Mining ZimbabweLatest Mining News, Policy and Industry Updates

THE community of Dinde is lobbying African governments and those of other countries to help to force the Zimbabwean government to respect their constitutional rights.

This is a Chinese-owned investment company, Beifa Investments is forcing 600 families out of their homes, to make way for a coal-mining project.

“The people must be respected, especially their right to live on their ancestral land without being harassed. Chinese finance should support renewable energy, which has the promise of great results for the people and the environment,” Maguwu said.

The action by the centre, a coalition of several NGOs and trade unions, is aimed at preventing the risk of major pollution and a looming environmental threat, should Beifa Investments be allowed to mine coal in the area, which is in northwest Zimbabwe, close to the Zambian border.

“The major risk is pollution of the Nyatuwe River, the only source of water for humans and livestock [in Dinde]. Due to [the] politicisation of minerals the Environmental Management Act is now ineffective, hence they [the government] can’t be trusted with enforcing environmental regulations,” Maguwu said. “Beifa Investments also intends to construct a 270-megawatt power plant which significantly affects air quality in Dinde.”

According to Maguwu, the coalition is planning to submit a petition to the Zimbabwe Mines Ministry, and international NGOs and media are paying great attention to the developments in the case.

“The Dinde case is also casting a spotlight on mineral governance in Zimbabwe, how the ruling elites are entering into personal, corrupt deals with fly-by-night investors,” Maguwu said. “Because these deals are for personal benefit, there is no consultation with people. To deal with resistance, the ruling elites are also abusing state security to intimidate and harass local communities. This is a growing concern.”

Beifa Investments has proposed relocating the people of Dinde from their ancestral land, which had stirred many conflicts. However, the coalition says any possible relocation will have to be agreed to by the community first.

“The challenge is the precedent set in Marange, eastern Zimbabwe, where the government displaced 1 300 families to pave [the]  for diamond mining. The moment the government and companies succeeded in moving the families off their land they broke all the promises they made before the displacement,” said Maguwu.

Neither Beifa Investments nor the Zimbabwean Ministry of Mines responded to questions from the M&G by the time of publication.

NewZimbabwe

ZIMBABWE’S total gold production in the first quarter of the year declined by 30 percent to 4,3 tonnes compared to 6,1 tonnes in the same period last year.

The yellow metal is one of Zimbabwe’s major foreign currency earners. Gold is expected to contribute US$4 billion to the US$12 billion the mining sector is expected to earn annually by 2023.

According to the first quarter Treasury report released last week, the decline in gold output was attributed to subdued productivity by artisanal and small-scale miners.

“Gold output during the first quarter stood at 4,311 tonnes compared to 6,152 tonnes produced in the same period in 2020 and 4,794 tonnes in the last quarter.

“The decline was mainly as a result of fall in production from artisanal and small-scale gold sector,” said the report.
Large scale miners produced about 2,3 tonnes.

“Large scale producers delivered about 2,291 tonnes during the first quarter of 2021 which is 11,2 percent higher than what was produced during the same period in 2020 while artisanal and small-scale gold sector delivered 1,586 tonnes, about 55,6 percent below the production of the same period in 2020, reflecting leakages through smuggling.”

Overally, the report stated that performance of the mining sector was mixed while on one hand, firm international prices and resuscitation of closed mines improved the performance of the mining sector.

“There were major drawbacks from a number of factors such as unstable power supply, heavy rains, which culminated in the flooding of shafts, working capital challenges and subdued demand for some minerals.

“Overall, platinum, diamonds and coal performed better than the previous quarter while gold, chrome and nickel suffered some declines,” it said.

During the first quarter, platinum output stood at 3,369 tonnes, a five percent decline compared to 3,544 tonnes produced during the same period in 2020.

However, this level of output slightly surpassed production for the previous quarter by 1,3 percent.

Going forward, platinum output is projected to improve as one of the major producer resumes production at the closed mine while other mines are also undertaking efficient enhancing measures.

During the period under review, nickel output stood at 3,284 tonnes and this was 16,6 percent and 22,1 percent below output produced in the comparable period in 2020 and in the previous quarter (Q4 2020), respectively.

“Reduced nickel output reflects low throughput from both primary and secondary producers.

“Output from the primary producers was 25 percent lower than the first quarter production in 2020.

“Similarly, this level of output was 44 percent lower than what was realised in the preceding quarter.

“The decrease in nickel output was against a surge in prices by about 39 percent in the first quarter compared to the same period in 2020 and 10,4 percent above the last quarter of 2020,” said the report.

Diamond production increased by 15 percent to 702 639 carats in the first quarter of 2021 from 611 331 carats produced in the same period in 2020.

The increase in production was registered from only two producers that were operational during the first quarter of the year with Treasury saying the output could have been higher if all players were producing.

“Furthermore, production was also driven by opening of the world economy and strong demand particularly from China.”

During the quarter under review, coal production stood at 596 753 tonnes compared to 462 140 tonnes produced during the same period in 2020. Producers were mainly constrained by delays in payments for coal deliveries, which adversely impacted on coal mining activities.

“Furthermore, production was also affected by limited absorption capacity during the first quarter due to non-operation of most of the units, which saw three producers also cutting back output as there was no off taker for thermal power,” said the report.

Following onset of the second wave Covid-19 pandemic during the first quarter of 2021, it said chrome production receded to 300 926 tonnes from 353 669 tonnes for the same period in 2020 and 311 495 tonnes in the fourth quarter of last year.

Of the chrome ore produced, about 74 percent was beneficiated and value-added and disposed as high carbon ferrochrome (HCF) while only 26 percent was sold as raw chrome.

“This is due to the favourable prices of HCF that prevailed during the quarter compared to those of raw chrome.

“Meanwhile, chrome producers have started modernising equipment and refurbishing their furnaces in order to boost production in response to increased demand in markets such as China and firming up of prices,” it said.

The Chronicle

Yesterday marked 49 years since the Kamandama Mine disaster at Hwange Colliery where 427 miners lost their lives.

The disaster remains the worst mine disaster in the country’s history and every June 6, commemorations are held to honour the 427 miners who perished in 1972 at the Colliery’s Kamandama Mine Disaster.

A Golf Tournament is held before the commemorations to raise funds towards the cause, but this year it was not held due to Covid-19.

According to the Hwange website, the Wankie coal mine disaster took place on 6 June 1972 when a series of underground explosions occurred at the Wankie No.2 colliery in Rhodesia (now known as Zimbabwe).

Historical records established that the accident was caused by an underground methane dust explosion and despite the several attempts by the then PROTO teams to rescue mine workers, the fatality of the disaster was such that the mine shaft had to be sealed off.

The disaster took place at the Wankie No.2 Colliery in Wankie, (now known as Hwange) in Matabeleland North, when several gas explosions ripped through the mine. It was initially believed that more than 470 miners were trapped, but the number was lowered after the owners found a number of people had shown up for work.

Eight men were pulled alive from the mine after the initial explosions. Two new explosions on 7 June poured clouds of poisonous gas into the 4.8KMs of tunnels, making further rescue attempts impossible.

On June, 9 1972 the then general manager of the Wankie colliery, Gordon Livingstone-Blevins, decided to leave the 424 bodies where they were. Three bodies had been recovered after the initial explosions.

A mass memorial service took place on 11 June at a nearby football stadium, where a crowd of about 5,000 people paid tribute.

Hwange has gone though tremendous transformation since then and in 2018 President Mnangagwa signed several investment agreements with China.

Hwange Units 7 & 8 Thermal Power Station expansion which will add 600 MW to the national grid is one of the mega projects.

The Chronicle

THE Ministry of Public Service, Labour and Social Welfare has started engaging its South African counterparts to facilitate the compensation of Zimbabweans who contracted respiratory diseases while working in South Africa’s gold mines under the Witwatersrand Native Labour Association (Wenela).

Mine workers who were exposed to harmful substances and contracted lung diseases at the South African gold mines are set to receive compensation worth R10 000 to R500 000.

Public Service, Labour and Social Welfare Minister Professor Paul Mavima told The Sunday Mail that Zimbabwe and South Africa have activated an agreement made under the two countries’ Bi-National Commission to establish a Joint Taskforce to facilitate payment of the compensation.

Beneficiaries of the payments are obliged to be tested for the respiratory diseases.

Prof Mavima said 400 prospective beneficiaries have been tested in Bulawayo so far, with the testing programme to be rolled out in all the country’s provinces.

“The Ministry of Public Service Labour and Social Welfare in partnership with the Ministry of Health and Child Care and the National Social Security Authority is conducting medical examinations and registration of potential beneficiaries for Compensation for Pneumoconiosis to facilitate claims for compensation through the Tshiamiso Trust which was established to process the claims. Initial phase has targeted three provinces, Harare, Bulawayo and Masvingo. Around 400 ex-miners and their dependents have been registered in Bulawayo through the medical surveillance programme. The rest of the provinces will be completed with lessons learnt from the initial phase.”

Ex-Wenela Miners Association of Zimbabwe president Mr Lungelwe Mkhwananzi implored other potential beneficiaries to undergo the tests.

“The Public Service, Labour and Social Welfare in partnership with National Social Services Authority (NSSA) will be testing for pneumoconiosis and silicosis, as well as registration of the ex-Wenela mine workers.  The process started on May 31, 2021.

“The mobile testing and registration will be rolled out in all of the country’s 10 provinces. We are calling on all ex-Wenela workers to come forward and get tested and be registered. This exercise is being done for free,” he said.

In 2019, the Johannesburg High Court ruled that workers who contracted either Silicosis or Tuberculosis will get compensated upon receiving diagnosis.

About 10 000 ex-mine workers are expected to get the funds. The workers used to be employed by African Rainbow Minerals, Anglo American South Africa, AngloGold Ashanti, Gold Fields, Harmony Gold and Sibanye-Stillwater.

The Sunday Mail

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