for the diamond industry to showcase advances that have been made since then in terms of processes compliance.

“Last month we had a Kimberley Process Certification scheme inspectorate team which visited our country, they stayed here for about a week and they went around throughout the country to see our preparedness, our readiness in terms of compliance to the KPC standards.

“They went through to Chiyadzwa, they also visited some diamond mining assets such as Murowa diamonds and also visited our ports of entry and the MMCZ. In all these areas they were checking to see that the country adhered to set standards of the KP.

“After the review, we had a meeting with the visiting team and it expressed satisfaction with what they saw on the ground and we are looking forward to getting an official report from the team with regards to their findings. This is in preparation for Zimbabwe taking over the chairmanship of KPC come 2023 and also taking over the chairmanship of ADPA,”  Dr Kambamura said.

Zimbabwe, which was recently elected vice-chair of the Kimberley Process Certification Scheme (KPCS) for 2022 at the plenary meeting held in Moscow from November 8 to 12, 2021 will automatically take over the chair of the KPCS in 2023.

The Kimberley Process Certification Scheme is the core of the Kimberley Process, which is a multilateral trade regime established in 2003 by the United Nations General Council to prevent the flow of conflict diamonds. Under the KPCS, member states implement safeguards against shipments of rough diamonds and certify the diamonds as “conflict free”.

The KPCS works as a tripartite body with the current setup having: Industry (represented by the World Diamond Council; Civil society coalition; and Governments.

Some pertinent matters to note on Zimbabwe’s assumption of the vice-chair of the KPCS include the following:

Zimbabwe will immediately start preparations to take over the Chair and run the Secretariat in 2023; Preparations will also commence for the hosting of the two annual meetings of the KPCS in 2023, namely: the intercessional and plenary;

Establishment of a skeleton secretariat to start learning from other countries in hosting the Chairmanshipand Secretariat; Cognisant that Zimbabwe will take over the Chair in the year that the KPCS holds its review cycle, preparations in that regard will also commence.

US & partners enter pact to secure critical minerals like lithium

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US & partners enter pact to secure critical minerals like lithium

The United States, Canada and other countries have established a new partnership aimed at securing the supply of critical minerals, which are essential for clean energy and other technologies, as global demand for them rises, the State Department said on Tuesday.

Demand for the minerals, such as nickel, lithium and cobalt, is projected to expand significantly in the coming decades.

Massive amounts of these minerals will be needed to meet the United States’ emissions reduction goals, Jose Fernandez, undersecretary for economic growth, energy and the environment at the State Department, said in a telephone interview.

“You will need six times more lithium by 2050 than you use today in order to meet the clean energy goals,” Fernandez said, speaking from Toronto. Canada “is an important supplier of critical minerals,” he added.

The minerals are key inputs in batteries, electric vehicles, wind turbines, and solar panels, and are also used in products ranging from computers to household appliances.

The Minerals Security Partnership will aim to help “catalyze investment from governments and the private sector for strategic opportunities … that adhere to the highest environmental, social, and governance standards,” the State Department said in a statement.

The US government has been working with Canada to boost regional supply chains to counter China’s dominance in the sector.

Critical minerals are “a generational economic opportunity for Canada if we get it right,” Canada’s natural resources minister, Jonathan Wilkinson, said in a phone interview. He spoke at Toronto’s annual mining gathering, called the Prospectors & Developers Association of Canada conference.

Canada has large deposits of nickel and cobalt, while the United States does not, Wilkinson said.

The Minerals Security Partnership, in addition to Canada and the United States, includes Australia, Finland, France, Germany, Japan, South Korea, Sweden, the United Kingdom and the European Commission.

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Flooding erodes road to Sibanye’s Stillwater mine

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Flooding erodes road to Sibanye’s Stillwater mine

Precious metals miner Sibanye-Stillwater reported on Tuesday that all its employees at the Stillwater mine, in flood-hit Montana, were safe, but stated that roads and bridges leading to the mine had been damaged.

The region has experienced widespread floods since Monday after a warm spell led to a rapid melt of accumulated snow in the mountains and associated runoff, which was exacerbated by heavy rainfall over the weekend.

Sibanye said that its Stillwater mine had been most affected by the floods. The road between Nye and the mine had been eroded and several bridges in the region had been damaged.

“This is likely to restrict access to the Stillwater mine for some period that will be better known in the next few days,” the company said.

The East Boulder mine was less affected and access currently remained intact.

Sibanye said a full assessment of the regional impact of the floods and the impact on the operations would be undertaken once the floodwaters had subsided, likely in the next few days.

The Stillwater mine is currently supporting campers that are arriving from the nearby Woodbine campground.

According to the Stillwater county’s Department of Emergency Services Facebook page, emergency responders, along with the Stillwater mine, rescued 68 people from the Woodbine campground and surrounding area. Evacuees were ferried out of the area by raft.

Stillwater county states the flooding along the Stillwater and Yellowstone Rivers and Rosebud Creek was “unprecedented”.

Mining Weekly

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