Mining ZimbabweLatest Mining News, Policy and Industry Updates

Epiroc South Africa recently extended its longstanding agreement with Demolition and Drilling Equipment (DDE) in a bid to continue building on the partnership’s success in growing the Hydraulic Attachments market in South Africa and to further strengthen the service offering to customers.

Effective from October 2021, the extended agreement, which will be revisited in 2026, covers Epiroc’s complete Hydraulics Attachment (HAT) range: Rig-mounted hydraulic hammers, breakers, grabs, drum cutters, deconstruction equipment, spare parts, kits, consumables as well as ground engaging parts for all of the above.

DDE Director, Robin Jackson, says that the extended agreement will serve to reinforce and grow the relationship between the two companies. “Moreover, this latest agreement brings DDE closer on-board, helping to further bolster
customer focus, support, and response times for Epiroc’s Hydraulic Attachment range.”

“Looking from an inward perspective, our mandate is to sell products, remain market leaders in the mining and industrial space and grow market share in other segments where our products are used,” continues Jackson. “Outwardly we remain committed to improving existing customer relationships and to building new ones by always putting customers first.

Epiroc’s state-of-the-art equipment is amongst the best in the market and let us not forget that Epiroc invented the
hydraulic hammer. But while you can have the best product, you will never succeed if excellent after-sales service does not follow, an area I firmly believe DDE will add a lot of value going forward.”

The extension also provides certainty and therefore confidence in the additional investment DDE needs to make and indeed is already making to grow the Epiroc product within the company. Premises, equipment and personnel
complement are continuously reviewed and right-sized to meet product and customer demand. DDE have been renting out half its premises located in Jet Park, Boksburg, just behind Epiroc. As from 2022, DDE will now be taking over the entire premises in order to accommodate the increased Epiroc business, including new products, sales and especially service activity.

“In addition to doubling the existing Epiroc physical floor space, we are also adding additional sales and service resources which will help to increase focus on the Hydraulic Attachment product range.” Jackson adds that extra personnel will help to significantly add to the service and field support available to all customers, to meet their objective of growing the Hydraulic Attachment market in South Africa.

The expansion will also see re-equipping to adequately handle the full range of Epiroc Hydraulic Attachment equipment, including new products released by Epiroc globally. This will include the installation of new presses, cranes, forklifts, etc., some of which will come over from Epiroc.

“With previously all stock coming from Epiroc, probably the biggest recent change brought about by the Epiroc/DDE partnership extension is that we have begun importing directly from Epiroc’s Essen Distribution Centre in Germany,” says Jackson. With control of the logistics and forex and insight into data at the factory source enables the DDE team to provide more accurate order information and delivery times to customers.

Epiroc, always at the forefront of hydraulic attachment innovation, continues to release new updates, products and technologies, which will require retraining of DDE technicians. Furthermore, DDE also undertakes to collaborate with existing Epiroc partners so that they can seamlessly continue providing support to their loyal customer base. In order to provide more localised support, DDE is also establishing relationships with other partners and agents in other cities, mining areas and activity hotspots. This includes engaging with local community businesses in mining areas where community support is becoming an increasingly important socio-economic imperative.

Jackson concludes, “We believe that this new enhanced partnership agreement will drive good change to the South
African Epiroc market, to the benefit of both Epiroc and DDE customers. We undertake to directly and personally engage with all existing Epiroc customers, large and small, to keep them informed, a process that we will kick off at the beginning of 2022. It promises to be a very exciting year for us all!”

Kathryn Coetzer, Regional Indirect Sales Manager at Epiroc, says, “We have enjoyed a successful a long-standing
relationship with DDE and by continuing our partnership with them, we believe that we will see continued customer
satisfaction and value. The expansion of their workshop facilities is a large investment from their side, and evident of their continued commitment to better serving the Hydraulic Attachment customers throughout South Africa.”

CALEDONIA Mining Corporation, the parent company for Blanket Mine,is set to issue more shares in respect of its VFEX listing in order to raise more funds than originally anticipated following an extremely positive Zimbabwe investor response.

The VFEX is a subsidiary of the Zimbabwe Stock Exchange (ZSE), launched late last year as part of efforts to attract global capital, while also helping restore foreign investor confidence in Zimbabwe’s capital markets.

Caledonia which will be the third listing on the VFEX, joining SeedCo International and Padenga Holdings will list by way of introduction of Depository Receipts as Caledonia’s shares cannot be directly traded in Zimbabwe, due to some limitations on the New York Stock Exchange where they are also listed.

Curtis, Caledonia’s chief executive said at the offer price of US$12,64 per depositary receipt, Caledonia expects to issue up to approximately 630,000 new shares, raising approximately $7,96million (before expenses) and the proceeds of the offer will be used for general corporate purposes in Zimbabwe.

“The support from Zimbabwe investors has been extremely encouraging and reinforces our belief that this listing is an important milestone, welcoming new shareholders, with a mutual desire for investment in Zimbabwe and who have not, until now, been able to participate in Caledonia’s growth journey.

“The VFEX listing will also enable Caledonia to progress with its next phase of development.

The access to 100 percent USD revenue for incremental gold sales will assist Blanket, and any other new mine Caledonia develops and will attract investors who are confident that Zimbabwe is a competitive investment environment capable of delivering attractive returns.

“The anticipated listing highlights our continued commitment to Zimbabwe. We are excited about this next stage, and I would like to thank everybody for their continued support,” he said in a statement.

According to the company, one of the benefits of a listing of depositary receipts representing the Company’s shares on the Victoria Falls Stock Exchange (“VFEX”) in Zimbabwe is an improvement in the proportion of the revenues received in US dollars for gold produced at the Company’s majority-owned Blanket Mine and the Company looks
forward to benefiting from the development going forward.

Curtis noted that Caledonia will announce the exact number of new shares, and depositary receipts, to be issued once subscription monies have been deposited and formalities have been completed in the next few days.

He added that once the securities are issued, the Company’s depositary in Zimbabwe will liaise with the VFEX to have the depositary receipts admitted to electronic trading in Zimbabwe and dealings will commence.

“The listing and dealings are expected to occur on or about December 2, 2021,” said Curtis

Business Weekly

The resource extraction sector is confident of attaining the 2022 growth projections of 8 percent as long as Government provides major enablers and immediately resolve matters that weigh down on the miners’ performance.

The sector is estimated to grow 3,4 percent in 2021, before reaching a peak of 8 percent in 2022 as it moves towards attaining the US$12 billion mining industry target for 2023.

In the 2022 National Budget, the Mines and Mining Development Ministry was allocated $3 billion that will enable it to implement a number of programmes that will assist the mining sector to attain its desired growth by 2023.

Chamber of Mines Zimbabwe president, Colin Chibafa, said that the private sector is prepared to work closely with the Government to resolve all matters that weigh down the performance of the industry.

“With adequate support that meets the expectations of mining companies, the growth target of 8 percent is achievable.

“The mining industry is upbeat about prospects for 2022 and we hope that with the cordial working relationship with the Government, most key matters will be resolved and mining companies will be able to meet their production targets and support the attainment of the mining growth target,” he said.

Zimbabwe is targeting a fourfold increase in revenue from minerals by 2023, under the policy document, known as the Strategic Road to the Achievement of $12 billion by 2023, which will see gold exports at $4 billion and platinum at $3 billion.

Chibafa said that the Ministry of Mines and Mining Development requires support to meet most of the outstanding policy and legislative matters for the mining industry that will promote the attainment of the US$12 billion milestone by 2023.

“We feel the $3 billion (0.3 percent of total budget) may not be adequate, and the Ministry will remain underfunded to discharge its mandate,” he noted.

Chibafa indicated that the 2022 National Budget seeks to consolidate the economic recovery momentum experienced in 2021, while ramping up revenue collections through a raft of tax measures that seek to plug revenue leakages.

“We also see increased appetite to spend on agriculture, infrastructure and provision of social safety nets, anchored on deployment of SDR funds,” he said.

On the other hand, he highlighted that the mining industry had submitted proposals into the National Budget that related to fiscal support measures to unlock the full potential of the mining industry to enable the sector to optimally contribute to the socio-economic development of the country.

He said only one of the sector player’s submissions clarifying the calculation of royalties for PGMs was incorporated.

“We are dissatisfied that key proposals including measures to improve availability of foreign currency to fund operations and expansion projects through allowing mining companies to pay taxes in local currency, the proposal for removal of beneficiation taxes on PGMs and Lithium to unlock investments in the sectors as well as bringing finality to the exemption of the mining sector from complying with the equity thresholds of Indigenisation Act were not accommodated in the National Budget.

“We will continue engaging the Government on these matters and we are grateful that both parties seem to be converging in terms of understanding of the principles around these matters,” Chibafa said, adding that these matters need to receive attention urgently.

Chibafa said that given the pricing distortions in the market, miners are being penalised through an effective 20 percent tax on their export proceeds since they are supposed to surrender 40 percent of their export receipts at the official exchange rate yet these proceeds only have 50 percent purchasing power.

“Government itself does not accept miners to utilise these ZWL proceeds to pay taxes!

Therefore, in effect, these ZWL proceeds from surrender have limited usage and value. This is not sustainable. We hope that the Monetary Policy Statement will close the policy gaps and provide the necessary support to the   productive sectors so that they anchor economic recovery,” he said.

Through the 2023 mining sector vision policy document, the government is focusing on “value addition, enhanced investment within the sector, increased productivity and employment creation and increased exports and foreign-currency generation.

Private sector is expected to play a big role in the attainment of the envisaged growth while the government will facilitate the ease of doing business to encourage investments in the sector.

Business Weekly

FORMER Zimbabwe Iron and Steel Company (Ziscosteel) employees are demanding that their pensions be paid in United States Dollars since they made pension contributions in that currency.

Ziscosteel stopped production at its Redcliff plant over a decade ago at its Redcliff plant.

Its closure workers stranded and without terminal benefits.

Their representative Benedict Moyo, who also sits of the Ziscosteel pensions board of trustees said: “Ziscosteel retrenched it’s entire group employees on 31 August 2016. Pension payouts rules say that once one is terminated, resigns etc, then one must be paid out their pension within three months,” Moyo said.

“Zisco employees contributed to the pension scheme using US Dollars. On retrenchment, the government of Zimbabwe took over the company’s debt through the Zisco Debt Assumption Act while the Zisco pension fund is administered by First Mutual Life who took it from Old Mutual,” Moyo explained.

“A verification exercise was done by FML on individual’s payout. Government then passed a law saying that the Zimbabwean is rated to the US Dollar on 1:1 in 2019 through a Statutory Instrument. Afterwards, the government delayed the payouts until today,” he said.

He said the board of trustees (BOT) for the former employees does not agree with the 1:1 arrangement.

“As BOT of the Zisco Pension Scheme, we do not agree with the position of paying out at 1:1. The government must have a heart for its citizens by paying out in the currency that the former employees contributed or at worst payout at interbank rate. It’s not a secret that our currency’s value has been eroded. We have put our grievance to ministry of Finance and the Pensions and Insurance Commission so that the plight of former Zisco employees is attended to before the inhumane proposed payouts,” Moyo said.

NewZimbabwe

CALEDONIA Mining Corporation yesterday increased its target of funds for a planned listing on the Victoria Falls Stock Exchange (VFEX) to US$8 million after a positive response from Zimbabwean investors, chief executive officer Steve Curtis has said.

The firm, which holds majority control in Blanket Mine, will list on December 2, 2021.

In a shareholder update, Curtis said massive interest had boosted his board’s belief that joining southern Africa’s newest exchange would produce a range of positive spin-offs.

However, Curtis yesterday said an additional US$3 million would be raised.

“Caledonia is delighted to announce that in respect of its Victoria Falls Stock Exchange listing, due to extremely positive Zimbabwe investor response, Caledonia has decided to raise more funds than originally anticipated and, therefore, to issue more shares,” Curtis said in market update.

“At the offer price of US$12,64 per depositary receipt, Caledonia expects to issue approximately 630 000 new shares, raising approximately US$7,96 million (before expenses).

“The proceeds of the offer will be used for general corporate purposes in Zimbabwe,” he added.

The Jersey-headquartered outfit hopes to leverage on the forex-indexed VFEX to raise funding for its ambitious expansion in Zimbabwe, where it has set sights on purchasing new goldfields, after expanding production at Blanket Mine.

“The support from Zimbabwe investors has been extremely encouraging and reinforces our belief that this listing is an important milestone, welcoming new shareholders, with a mutual desire for investment in Zimbabwe and who have not, until now, been able to participate in Caledonia’s growth journey,” Curtis said.

“The VFEX listing will also enable Caledonia to progress with its next phase of development.

“The access to 100% USD revenue for incremental gold sales will assist Blanket Mine, and any other new mine Caledonia develops, and will attract investors who are confident that Zimbabwe is a competitive investment environment capable of delivering attractive returns.

“The anticipated listing highlights our continued commitment to Zimbabwe. We are excited about this next stage,” he added.

After enduring a listing drought since establishment in October last year, VFEX has recently been the subject of listing plans by several resource firms.

Last week, the Zimbabwe Stock Exchange-listed Bindura Nickel Corporation (BNC) said it would switch to the VFEX, giving impetus its growth ambitions.

The delisting, tentatively set for December 15 will bring to an end BNC’s 50-year relationship with the ZSE, having joined the bourse during the Rhodesian era in 1971.

BNC chairperson Muchadeyi Masunda sees the plan as a crucial step towards bolstering Zimbabwe’s plan to transform the mining industry into a US$12 billion economy by 2023.

Zimbabwe’s mines currently generate about US$3 billion annually.

The BNC boss spelt out his vision for the VFEX in papers sent to shareholders, rallying them to give the nod to the transaction during an extraordinary general meeting slated for December 13.

He said apart from its ability to raise foreign currency, special fiscal and monetary incentives extended to VFEX would unlock shareholder value.

“Your company is evaluating several projects which could be viable but would require substantial capital to be raised in foreign currency,” Masunda said.

Newsday

LARGE scale and mechanical alluvial/river bed mining in Zimbabwe has contributed to the degradation of an estimated 421.84 hectares of the riverine ecosystem, it has been revealed.

According to a survey that was done by the Environmental Management Agency (EMA) about 1 555 kilometres of river channels have been affected through water pollution and siltation.

EMA Environmental Education and Publicity Manager Ms Amukela Sidange said the practice of riverbed mining has been increasing over the years.

“Large scale and mechanical alluvial mining or riverbed mining are relatively an economic activity which spread in earnest from around 2011 across all the eight rural provinces of Zimbabwe, targeting mainly major rivers and their immediate tributaries. Such mining activities have gravely affected riverine ecosystems through water pollution, siltation, and degradation of approximately a total of 1 555km of the river channel; and disruption of
riverine ecosystem,” she said.

She said that has affected the capacity of the vital ecosystems to deliver goods and services in their best quantity and quality. Ms Sidange said the use of heavy equipment, such as dozers, tippers, excavators and front-end loaders in alluvial mining was resulting in several impacts to the immediate and downstream environment as well as the whole catchment landscape ecosystem.

“A recent survey carried out by EMA established that an estimated 421.84 hectares of riverine ecosystem has been degraded through alluvial mining or river bed mining in the country. The most affected major rivers include Mazowe, Umzingwane and Angwa, among others. Alluvial mining in Zimbabwe is prohibited according to Statutory Instrument 104 of 2021, except under certain specific conditions,” she said.

She said alluvial mining can only be done under written authorisation by the Minister of Environment, Climate, Tourism and Hospitality Industry; and submission of the Environmental Impact Assessments (EIA) reports for review in terms of Section 97 of the Environmental Management Act as read with Section 3(2) of Statutory Instrument 104 of 2021.

Such measures, she said, and numerous others are meant to protect the environment and prevent further pollution in line with the dictates of sustainable development.

“To ensure mining is done in a sustainable manner, rehabilitation, among other numerous abatement measures, have to be carried out in order to try and restore the mined areas to their original state and utilise the land for other productive activities.

She said this puts the land impacted by the mining activity back to a sustainable usable condition. EMA noted, in the survey on active and abandoned alluvial mining sites, that they needed to be rehabilitated owing to the extent of degradation that the areas had been exposed to.

EMA highlighted that rivers by their nature play a pivotal role in water provision, ecological integrity and community livelihoods, hence the Government intends to rollout a rehabilitation programme for Mazowe, Umzingwane, Manzimudaka, Angwa, Mutare, Nyamukwarara and Haroni Rivers degraded ecosystems.

“This is to impress on the criticality of rehabilitation and judicious protection of such areas to promote sustainable development. A call for interest to companies with capacity to rehabilitate degraded river ecosystems has since been made through media and the response  was overwhelming,” said Ms Sidange.

Due process is being undertaken to identify companies that have relevant expertise to champion rehabilitation of river ecosystems in Zimbabwe and restoration of ecosystems in line with the aspirations of National Development Strategy 1. EMA said rehabilitation was an expensive exercise, which can account for as much as over 10 percent of mining costs in certain circumstances, hence a clarion call to mainstream environmental protection in any form of development, as it is costly not to do so.

The Sunday News