Mining ZimbabweLatest Mining News, Policy and Industry Updates

Controversial Israeli businessman, Luka Ignatius Fabris, is setting up a multi-million-dollar mineral processing plant at Tafuna Hills in Shamva district, Mashonaland Central.

Fabris confirmed the development saying he was undertaking the project with some partners.

“This is a processing plant for various minerals including gold and as you are aware this project has different partners. We are still in the initial stages of the project. The project is at Tafuna Hills in Mashonaland Central. I cannot divulge the size of the investment at the moment,” Fabris said.

Fabris has been subject to controversy.

In 2018, the Reserve Bank of Zimbabwe (RBZ) froze a US$1m deposit held by a local bank amid suspicions it could be proceeds from an illegal gold deal involving 27 kilogrammes of bullion exported by a company listed in President Emmerson Mnangagwa’s externalisation list released that same year.

The gold was allegedly exported from Zimbabwe by Fabris, a director of Fabris Construction and Spartan Security (Pvt) Ltd and delivered to African Gold Refinery — which focuses on gold processing and trading — in Uganda.

The construction of a processing plant by Fabris comes at a time when the RBZ has moved in to plug gold leakages by introducing a cocktail of incentives.

Recently, the RBZ introduced a 5% incentive for those who deliver above 20kg a month.

In addition, the RBZ cut royalties and the cost of importing cash on small scale miners to improve gold production in the country amid revelations the economy was losing over 2.5 tonnes per month to smuggling.

The central bank also allowed small scale miners to sell gold at the prevailing international gold price.

This increased investor appetite for establishing state-of-the-art processing facilities.

Gold deliveries to the country’s sole buyer and marketer of the yellow metal more than doubled to 2.92 tonnes in June from 1.409 tonnes during the same period last year on incentives as experts say the upward trajectory would be maintained throughout the year.

In a bid to boost production, gold miners also want financial support through gold loans to boost production of the yellow metal as the government targets an output of 100 tonnes by 2023.

Government has set an ambitious gold production target of 100 tonnes by 2023. Gold is expected to contribute at least US$4bn annually towards achieving the mining sector’s target of S$12bn industry by 2023.

Government is also working with various investors to capacitate small to medium scale gold miners.

Gold production declined over the past two years but miners have remained optimistic of the country’s potential to achieve its target of producing 100 tonnes annually.

Gold production had dropped from 35 tonnes in 2018 to around 20 tonnes last year due to an unfavourable pricing regime that has fuelled smuggling of the yellow metal.

A number of mining and fiscal measures have since been adopted by the government to provide a window of opportunity to revive production and grow the sector.

These included the review of the foreign currency retention ratio in a bid to boost production.

Business Times

THE ongoing asset forensic audit at the defunct steel giant, Ziscosteel, is nearing completion with most of the assets having been accounted for, the company’s public relations manager, Ms Patricia Muzenda, has said.

The Government embarked on a forensic audit at the defunct steel company to ascertain the losses at the amid reports of looting of assets by a well-orchestrated group comprising of former employees and security guards.

“Most assets have been identified through an asset audit that was recently carried out and the assets register is being updated accordingly,” said Ms Muzenda in a statement.

“The issue of security at the plant has been addressed through the number of security personnel and providing them with proper uniforms and equipment such as motorcycles for patrolling around premises and firearms. 

“As a result of cases and theft and vandalism of equipment have significantly reduced over the last six months.”

The Chronicle

INVICTUS Energy, the Australian firm hunting for oil and gas in Muzarabani, may start drilling exploration wells early next year, after taking delivery of massive state -of -the –art- equipment to be used in identifying well sites.

Managing director Scott MacMillan said the more than 20 truckloads of seismic survey equipment offloaded at Durban Port, were now on their way to Beitbridge, en-route to a workshop in Harare before being deployed in Muzarabani.

Seismic survey is a method used in exploration, especially for oil and gas, to gather sub-surface vibrations that may help identify the exact locations of or existence of hydrocarbons.

This will be followed by the sinking of test wells to confirm whether the geologies of identified locations harbour pockets that trapped sediments that decomposed and turned into commercially viable oil or gas deposits.

‘The timeframe is being dictated by the lead time for fabrication of well heads and casing, which is currently 6-7 months. So, at this stage (drilling is) more likely next year,” MacMillan said.

He said Invictus needed to wait for completion of the seismic data to be processed and interpreted so that “we can locate the well site properly”. That process will be finished towards year end, he said.

The Invictus boss said the seismic survey was a “big deal and first time it has been done in the country for 30 years”. The last serious oil searches were done by French oil giant Mobil in the early 1990s.

Since a single test well may be four  kilometres deep and cost up to US$15 million to US$20 million to drill, Invictus is keen to ensure that the first well is sunk in the best possible location.

The Australian exploration junior awarded experienced Canadian firm Polaris Natural Resources the contract to undertake the seismic survey, a way of mapping geology through sub-surface vibrations.

Mines and Mining Development Minister Winston Chitando said following successful delivery of the equipment in Durban on Thursday last week, the equipment would be in Beitbridge by tomorrow.

“It is expected in Beitbridge in the next three to four days enroute to a workshop in Harare for service checks for a week or so before proceeding to Muzarabani,” Minister Chitando said.

Invictus Energy, an Australia Stock Exchange (ASX) listed company, has posted major milestones in its quest to discover oil or gas in Zimbabwe, after reinterpretation of Data gathered by Mobil.

After being verified by independent experts, the results showed encouraging evidence of potential existence of significant hydrocarbons in the Cabora Bassa Basin encompassing the Muzarabani prospect.

The delivery of the equipment for the seismic survey follows the approval by President Mnangagwa of the firm’s Petroleum Exploration and Product Agreement (PEDPA) in April this year.

President Mnangagwa said the PEDPA agreement would provide a pathway for Zimbabwe to exploit its hydro carbons while discovery of commercial oil and gas deposits could bring significant downstream economic benefits.

The benefits expected include energy self-sufficiency, production of petro-chemicals, increased revenue to the fiscus, growth of exports, new jobs and emergency of downstream industries, among others.

Invictus said earlier the PEDPA signed with the Government provides the framework for progression of the oil and gas project through exploration, appraisal, development and production phases as well as obligations and rights of each party during the project lifecycle.

As part of the building blocks for Vision 2030, by which Zimbabwe should have attained upper middle income economy status, the Government is working on growing mineral exports from US$3,7 billion to US$12 billion a year.

Business Weekly

ZIMBABWE continues to make progress in its efforts to improve power generation and end load shedding. Last Thursday, a Chinese company Zimbabwe Zhongxin Electrical Energy (ZZEE) announced that the first phase of its thermal power plant on the outskirts of Hwange town is 100 percent complete.

The plant is expected to start feeding 25MW into the national grid in September and this will be increased to 50MW in October.

The company which is rolling out its plants in phases said work on the second phase comprising two plants that will produce 135MW each is expected to start early next year while the third phase is scheduled to be completed in 2025.

This involves the construction of another two plants that will each produce 300MW that will be fed into the national grid.

The construction of a 5MW solar plant is also almost complete and is expected to go online in the next two weeks in the same district.

The plant is being developed by Solgas company which says it plans to establish similar plants in all the provinces to complement Government efforts to improve power generation.

The $1,5 billion Hwange Thermal Power Station expansion which entails the addition of units 7 and 8 is about 70 percent complete. This is expected to add a combined 600MW to the national grid. The units 7 and 8 together with the existing plant will generate an average of 1 300 MW.

The country has indeed achieved a major milestone towards self-sufficiency in power generation that will guarantee both commercial and domestic consumers adequate electricity.

The mining sector which is among the critical sectors that the country is banking on to turn around the economy needs adequate electricity throughout the year.

We are therefore, encouraged by the private companies that have started implementing power generation projects and we want at this juncture to implore those that are yet to do so to start work.

The target should be to produce not just enough to meet national demand but also surplus for export. Government working closely with the private sector is aggressively marketing the country as an investment destination of choice and one of the investors’ demands is uninterrupted electricity supplies.

Government has over the years been spending millions of dollars importing electricity from companies such as Eskom of South Africa and Hydro Cahora Bassa of Mozambique and this has to change. The country should in future earn millions of dollars from exporting electricity to the region and with the private sector support, this is very possible.

The Chronicle