LONDON Stock Exchange-listed firm Contango Holdings has set a target to produce 200 000 tonnes of coking coal after taking delivery of a coke washing plant at its Matabeleland North-based Lubu project.
Contango is the firm spearheading the development of the Lubu Coal project in the Hwange district of Matabeleland North.
The construction and assembling of the plant is estimated to take three to four weeks.
“The company is pleased to report that the wash plant arrived at site on February 3 2023, and has been unloaded ahead of assembly. The wash plant site and foundations were prepared in anticipation of its delivery, therefore construction and assembly is expected to take approximately three to four weeks, with commissioning following thereafter.
“Once calibrated and operating efficiently the wash plant is expected to be able to produce 20 000 tonnes of washed coking coal per month”, the company said in a statement.
In addition to the wash plant, the company is expecting a delivery of a surface miner with a capacity of 2200mm of capacity width and potential of mining 500 tonnes per hour.
“In addition, the company also expects to take delivery at site of its surface miner (Wirtgen 2200SM) in the coming days. The surface miner has a cutting width of 2 200 mm, ideal for selective mining, and can mine up to 500 tonnes per hour.”
The company last year forecasted to conclude the first phase (concept/pre-feasibility) of the due diligence exercise in the first quarter after which they would decide what to do with the subsequent phases of the project.
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The company is also set to receive a laboratory in the first half of this year and the arrival of the laboratory, the new mining machine and the wash plant creates room for more productivity.
“The laboratory is also expected to arrive on site in the first half of this year. Following its delivery, all significant capital items will be at site enabling the company to ramp up activity ahead of first production and sales at the end of the first quarter of 2023,” the company said.
Contango Holdings last year signed a non-binding Memorandum of Understanding (MoU) with a leading multinational company (MNC) in respect of its Lubu Project.
The MoU outlined a framework for collaboration across not only coking coal but also the manufacturing of coke.
While Contango did not mention the name of the partner, there are media reports that the potential partner is a subsidiary of Tsingshan, one of the world’s biggest stainless-steel companies, building a steel plant near Mvuma
Coking coal is a key ingredient in steel production.
Contango noted that it was in preliminary talks with a potential partner with “a sizable footprint in Zimbabwe and is planning to construct a US$1 billion carbon steel plant in the country”.