HomeBusiness DigestPost Chamber: Chitando retains post

OK rights offer raises US$15m

Mines minister Obert Mpofu was made honourary vice-president post of the chamber.

Chitando has been managing director of Mimosa, part of Aquarius Platinum since October 1  2007.

He is responsible to the board for the implementation of Mimosa’s strategic plan. Chitando joined  Hwange Colliery Company in 1985. In 1990, he joined  Anglo American Corporation Zimbabwe. He joined Zimasco in 1997. Chitando worked as commercial director of Zimasco until September 30  2007.

Chitando has been an executive director of Mimosa since 2002. He completed his college education in 1985.

In his address to the meeting, Chitando said the mining sector was under attack and was generally facing an onslaught from the economics of mining, through unfriendly policies. 

In reference to the new mining fees regime, Chitando said there were two issues bedevilling the mining sector at the moment, firstly that the county has low grade minerals and secondly, the difficulties in mining the ore bodies.

Based on that, Chitando said, the economics would determine the extent to which any ore body would be extracted. But he warned that policies pursued by the country might be deterrent factors.  Any statutory charges that are above the line have a direct impact on changing the ore grade.

“High royalties leave more mining resources behind. Therefore it’s much better for government to charge royalties based on profit after tax to avoid a loss in resources.”

He said the Hunters Road nickel project  was a low grade deposit and therefore, the economics behind the mining made the project development difficultfor any investor.

Chitando said that the mining body intends to work with government towards a practical solution with regards to mineral beneficiation, adding that there was need for the state to approach value addition sectorally. “For example we need to come up with a gold plan, asbestos plan and diamond plan.” said Chitando.

At the ZITF International Business Conference in April, Deputy Prime Minister Arthur Mutambara said that the call by the mines ministry for value addition on minerals was now a tired song because it left out some of the fundamentals required for the process to be a success.

Mutambara said four things were needed for value addition to make sense. First, there had to be an investment in new technology, secondly there had to be capable human capital. The government also had to look for new cash in the form of investors and lastly there had to be a change in the mind set. “Engineers have to move away from just being capable of mining coal for Zesa but have to start thinking big in terms of their ability to build catalytic convertors,” Mutambara said.

Meanwhile, platinum producers have completed the formation of the Platinum Producers’ Association (PPA), a sector-specific lobby group. Formation of the PPA, an association of the three platinum producers in the country and affiliated to Zimbabwe’s largest mining body, the Chamber of Mines, was first mooted this February to deal with issues related to the mining of the metal.

Among the main issues threatening the sector are, the hefty mining royalties after government made a 100%  increase on the charge to 10%  effective 2012, serious liquidity problems, the government’s call for the players to establish beneficiation plants, indigenisation and continued disruption of power supplies.

“As a chamber we have formed the sub-sector, Platinum Producers’ Association, to come up with a solution on beneficiation in that sector in partnership with government,” Chitando said.

The country currently has three platinum producers; Zimbabwe Platinum Mines (Zimplats), Mimosa Mine and Unki Mine.

A fourth platinum mine is set to  come on board through an equal partnership between an independent investor and the  Zimbabwe Mining Development Corporation.

Zimplats is currently conducting feasibility studies for a beneficiation plant. Mines minister Obert Mpofu has in the past said miners should partner to start beneficiation projects.  He said government had resolved to maximise return on its mineral wealth by exporting finished products as opposed to raw minerals, adding that the country had also  decided to move from being  a mere resource based economy.

Recent Posts

Stories you will enjoy

Recommended reading