Mining ZimbabweLatest Mining News, Policy and Industry Updates

ARTISANAL and small-scale gold miners continue to lead in gold production after they delivered 700 kilogrammes of the yellow metal to Fidelity Printers and Refiners (FPR) in July.

The figure was higher than the 650 kilogrammes delivered by large-scale mining entities in July. The high delivery volumes by small-scale miners is attributed to the recent move by FPR to benchmark gold payments on the London Bullion Market (LMBA), which has seen local miners getting paid in United States dollars only.

The LBMA is the world’s authority for precious metals that also sets standards that define how precious metals are refined, as well as traded worldwide. Gold is one of the country’s top foreign currency earners. The yellow metal grossed more than US$1,6 billion in 2018 for the export of 33 tonnes which now stands as the industry’s all-time peak in recent history.

Responding to questions from Sunday Business on Wednesday, FPR general manager Mr Fradreck Kunaka said although the sub-sector’s contribution was high, the whole sectors’ contribution was commendable.

“At Fidelity Printers and Refiners we always aim at offering the miners’ value for their gold. As from the 17th of July, 2020 the payment of gold was reviewed from paying $45 flat fee on fine gold to 100 percent United States dollars payment benchmarked against the prevailing LBMA exchange rate,” said Mr Kunaka.

Mr Kunaka said small scale producers were in the lead in terms of gold delivery statistics, as indicated by data at hand as of last month
“FPR got 1  406  3692 kg in total. Primary producers brought in 658  4123 kg while small-scale producers delivered 747  9569 kg.”

He said FPR’s had the aspiration to encourage artisanal and small-scale miners to remain competitive and discourage them from pursuing the black market.

“Payments in United States dollars that are benchmarked against the prevailing LBMA exchange rate are a move meant to encourage the gold miners to sell using the formal channels and to shun the black market,” said Mr Kunaka.

Earlier in the year, small scale miners expressed discontent with the Reserve Bank of Zimbabwe’s decision to pay gold producers 55 percent of their earnings in United States (US) dollars and 45 percent in local currency. The Central bank had defended the lowered foreign currency holding threshold by saying there was a need to preserve the scarce foreign currency.

Zimbabwe Miners Federation spokesperson Mr. Dosman Mangisi said the move by FPR to accede to the miners request had changed the fortunes of gold miners.

“The livelihood of miners has greatly improved although there are some areas that still need to be resolved. We commend the payment of 100 percent United States dollars,” said Mr. Mangisi.

The Sunday News

ZVISHAVANE-BASED platinum company, Mimosa Mining Company has produced more than 123 000 ounces of platinum in the financial year ended June 2020 and has surpassed its annual production capacity.

The company said it has shrugged off hurdles brought by Covid-19 to meet its target annual production after the Government granted its essential services status during the lockdown period. The company which is one of the largest platinum producers in the country is also targeting producing in almost the same amount of in the coming year to June 2021.

The company indicated that it has also increased its capacity which has been boosted by optimisation of equipment that will see output slightly going up by five percent. Mimosa Mining spokesperson Ms. Elizabeth Nerwande said the company has largely been able to meet its production targets, despite the Covid-19 pandemic.

“Our target production for platinum was 123 000 ounces. The target was achieved for the financial year ended June 2020.
Mimosa has largely been able to meet its production targets, despite the Covid-19 pandemic. This follows granting of essential services status to the mining industry by the Government. This allowed us to continue production while observing protocols to avoid the introduction and spread of Covid-19 in the workforce,” she said.

Ms Nerwande said Mimosa has also optimized the use of its equipment enabling to ramp up production.

“We have not changed our production targets. We will aim to produce at the same level going forward. Mimosa produced 123,000 ounces of platinum in concentrate for the financial year ended June 2020. Mimosa’s current production capacity is 120,000 ounces of platinum in concentrate per annum,” she said.

Ms. Nerwande said the company has also put in place measures to respond to the threats of Covid-19.

“We have not adjusted our production target as a result of the coronavirus pandemic. We are confident that the response measures which we have put in place are adequate to safeguard the health and well-being of our people, thus allowing us to produce to capacity,” she said.

The Sunday News

Bindura Nickel Corporation (BNC) may have to rethink its smelter restart plans given the poor outlook of global nickel prices.

Initially, the smelter project was halted owing to low nickel prices, which made the plan unsustainable.

Twelve months ago, nickel prices hit a 16-month high of US$16 000 per tonne on the London Metals Exchange (LME).

At the time, market watchers even forecast the price to climb to US$70 000 per tonne over the next three years.

However, due to Covid-19, base metal prices, in general, have taken a knock.

Global economic data aggregator, Trading Economics, projects a significant decline in prices by year-end.

“Nickel is expected to trade at US$13 051 per tonne by the end of this quarter,” according to Trading Economics global macro models and analysts’ expectations.

“Looking forward, we estimate it to trade at US$11 406/t in 12 months’ time.”

Stockbrokers and market analysts Morgan & Co say the weakening nickel price may not be entirely caused by the pandemic, as anticipated increased demand due to electric vehicles (EVs) may not be as significant as expected.

“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 manufacturers.

“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,” said Morgan & Co.

“We note that nickel is generally the weakest of the so-called battery metals. Only 6 percent of output goes into batteries and nickel is still mainly a steel play (more than two-thirds is used in steel). Nickel is more tied to outlook for China’s economy.”

Nickel is essentially used by China to make nickel pig iron (NPI), a raw material for stainless steel production.

Commodities experts Wood Mackenzie have predicted an increase in nickel demand from EVs from 128-kilo tonnes (kt) last year to 265 kt by 2025 and 1,23t in
2040.

However, over that period the share of global nickel demand taken by EVs is expected to increase from only 4 percent in 2018 to 31 percent in 2040.

Growth in demand for nickel from EVs will take a long time to reach sustainable levels as a result.

For BNC’s short- to medium-term goals, this time span is too long.

Analysts S&P Global Economics have also lowered their short-term nickel price expectations.

“(W)e continue to expect the pandemic’s impact on global primary nickel demand to overcome supply-side support from
the additional negative pressure that the Philippine mining suspensions will have on China’s primary nickel output,” they said.

“In our Nickel Commodity Briefing Service report for April, we increased our forecast for the 2020 primary nickel market surplus to 48 000 tonnes from 11 000 tonnes previously, which would be the market’s first surplus since 2015.

“We, therefore, further slashed our 2020 average LME three-month nickel price forecast to US$11 915/t from US$12 036/t, a decrease of 14,7 percent year-over-year.”

BNC had earlier hinted that the rationale for the smelter was the need to get higher prices of nickel in leach alloy than nickel concentrate, including potential for an increase in revenue by between 15 and 20 percent per tonne.

The Sunday Mail

Chinese diamond mining company, Anjin has halted operations after an unconfirmed number of sta members reportedly tested positive for Coronavirus including its top management.

Reports coming from the ground indicate that at least two workers, one from top management and another working in the plant tested positive and the company has since instructed its workers to down tools.

A well-placed source who spoke on condition of anonymity said as workers they are terrified and in panic as they feel that they are exposed to transmission due to the company’s poor ablution and sanitation facilities.

The source said besides routine checks temperature checks and sanitization, workers have no personal protective equipment, while social distancing protocols are difficult to follow as they live in groups of eight.

“We have been told to stop operations because there are some people who tested positive for the virus. At least two people have been affected one from the plant and the other is from Human Resources, but we are afraid that more persons could have been affected.

“We have at least twelve persons who could have been affected in both night and day shifts because the ones who tested positive were in contact with others during their shifts.

“So far there is no communication from the management they are just silent. We have only been
told to stop working,” said the source.

“We are afraid and concerned that we will perish if there is nothing done on the ground.” Workers have also been told to keep this information under wraps by management which has a strict non-tolerance for workers divulging inside information.

Anjin company interpreter Progress Gwenzi declined commenting on the incident saying he was not directly on the ground and was waiting for confirmation on the ground.

Gwenzi, when contacted for a comment said he had no information as he was tied up in company meetings but he was later not picking up his phone.

“I am currently in a short meeting I will get back to you with regards to that information. I am still trying to establish the facts from the ground, once I get more details I will update you,” said Gwenzi.

However, sources on the ground say a health team has been dispatched on-site to test the workers who are on shift today amid fears that the numbers could spike as the company’s handling of the Coronavirus is shambolic.

The Bocha Diamond Community Trust (BDCT) has already expressed concerns that they could be exposed as a local community to the Covid-19 pandemic owing to alleged weak responses diamond mining companies.

In a statement, the Trust alleged that Zimbabwe Consolidated Diamond Company (ZCDC) handling of the deadly pandemic was lax and could unleash the virus into the community which mingles with its workers.

“ZCDC is promoting the unrestricted movement of massive numbers of people from other provinces to the Marange community. This is due to the fact that more than 80% of ZCDC workers at the diamond mine come from outside Manicaland.

“These workers are highly mobile as they frequent their homes during weekends, majority of the musing public transport. These mobile workers mix with our community thereby unfairly exposing our community to the coronavirus,” read part of the statement.

263Chat

The Bocha Diamond Community Trust (BDCT) has expressed concern over the exposure of the Marange Community to the Covid-19 pandemic owing to alleged weak responses by the Zimbabwe Consolidated Diamond Company (ZCDC).

In a statement, the Trust alleges ZCDC is threatening to unleash the deadly pandemic into the Marange community through its poor handling of Covid-19 cases and lack of contact tracing,

“ZCDC is promoting unrestricted movement of massive numbers of people from other provinces to the Marange community.

This is due to the fact that more than 80% of ZCDC workers at the diamond mine come from outside Manicaland.

These workers are highly mobile as they frequent their homes during weekends, majority of the musing public transport. These mobile workers mix with our community thereby unfairly exposing our community to the coronavirus,” read the statement

The Trust called on the Diamond mining company to alert the community on any outbreak than to have the community find out for themselves.

“ZCDC needs to be proactive in alerting the community on any outbreaks of Covid-19 among the mineworkers. If this information comes to the awareness of the community through other means which are unofficial then the community verifies the claims to be true, it will appear as if ZCDC is hiding away from community awareness the existence of an outbreak of Covid19 among its mine workers.

“Such verification of unofficial reports happened on the 11 of August 2020 when a joint operation Taskforce of community monitors from Bocha Diamond Community Trust (Moses Mukwada and Takura Betera), and Marange Development Trust (Malvern Mudiwa) visited the ZCDC premises at Zengeni.

Four workers who tested positive to Covid-19 were said to be quarantined at facilities at Zengeni Business Centre that are highly unsuitable for human habitation.”

BDCT adds “The community monitors heard that at least nine workers were reported to have tested positive to Covid19. Whilst we located 4 of them, we failed to establish the whereabouts of the other ve. ZCDC reluctantly confirmed the cases after persistent calls from the community monitors.”

ZCDC corporate communications affairs manager Sugar Chagonda dismissed the allegations saying the company is complying with Covid-19 regulations.

“In terms of mining regulations and our policies we have got restrictions and we are working with the Ministry of Health. On the ground movement, within and to the mine is regulated there are procedures to that effect even entry into the mines by our employees is restricted.

“We are following guidelines and protocols set by the WHO and we are working with the Ministry of Health and Child Care so I do not understand what that (BDCT claims) is supposed to mean in terms of our operations they are highly regulated.” said Chagonda.

The allegations come at a time the country is grappling with a spike in Coronavirus cases_263Chat