Mining ZimbabweLatest Mining News, Policy and Industry Updates

ZISCOSTEEL Finance Executive Munashe Mabheza has become the first person to succumb to Covid-19 in Redcliff.

Mabheza passed on Saturday night at his home in Redcliff.

Redcliff Mayor Clayton Masiyatsva confirmed the death.

“This is the first Covid-19 death in Redcliff. We have gathered that the now deceased is Mr Mabheza, the Financial Executive at Ziscosteel. He died at his home,” Masiyatsva said.

He added that Mabheza had not been aware of his status.

“He didn’t know that he had contracted the deadly virus. It was only after the rapid response team had gone to his place that they discovered he had Covid-19 after testing was conducted by Mars.

“His family initially bared the tasksforce insisting that no-one was sick at the place. It was only after his health deteriorated that they called Mars. Unfortunately, he couldn’t be saved so he died at home,” Masiyatsva said.

The steel manufacturing town of Redcliff now has eight confirmed Covid-19 cases.

“The virus is real and I urge people to take all the precautionary measures as stipulated by World Health Organisation guidelines,” Masiyatsva said.

Midlands has since become one of the epicentres of the deadly virus after Harare and Bulawayo.

Midlands has 390 Covid-19 cases and 5 deaths.

Nationally 105 people have succumbed to Covid-19 out of 4 575 cases_ NewZimbabwe.com

The government urged to ring-fence opportunities for women by reserving extractive sector quotas for women and provides systems that ensure the inclusion of women in the US$12 billion mining strategy.

Speaking during a virtual discussion on women participation in the mining sector towards achieving the 12 billion economy facilitated by Zimbabwe Allied Diamond Workers Union (ZIDAWU) women said they are being left behind.

Government, they said must provide tax incentives to companies which provide upstream female employment, decree minimum quotas of women employment, and develop local procurement plans which guarantee equal access and opportunities for women.

Abby Musiyazviriyo of Marange Development Trust (MDT) said with the abundance of available upstream and downstream linkages in the mining sector, women can also carve niches for themselves.

She said, “Vast upstream, downstream linkages in the mining value chain provides for investment in local content development, power, technology, infrastructure technology and improvement of livelihoods for sustainable development,”

Musiyazviriyo said the government must pursue (or amend existing) policies that incentivize investors which maximize linkage creations that promote women empowerment and impose tax restrictions on those that outsource such linkages.

She said in the continent there are abundant case studies including in South Africa, Botswana, and Nigeria on how governments can leverage upstream and downstream linkages, promote local content development, and promote women participation in mining.

“These linkages are contextual applying to a specific area at a specific time and the opportunities that they present are highly dependent on the existing know-how, expertise, and legal framework in the areas where extraction of minerals is taking place.

“In seeking to develop these linkages, pro linkage policies should be crafted or the existing policies
reformed to stipulate that companies must source domestic suppliers, impose import restrictions to
incentivize downstream processing.

“Government should avoid using incentives like tax holiday and granting subsidies that are contingent
to the sourcing of goods domestic. Furthermore, government should be at the fore of linkage creation
from the extractive sector.

“Policymakers should understand the variegated ways in which women are excluded and adversely
incorporated in the mining sector so that their presence can be improved and women can continue
to be visible and their representation in the sector can also improve,” said Musiyazviriyo.

Sophia Takuva a small scale miner from Zvishavane says providing quotas for women in the mining
value chain alone, without formalization of artisanal mining, may not be adequate to stimulate
inclusive growth towards the US$12 billion target.

She argues that while women can significantly contribute in linkages in the mining sector,
formalization will remove barriers of entry and ensure that government reaps high yields from low
hanging opportunities like gemstone mining.

“There is a need to open these areas for pegging and capacitate small scale miners with necessary
equipment as soon as they finish registration and knowledge on basic gemstone mining and
processing (gemstone finishing, cutting, and polishing).

“In Chiadzwa for example, diamond eld exploration of diamonds shows that there are reserves with
low yields and grades, also there are gemstones like zircon, quarts and corundum these gemstone
rich areas must then benet local communities.

“We can reserve these areas for women and also ensure that beneficiation mechanisms are put in place to create employment and empower women to actively participate in value edition while showcasing their crafting skills. This will bring in more revenue and selling of finished products brings more value to the minerals,” she said.

Takuva said the government’s mines and mineral procedures must also be computerized and open up reserves for locals to peg and mine, with quotas reserved for women only, under close monitoring of bigger mining corporations.

She said to achieve this transparency and accountability are key enablers to ensure exploitation of mineral resources gives birth to benefits for local developmental needs and ensure sustainable local content development.

“Women are there in the mining sector but they may be at the periphery that sometimes they may
not be recognized because of the multi-tasking nature of mining.

“Although women and youth are at the periphery in the ASM sector they play a great role and can
bring change if supported, these two groups face challenges with registration and this is fueled by a
corrupt system that is slow in facilitating necessary processes in time.

“There is need for a computerized and accessible mining cadastre for transparency on licensing, we
have artisanal gemstone miners where are the gemstones sold to, obliviously to the black market and
the country loses,” said Takuva_263Chat

In its latest mining sector and communities situational report, the Zimbabwe Environmental Law Association (Zela) said small-scale chrome producers were facing challenges to access markets for their chrome.

ZIMBABWE’S small-scale chrome miners are stuck with tonnes of ore which they are failing to sell to the international markets following the closure of borders due to the COVID-19 pandemic outbreak.

“The Chinese are the main buyers of chrome in Zimbabwe. As a result of the pandemic, borders have been closed and no buyers have been able to buy the chrome. This has left chrome small-scale miners stuck with the ore which can be easily stolen by criminals in the sector,” read part of the report.

“Chrome prices are at relatively low levels and it is difficult to see how chrome producers will benefit. Many ferrochrome producers and international markets suspended operations.”
In Zimbabwe, the Minerals Marketing Corporation of Zimbabwe controls the prices of all minerals mined in the country.

Chrome is one of Zimbabwe’s main exports after gold, platinum group metals and diamonds.

Zimbabwe has the world’s second-largest known chrome ore deposits, with about 900 million tonnes of untapped ore against total world reserves estimated to be 7,5 billion tonnes.
Only South Africa has more chrome ore reserves than Zimbabwe.

Zela said although the mining industry was given a reprieve at the start of the COVID-19-induced national lockdown to continue operating upon meeting certain conditions, the chrome sector had already been experiencing operational challenges way before the deadly global pandemic struck.

Chrome producers suffered another blow after its stainless steel-making markets in Europe and Asia scaled down operations.

At the end of March this year, Zimasco, one of the country’s largest chrome producers, temporarily halted its smelting and related mining operations in response to weak global demand and resultant low prices for ferrochrome, which made continued production unviable.

NewsDay

Governments and advocates of cleaner environments are pushing for it and platinum producers are having nightmares about it; “The shift towards New Energy Vehicles (EVs)”.

Some governments have also declared their intention to grow the share of EVs in their countries’ automobiles market.

The proportion of EV, PHV, and hybrids in global auto sales is estimated to reach between 50% to 60% by 2030.

The electric car market penetration into the global vehicle fleet (1.2 billon cars) will be the key demand driver.

The current market share of yearly EV sales in just under 1.0%.

Overall, a drastic change in the automobile industry and materials sector is expected as EVs (which use Lithium-ion-Battery) will take the place of the internal combustion engines (petrol and diesel).

The implication is certain kind of mineral resources are going to be in high demand.

A Lithium-ion-Battery requires Lithium, Cobalt, Nickel, and Graphite as significant materials.

Already, the demand for these resources is in a surprising uptrend.

Lithium requirement is likely to reach 36 times current demand by 2030.

The other materials are also expected to see a similar surge in demand.

While the EV story has been cited as one of the drivers of nickel prices going forward, nickel demand from the electric car market will largely be dependent on the selection of energy storage technology, which is still to be decided by the major PEV manufactures.

Nickel is likely to form part of the cathode of choice however this is then a function of how large the battery will be in the respective vehicles.

We note that nickel is generally the weakest of the so-called battery metals. Only 6.0% of output goes into batteries and nickel is still mainly a steel play (more than twothirds is used steel).

Nickel is more tied to outlook for China’s economy.

Overall, Nickel producers should still benefit from the growth in the demand for batteries used in electric vehicles (EVs).

EV production is expected to register double-digit growth rates as the clean energy revolution continues.

Bindura Nickel Corporation (BNC) is strategically positioned but will have to invest more so as to benefit fully from firmer prices.

We estimate the required capital injection to be in the region of USD30m – USD40m.

That said, while the counter looks very cheap compared to its international peers, we are still concerned about the value depreciation to shareholders emanating from the incomplete smelter project.

We have a SPECULATIVE BUY recommendation on BNC.

Batanai Matsika is the Head of Research at Morgan & Co. He can be contacted on +263 78 358 4745 or email: batanai@morganzim.

This was revealed by the Zimbabwe Environmental Law Association (Zela) in its COVID-19 mining sector and communities’ situational report.

DISRUPTION of employment and increasing levels of poverty during the COVID-19 pandemic has forced artisanal small-scale miners to resume their activities, raising fear of the resurfacing of the dreaded machete gangs.

“With many jobs and sources of income being disrupted, and the high costs of basic commodities, many people are increasingly moving into the ASM [artisanal small-scale] gold sector for the quick money they can get,” the Zela report said.

“A series of machete violence cases have been reported in June and July 2020. In Zvishavane, one man was injured during a gold rush.

“In Matobo, at Nugget Mine, a machete gang violence case was reported. Reports of the gang invasions were also recorded in Maphisa, Makwe, and Mvana, with criminals and gold gangs escaping with cash, digital scales, and gold ore.”

Added Zela: “Machete violence incidents have been recorded in a number of mines in Bubi, where the criminal gangs managed to get away with the gold ore.

“In Gwanda, machete gangs have been reported at Vhovha Mine, where they assaulted and injured several miners and got away with gold ore. The police were able to arrest the gang leader after he was handed over to police by the miners who tracked him down to Gwanda.”

The Zela report also said soldiers were reported to be raiding artisanal miners, while police were arresting and closing some mines in cases where miners were not complying with COVID 19 regulations.

“In Matabeleland South, 145 ASM miners were arrested in Gwanda, while 115 were arrested in Bulilimangwe.

“During a recent Parliamentary Committee on Mines meeting in Mutare (23 July 2020) a representative of the Zimbabwe Miners Federation (ZMF) informed parliamentarians that many artisanal and small-scale miners are being arrested, but gold mining activities go on even at mid-night in the ASM sector,” Zela said.

Recently, the Zimbabwe Miners Federation leader Wellington Takavarasha appeared before the Parliamentary Portfolio Committee on Mines led by Edmond Mkaratigwa and called for the formalisation of artisanal mining to enable the miners to operate within the law.

Zela also said there were growing mining claims disputes within the ASM which could be attributed to the use of archaic manual claim allocation and mapping systems in Zimbabwe.
“The use of the manual system has resulted in claim disputes with some claims being double pegged or boundaries overlapping.

“The disputes have resulted in violence. A case was recorded in Penhalonga. A gold miner allegedly hired bouncers to rob a rival of gold ore worth over USD 500 over a mining boundary dispute.”

They said the Ministry of Mines confirmed that processing of mining licenses was slow due to a high number of applications in 2020 and shortages of staff.

“Over the year, the Ministry of Mines has been issuing 2 500 mining titles per year. However, by July 2020, there have been a massive number of applications for mining licences to the Ministry of Mines.

“A large number of applications are straining the Ministry since it does not have adequate resources-human resources and equipment to process mining titles. This has affected the speed of processing mining titles.” Zela said_NewsDay

DESPERATE Chiadzwa villagers, who are fed up with unfulfilled pledges and neglect by the Zimbabwe Consolidated Diamond Company (ZCDC), have decided to pool resources and start income-generating projects in the community.

Pushed by persistent hunger, the villagers contributed funds to the Bocha Diamonds Development Trust (BDDT) for horticulture, poultry and piggery projects, among others, launched in June this year.

BDDT board chairperson Moses Mukwada recently told NewsDay that they were tired of engaging the diamond miners, who have failed to fulfil their own promises.

“For the meantime, we have stopped engaging the Zimbabwe Consolidated Diamond Company because they are failing to attend to our challenges. It seems they are reluctant to assist us. There are legacy issues because as villagers, we were supposed to be assisted in these projects. So starting from 2020, we are not speaking to them and we are now doing our own things,’’ he said.

“The company is even failing to maintain a borehole and the roads are in a bad state. Everything is stuck. There is nothing on community development. So how can we continue to engage them yet it is clear that they do not care about us? We have realised that we need to take action by starting our own projects.”

Added Mukwada: “So these projects that we have started are meant to sustain our livelihoods. We have few resources, through the contribution of funds from the villagers and this has shown dedication. With these contributions we are starting to move on with our lives.”

Since the inception of diamond mining in Marange around 2005, the villagers affected by mining operations were supposed to be compensated and benefit from miners’ corporate social responsibility programmes.

But sadly, infrastructure including roads and water was never developed.

Last week, ZCDC acting chief executive officer Roberto de Pretto said he was shocked by the level of poverty and underdevelopment in Chiadzwa despite being endowed with one of the largest diamond deposits in the world.

De Pretto made the remarks at a stakeholders meeting in Mutare which was hosted by the Parliamentary Portfolio Committee on Mines and Mining Development.

“It is disheartening to walk past Chiadzwa. The area still has no running water and poor roads while children walk long distances to school,” he said
“It is a shock to me that there is no development despite that Chiadzwa fields have one of the largest diamond deposits in the world.”_NewsDay