Mining ZimbabweLatest Mining News, Policy and Industry Updates

Gold mining companies have asked Government to facilitate access to loans needed to increase production and ensure the country achieves its targeted 100-tonne output by 2030.

The metal is Zimbabwe’s second-biggest export earner after platinum.

Both gold and platinum generate more than half the country’s exports.

Mines and Mining Development Minister Winston Chitando told the Chamber of Mines of Zimbabwe (CoMZ) annual general meeting (AGM) in Victoria Falls on Friday that Government will be working on modalities for the requisite funds.

“. . . the Government’s strategy is to increase gold production to 100 tonnes by 2030. In pursuit of this, there has been an intervention to ensure that gold producers can access good loans,” he said.

“This is an issue which has been suggested, with a recommendation presented through the chamber, that to enable and facilitate attainment of the 100-tonnes target there is need to ensure gold players can access gold loans.”

An agreement on a strategy document to be drafted urgently detailing how Government will interface with the miner in facilitating gold financing options has since been reached.

A number of projects are currently underway in the sector.

Shamva Mines was officially launched last year, while Eureka, which closed in 2000, will resume operations in July.

Caledonia has invested US$60 million in deepening its shaft.

“Government is also working with investors so that we also capacitate small-scale gold mining companies through introduction of gold service centres and command mining structures,” added Minister Chitando.

Government’s triple-pronged mining strategy includes attracting new investment, increasing production at operating mines and reopening closed or dormant mines.

Sectoral targets for the mining industry are part of targeted milestones in the National Development Strategy (NDS1), which lays building blocks for Vision 2030, by which time Zimbabwe should be an upper middle-income country.

Platinum

According to Minister Chitando, there is a slew of greenfield projects for platinum group metals (PGMs) at various stages of development

The sector is presently dominated by three players — Mimosa, Unki and Zimplats.

“All three producers are in expansion mode while we will have new production from GDI (Great Dyke Investments) and Karo Resources, which will result in platinum contributing US$3,5 billion (by 2023),” he said.

PGM players have since agreed to engage a specialist to assist in the setting up of a platinum metals refinery to drive beneficiation. On its part, Government has asked producers to make a formal request to Government on the key enablers they require to build the PGMs refinery.

Overall, gold, ferrochrome and carbon steel production were expected to generate over US$1,5 billion by 2023.

A number of expansion projects, said Minister Chitando, were underway in the ferrochrome processing sector, including by ZimAlloys, which has since completed refurbishing its furnaces.

Expansion of ferrochrome is also underway at Zimasco and Jinan.

Chinese investors have completed a 150 000-tonne coke over battery at Dinson Colliery in Hwange.

Construction of a second battery with the same capacity has also begun.

Further, a multimillion-dollar carbon steel plant is in the pipeline.

Diamond

There has also been progress in the diamond sector, where Russian firm Alrosa is set to begin operations, while China’s Anjin will resume and increase production.

Zimbabwe Consolidated Diamond Company (ZCDC) is ramping up production, while at RioZim’s Murowa has invested US$450 million on expanding capacity.

This year’s CoMZ AGM was held under the theme “Navigating Turbulent Times and Sustaining Mining Industry Growth Amidst Covid-19”.

The meeting explored strategies to drive production, which dropped across most minerals in the first quarter of 2021.

President Mnangagwa was part of the high-profile delegates who graced the event.

Also present were Vice President Constantino Chiwenga, Finance and Economic Development Minister Professor Mthuli Ncube, as well as the Defence and War Veterans Affairs Minister Oppah Muchinguri-Kashiri.

The Sunday Mail

POSSESSION of copper cables without a valid licence will soon attract a mandatory 10-year prison sentence without the option of a fine, under new regulations meant to deter vandalism of key utilities.

The Copper Control Act is being amended to raise the minimum sentence for illegal possession of copper from the current two years.

The Copper Control Amendment Bill, which was gazetted on Friday, will make it mandatory for all copper dealers to have certificates of origin for all the metal in their possession, once passed.

“The vandalism of utilities through theft of copper cables has been exacerbated by the non-provision of specific offences in relation to these acts and non-deterrent penalties in the Copper Control Act,” reads the Bill in part.

“In order to address the foregoing, the Copper Control Act should be amended to make it mandatory for all copper dealers to have certificates of origin for all the copper in their possession and impose minimum mandatory penalties for offenders.”

The proposed amendments also provide for the forfeiture to the State of any vehicle or devices used to transport illegal copper upon conviction.

The Bill also imposes a 10-year prison sentence for vandalism or tampering with utilities through theft of copper cables.

“Clause 4 inserts a new section that makes it mandatory for all copper dealers to have a certificate of origin for all copper in their possession. This certificate of origin will include the names and addresses of both the seller and the purchaser, the description of copper, quantity, reasons for disposal.

“This section will further set a minimum mandatory sentence of ten (10) years without the option of a fine for failure to produce a certificate of origin.

“For security reasons the certificate must be endorsed by the police in the prescribed form and manner to be provided by the police.”

Clause five provides for an amendment to Section 9 of the principle Act, “by deleting the penalty of a fine not exceeding level 8 or to imprisonment for a period not exceeding two years and make necessary substitution in order to bring the Act in line with the minimum mandatory of 10 years.”

The Sunday Mail

AUSTRALIA Stock Exchange-listed oil and gas explorer, Invictus Energy yesterday requested government to expand its exploration claims in Muzarabani by 10 times, marking another phase in the firm’s hunt for its first find in Zimbabwe.

Invictus, which has already reported major milestones at the potentially lucrative project, said increasing its exploration fields would be key as it progresses with the landmark deal.

The firm is currently exploring for oil on a 100 000-hectare special grant in the Zambezi Valley.

If the request is granted, it will take its oilfields to about one million hectares.

“Zimbabwe needs to expand oil and gas exploration block,” Invictus Energy technical director Brent Barber told delegates at the Chamber of Mines of Zimbabwe annual general meeting in Harare.

“The size is not competitive with other neighbouring countries. The money is becoming harder and harder to find. The size of grants is important. We have applied for an increase of our concession for exploration. Our current space is drastically reducing the commercial component of it. At the moment we have not made any discovery,” Barber said.

In  response, Mines deputy minister Polite Kambamura said: “On the issue of more land, we need to sit down and come to common ground.”

The government also undertook to extend a tax relief as it takes bold steps to make its first find in the southern African country.

Mercy Manyuchi, the acting chief director for mining development in the ministry said Invictus would enjoy tax holidays when importing drilling equipment.

“We are currently working on putting rebates with Finance ministry for their equipment for drilling purposes,” she said.

Invictus and the government recently signed a petroleum exploration development and production agreement (PEDPA).

Under the PEDPA, Invictus was granted rights to undertake production for the next 25 years and the project was granted Special Economic Zone status.

Deliberations are already underway to finalise the petroleum production sharing Agreement (PPSA), which will spell out how the output will be shared among stakeholders.

The firm will drill its first test well in the final quarter of 2021 and has recently worked towards establishing the exact location for sinking the shaft.

In March, the outfit raised about US$6 million for the project.

Invictus intends to conduct, process and interpret a minimum of 400 line kilometres of 2D seismic in order to refine the Muzarabani-1 drilling location and well path.

The southern Africa-focused Australian firm, which has been exploring for oil/gas on swathes of the Zambezi Basin forests since 2015, has said it could be sitting on Africa’s largest find.

NewsDay

THE spike in gold smuggling cases in Zimbabwe is worrisome. Gold smuggling has compounded the country’s economic woes, frustrating government efforts to leverage on its abundant mineral resources.

The country is said to be losing an average of US$1,5 billion in potential revenue each year through gold smuggling. The amount is way above the US$800 million official Fidelity Printers and Refiners (FPR) export earnings per annum. Smuggling is also likely to stifle the attainment of the targeted US$12 billion mining sector revenue by 2023.

The country’s porous borders have contributed to smuggling of gold. Massive gold leakages are claimed to be facilitated by a well-connected syndicate taking advantage of inconsistent gold policies and unattractive prices in the country.

Security forces have, on many occasions, been fingered as accomplices in gold smuggling syndicates.

Former ZMF aide Tashinga Masinire was recently arrested at Oliver Tambo Airport in South Africa with 23 pieces of gold he had smuggled from Zimbabwe. According to Home Affairs minister Kazembe Kazembe, the gold smuggling syndicate was interwoven with security operatives at the airport.

He said: “We are going to leave no stone unturned in finding out what happened. We want to know how this man (Masinire) left the country with all that gold. So far we have established that when he walked in at the RGM International Airport he didn’t have a bag, now we want to establish who gave him that bag, where, and how. Investigations are ongoing, as I said, I am confident we will unearth what transpired on the day as soon as possible, working with our Interpol colleagues”.

It is high time Kazembe goes beyond rhetoric and plug the loopholes if the government is really committed to achieving a US$12 billion mining economy.

Government must promulgate consistent gold policies that address issues around possession, dealing and marketing of precious minerals.

The country lacks a defined gold policy, as there is a contradiction between the Gold Trade Act and the situation on the ground. Section 3(1) of the Gold Act states: “No person shall, either as principal or agent, deal in or possess gold, unless; he is the holder of a licence or permit, or a holder or tributor or holder of an authority, grant or permit issued under the Mines and Minerals Act or an employee or agent of any of the persons mentioned above and is authorized by his employer or principal to deal in or possess gold in the lawful possession of such employer or principal.” While the Gold Trade Act prohibits possession and trading of gold without a licence, FPR is employing a no-questions-asked process to promote artisanal and small-scale miners. The artisanal and small-scale miners used to be a major gold contributor to FPR but have now become big smugglers.

The ambiguity of the no-questions-asked policy adopted by FPR promotes smuggling of the yellow metal.

A consistent gold policy will go a long way in curbing smuggling of the precious mineral, for they say a stitch in time saves nine.

NewsDay

MINES and Mining Development Minister, Winston Chitando, says the target of producing 100 tonnes of gold is achievable but producers need improved access to alternative sources of financing such as loans.

As the Government drives towards the US$12 billion mining industry by 2023 gold production, alongside platinum group metals, hydrocarbons like oil and gas, coal, gold, lithium, chrome and ferrochrome, must be the major contributors.

The target will be made possible by optimum investment and output levels in all mineral commodities. The gold sector, drawing from both small and large-scale producers, targets to produce 100 tonnes of gold from about 30 tonnes.

The mining industry is expected to contribute significantly to the country’s vision of Zimbabwe becoming an upper-middle-income economy by the year 2030 with gold playing a significant role.

Speaking at the Chamber of Mines Annual General Meeting and Conference, Minister Chitando said the ravaging effects of Covid-19, which caused a fall in mineral prices as well as death of key personnel in the sector, should not dampen spirits in mining but motivate players to overcome challenges while also keeping focused to achieve the set targets.

“It is worth noting that despite these challenges, the Zimbabwe mining sector has remained resilient as we work towards attaining our milestone of a US$12 billion mining industry by the year 2023.

“The sector continues to play a significant role in the country’s economic development, contributing 60 percent of export receipts in 2020,” said the minister.

“Government’s thrust to increase gold production from the current levels of about 20,87 tonnes in 2020 to about 100 tonnes by 2023, contributing US$4 billion to the US$12 billion is an achievable milestone. In order to achieve this target, Government is mainly looking at enhanced exploration and development of medium to large-scale mines as well as capacitation of small-scale miners,” said Minister Chitando.

He said the Government would seek to intensify its monitoring and surveillance exercises to curb illicit trade in gold and ensure gold is delivered to Fidelity Printers and Refiners.

The minister said there were a number of gold projects coming up, which will further increase production.

These include Shamva Gold Mine, which was commissioned last year and Eureka Gold Mine, which is set to resume operations next month, as well as the Caledonia Mine installation of a new US$60 million shaft in Gwanda.

The minister said the Government was also working with various private players to capacitate small-scale miners through the introduction of private-led gold service centres as well as command mining, using the same model as in agriculture.

“There are three specific issues that have come out here (conference) and we will pick them up in our normal interface. There is a need to ensure that we surpass 100 tonnes target and utilisation of gold loans through the intervention of coming up with structures where gold producers will be allowed to have structures in which they access gold loans. There is need for us as Chamber and Government to come up with a menu of alternative finance options,” said Minister Chitando.

He said there will be engagements among stakeholders within the purview of the Chamber of Mines to that effect.
The theme for the conference, which effectively ended yesterday was: “Navigating turbulent times — Sustaining growth of the mining industry beyond Covid-19.”

Minister Chitando said the conference came at an appropriate time as the Government was working hard to implement the National Development Strategy 1 (NDS1:2021-2025), a key building block towards Vision 2030.

He said policies by the Second Republic have seen an increased investor appetite in the mining sector.

The Chronicle

HYDROCARBONS and platinum were among the top discussion points at the Chamber of Mines’ three-day annual indaba that ends in Victoria Falls today.

Officially opened by President Mnangagwa yesterday, the conference is being held under the theme: “Navigating turbulent times — Sustaining growth of the mining industry beyond Covid-19.”

Mining investors and executives discussed a number of issues on the local mining industry with the country’s hydrocarbon potential and platinum leading. There were two symposia, one focusing on oil and gas while the other was on platinum.

Gold is an old mineral, whose potential remains enormous, just like chrome, lithium, coal, diamond as well as platinum.

However, we, as the Minister of Mines and Mining Development Winston Chitando said on Thursday, have a soft spot for oil and gas, an emerging mining sub-sector in the country and one which has stupendous potential.

There is hydrocarbon potential in Lupane and Chiredzi but progress towards exploration of a highly prospective target in Muzarabani has got us dreaming.

We have seen how oil and gas have performed socio-economic miracles in Qatar, United Arab Emirates (UAE), Brunei, Saudi Arabia and Kuwait among other countries. The countries are among the world’s richest and most well-developed. Standards of living of their people are out of this world. Everything is perfect through and through. All this has been possible because of the countries’ oil and gas endowments.

In Africa, Algeria and Egypt are heading up there; Angola is moving up as is Nigeria. Mozambique is on the cusp following impressive offshore discoveries north of that country.

The advances that are being made by Invictus Energy and its local partner, One Gas Resources at their oil and gas acreage in Muzarabani are making us dream that with judicious management of revenue from the hydrocarbons, Zimbabwe could develop as fast as Qatar, UAE, Kuwait and other oil producing nations have done in recent years.

Minister Chitando said his ministry has an inclination towards oil and gas.

He said: “This is an opportunity to critically explore the potential that exists in Zimbabwe’s oil and gas mining industry, to share experiences in developing a world-class oil and gas mining industry leveraging on the gains from our economic reforms, engagement and re-engagement with the international community.

The oil and gas sector is one among other resources that have the potential to contribute towards the speedy attainment of our national vision to become an upper-middle-income economy by 2030. Given the strategic importance of oil and gas in Zimbabwe, my ministry is strategically monitoring and evaluating the progress made in terms of exploration of the occurrence of this strategic mineral in Muzarabani.”

Geo Associates, the partnership between Invictus Energy, registered in Australia, and One Gas Resources, a locally-owned company, must be commended for the work they are doing that could lead to exploratory drilling at Muzarabani in the next few months.

That, we are optimistic, should lead to a commercial discovery, paving the way for the mobilisation of resources for development and extraction of the gas and oil from that target.

But for greater value to be unlocked from the oil and gas, we want the Government and Geo Associates to work out a programme for value addition. Qatar, UAE, Kuwait and Saudi Arabia are so rich because they are exporting refined oil, which pays big, not crude which is cheaper. They are also processing their gas to produce electricity and other products.

So as soon as a commercial discovery is made at Muzarabani, development is done, it must not take a long time for the investors, working with the Government, for more value to be added to the oil and gas.

The people who are paying so much for petrol and diesel will look forward to both fuels being cheaper as they would be made from locally-mined oil. They, too, would be happy that some of the gas to be used for electricity generation so that the national reliance on hydro and coal generation is reduced. That would ensure more energy security and possibly lead to lower electricity prices.

A full-fledged oil and gas industry also means more jobs and greater national development.

The Chronicle

The Chronicle