Speaking at Zimbabwe’s second mining Indaba on Wednesday, the chamber’s vice president, Winston Chitando said the country needs the money to ensure that positive growth and viability is maintained in the mining sector.
“Zimbabwe needs about US$5 billion for recapitalisation of the mining sector over the next five years,” Chitando said
“It is important to realise the requirement for investment in infrastructure that supports growth in mining,” he said.
Chitando said of the US$5 billion, US$1 billion would be channeled towards gold production with platinum taking up US$1, 2 billion, ferro chrome US$250 million, nickel US$110 million, coal US$280 million and diamonds US$300 million.
“Most minerals are expected to record increased volumes of production in 2010 compared to 2009,” he said.
Chitando says production could have been higher with the provision of better power supplies and funding.
“The future looks very bright and mining will continue to be prominent. Coal, gold, chrome, iron ore, nickel, and diamonds are expected to be the main attractions,” he said.
Chitando says a stable operating environment had provided better opportunities for planning and execution of projects.
“Investor interest is still high as evidenced by the number of business enquiries for investment opportunities. Supplier-miner relations have improved considerably with some credit being availed to producers,” he said.
According to the chamber of mines, it is estimated that to achieve self sufficiency in electricity, about US$10 billion may be required for the various electricity generating projects including Sengwa and Batoka which will result in an additional generating capacity of 3 000 MW.
“The country has immense potential and is under-explored. Zimbabwe has the second largest known deposit of platinum, quality coal, gold, chrome, and diamonds,” Chitando said.
Chitando said the Chamber anticipates production of ferrochrome for 2010 to be 145 000 tonnes and platinum 8 700 kg while gold is expected to peak at 8 500 kg.
A total of 520 000 tonnes for chrome ore is anticipated this year, which will be 170% higher than last year.
Zimbabwe’s mining sector has been trailing behind the rest of the world in terms of mineral exploration and development and has lost out on major “commodity booms” enjoyed elsewhere mainly as a result of the “lost decade” between 1998 to 2009.
Presenting the mid term- fiscal policy in July, Finance minister Tendai Biti said mining productivity continued to be hamstrung by erratic power supply.
“This has meant that mining houses have not been able to sustain increased production even in cases where they have had limited access to lines of credit in support of recapitalisation,” he said.