HomeLocal NewsGovt closing loopholes in diamonds, chrome mining

Govt closing loopholes in diamonds, chrome mining

Interview By Freeman Makopa

FROM Chinese mining firms displacing villagers and setting up operations on sacred sites to bold moves by government to enforce another ferro-chrome exportation ban, 2021 has been an eventful year for the mining sector. To help our readers understand the thinking behind some of the decisions taken by government, our business reporter, Freeman Makopa (FM) this week caught up with Polite Kambamura  (PK), the deputy minister in the Ministry of Mines and Mining Development to explain what the future is for this key industry. He spoke after the Chamber of Mines of Zimbabwe said recently that generally, mining executives were confident about the prospects for their businesses in 2022. Notable among the positive sentiments included optimism about international commodity price outlook that have been bullish throughout this year, as well as improvements in capacity utilisation and anticipated mineral output growth. However, on the negative side, mining business executives said they expected the investment environment to remain depressed, characterised by high cost of capital, among several other setbacks. They said they anticipated foreign exchange constraints and infrastructure deficit to persist in 2022. But Kambamura said the government was setting the ground for a more organised and successful future for the sector. Below are excerpts of the interview:

FM: A key area that has recently been attracting public attention in the mining sector has been developments in the chrome subsector, where miners have complained about poor prices. How is the government addressing this?

PK: The government banned the exportation of raw chrome in order to encourage local beneficiation. The Minerals Marketing Corporation of Zimbabwe is working to establish a minerals counter where the government will enforce standard market prices thus protecting chrome miners against poor prices and unscrupulous buyers. Ferrochrome production is key as we move towards the beneficiation of our minerals. As I said, the government banned exports to encourage local beneficiation. Currently, several smelters are in operation whilst others are still under construction.

FM: Another area of interest has been the establishment of the Diamond Policy. Please share with us its significance?

PK: The main reason why the Diamond Policy was put in place was that we wanted to bring sanity into the diamond sector in line with the Kimberley process certification. Through the diamond policy, we are looking forward to seeing increased production in the diamond value chain. We are looking forward to seeing the beneficiation and value addition of our diamonds. We are also looking forward to seeing orderly mining of our diamonds for the benefit of the nation.

FM: The closed steel production company, Ziscosteel operates in close collaboration with mines like Hwange Colliery Company Limited. Please give an update on current plans to bring Zisco back to production, and possibly address the problems that Hwange has been facing?

PK: Ziscosteel is under the Ministry of Industry and Commerce but the extraction of feedstock to the plant is under our portfolio. Both ministries together with the Zimbabwe Investment and Development Agency are working together to resuscitate the operation and its value chain.

FM: Invictus Energy has been exploring for oil and gas in the Muzabarani District in Mashonaland Central. Please tell us more about this project?

PK: Currently Invictus is doing exploration and the exploration trucks are in Muzarabani. They will be drilling two wells after the exploration phase, probably in the first quarter of 2022.

FM: We have seen the impact of oil projects in Mozambique. And there are clear synergies between Mozambique and Zimbabwe, particularly in natural resources. How are the countries working together currently and are there any further types of cooperation on the way?

PK: Government will be renewing the bilateral agreement that we had with Mozambique and this will seal the cooperation that we already have with Mozambique.

FM: What is the mining sector’s contribution to the economy currently? Have there been changes since lockdowns affected other industries?

PK: The mining sector contributes between 60% and 73% of all exports.

FM: What progress has been made with regards to the long-awaited amendments of the Mines and Minerals Act?

PK: The Mines and Minerals Act is now at the Cabinet Committee on legislation.

FM: What is the significance of the use it or lose it principle and how will this help in improving the operations of the mining sector?

PK: The use it or lose it principle was basically introduced in good faith of bringing to production idle mining claims of economic value. Dormant mineral resources should be mined so as to be of significance to our economy.

FM: How have you dealt with the issue of leakages and smuggling of minerals out of the country?

PK: There is an inter-ministerial committee deliberating on initiatives to minimise current mineral leakages.

FM: One of the biggest mining projects announced recently is being undertaken by Karo Resources. Tell us about progress in the project. Have they been reporting encouraging results?

PK: Karo resources finished their exploration and the results of the exploration were very, very encouraging. So, at the moment, they are working on discussing an agreement with the government, there are some clauses that need to be considered. We are waiting for Karo Resources to come up with something, which is beneficial to both the investor and the government.

FM: The issue of safety has been of great concern in most Chinese-owned mines. What strategies did you put in place to reduce accidents in these mines?

PK: Every mining site should adhere to the Mines and Minerals Act and other supporting Acts of the country which govern the mining industry, regardless of the origin of the investor. We also encourage investors in the mining industry to be conversant with our mining legislation and to employ qualified personnel.

FM: Zimbabwe’s mining sector generally continued operating during the peak of the pandemic, which seems to have been a key element for the economy during this crisis. Could you share with us what led to the decisions that you took?

PK: Mining related organisations were given an exemption to operate under strict Covid-19 restrictions and conditions. We also advised mining houses to make sure their workforce is vaccinated.

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