The Zimbabwe Mining Development Corporation (ZMDC) has started coal and methane gas exploration in Lupane, Matabeleland North province.
Benard Rinomhota
A few years ago, the government allocated the parastatal, which recently underwent restructuring two Special Grants to explore coal and methane gas.
Mines and Mining Development Deputy Minister Engineer Polite Kambamura said ZMDC has begun exploration work after securing a partner under a joint venture agreement.
“ZMDC found investors for the SGs (Special Grants) and have since signed a joint venture agreement and now the investor is doing exploration.
“The investors for the methane gas project are Sakunda Energy and a South African company,” he said.
Eng Kambamura would not be drawn into commenting much on the time frame of the exploration work in Lubimbi.
However, he said the project is a massive investment that would significantly transform Zimbabwe’s economy in sync with Vision 2030 where the government aims to achieve an upper-middle-income economy status.
Contacted for further comment, ZMDC general manager Mr. Blessed Chitambira said he was not authorised to talk to the Press.
“I am not allowed to talk to the Press,” he said.
It is estimated that Zimbabwe has 40 trillion cubic feet of potentially recoverable gas in the Lupane-Lubimbi area.
The development of the Lupane coal-bed methane gas project has the potential to boost the country’s energy generation capacity.
Zimbabwe requires an additional 9 000MW of electricity to achieve an upper-middle-income economy by 2030 and currently, the country’s demand for power hovers around 2 000MW.
Of late, the World Bank has urged the government to develop a clear strategy to extract the gas in Lupane
Besides power generation, there are other investment opportunities which are available in the core and downstream industries from coal-bed methane including the production of a variety of chemicals, fertiliser manufacturing, and gas-to-liquids producing diesel, specialist lubricants, and waxes.
Due to the estimated vast reserves of methane gas in Matabeleland North, companies such as Discovery Investments and China Africa Sunlight Energy are at various stages of implementing initiatives to extract the greenfield resource. However, potential investors have been saddled by challenges such as funding constraints and statutory fees.
For example, China Africa Sunlight Energy’s US$2,1 billion coal and coal-bed methane gas project in Gwayi hangs in the balance due to funding limitations.
On one hand, Discovery Investments recently indicated that its planned multi-million dollar methane gas investment is in abyss as government has invoiced the investor US$16 million in ground rental fees.
This article first appeared in the July 2020 issue of Mining Zimbabwe Magazine