HomeBusiness DigestPost Chamber: Miners reduce Zesa’s Mozambique debt

Post Chamber: Miners reduce Zesa’s Mozambique debt

The  Energy ministry permanent secretary, Justin Mupamhanga, told the Chamber of Mines  annual general meeting that Zesa paid the US$35 million in the second week of  last month to help clear the debt.

 

Mupamhanga said: “The power utility is making all efforts necessary to reduce the debt.”

HCB agreed to ensure uninterrupted power supply in the interim if Zimbabwe reduces its debt to below US$40 million. The power utility owes US$76 million. 

Mupamhanga said pre-paid meters will be operational in the next two months.

He also said the ministry had shortlisted six international mining companies to tender for the rehabilitation of Hwange Thermal Power Station’s units 7 and 8. The expansion of Hwange Thermal Power Station’s units 7 and 8 would bring 600MW on the national grid

He said that  the six firms, which he did not name, will submit their bids to the Zimbabwe Power Company (ZPC) for  final adjudication.

ZPC has since signed a US$230 million Memorandum of Understanding with Indian power company Wapco Ltd to refurbish the country’s three thermal stations.

Mupamhanga also said government was providing US$1,5 million for a solar project while cooperating partners will come in with solar water heaters as a way of boosting the energy sector. 

In its annual report, the Chamber of Mines notes that electricity supply remained a problem. The arrangement to provide reliable supply to selected customers, who in turn paid a premium tariff, operated reasonably well during the year.

However, those on the scheme complained about the high tariffs applicable to the scheme.  Some of the mines could not access electricity on the scheme due to the absence of a dedicated transmission infrastructure.

With the electricity-suppressed demand surpassing supply,  development efforts in the mining industry will be seriously affected. New projects are unlikely to take off and if they do, the extent of demand management will be severe for those that are not able to participate in ring-fenced contracts with Zesa. The long lead times for electricity generation projects means that the investment commitment to develop a power station to resolve electricity supply challenges will only bear fruits in the next three to five years.

“The immediate solution is to  negotiate with regional electricity suppliers for increased power supplies. This should be a national priority,” said the Chamber of Mines in its annual report.

Due to the growing concerns over  uncertainty and unavailability of power, the Chamber formed a partnership with the Confederation of Zimbabwe Industries to pool resources  and put  pressure on Zesa Holdings and its subsidiaries not only to gain more information on the problems facing the authority, but to also assist in devising more pro-active strategies.

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