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Zim Value Addition and Beneficiation reaching USD$12 Billion Mining Economy – Minister Chitando

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''..then we also have gold were we have lots of breaches large scale mining and small scale mining..on the large scale miners the notable projects includes but not limited to shamva mine whose re-opening was graced by His EXCELLENCY. Which will produce up to 5 tonnes Eureka .so far one and a half tonnes a brand new production and lots of expansions in new projects and also lots of increase in the artisanal gold production which we are targeting .we are targeting to have 100 tonnes per annum by 2023 yes admittedly we witnessed a slump in production last year ...BUT Government is working. and looking at the policy framework to see how we can how government can facilitate the production of 100 tonnes per annum of gold...''

Zimbabwe is richly endowed with over 60 different economically exploitable mineral resources including gold, diamonds, platinum group of metals (PGM), Lithium and graphite which the Government has targeted under the USD$12 BILLION DOLLAR MINING ECONOMY to beneficiate and add value to.

Hon Minister of Mines and Mining Development Hon Winston Chitando revealed this to TechnoMag’s Ross Moyo in an exclusive interview THAT Beneficiation and value addition of minerals before export is one of the four key pillars of Zimbabwe’s goal to create value, employment and accelerated industrial development from its largely unexploited mineral resources.Speaking to this journalist Minister Chitando said

”…when we also then have diamonds …were we also have four players being ZCDC, ANJIN, ALROSA WHICH IS COMING INTO PLAY and they have projects in MALIPATI near Beitbridge and in Tsholotsho and one or two other sites which they are moving into..then we have Marowa diamonds who are undertaking a USD$ 450 million dollars expansion project over and above that on the diamond sector we are also looking at the increased beneficiation of the diamonds. ”

Government has initially prioritized diamonds, chrome, PGM’s, nickel and coal bed methane and will utilize the mineral sector and related industries to develop mining input industries and services.Despite losing USD 1,2 billion dollars annually to gold smuggling Minister Chitando is confident that Zimbabwe’s mining economy will reach these heights and even beyond.
In a one on one interview with TechnoMag, Minister Chitando did not waste anytime but rather delved straight into the nitty-gritties towards attainment of his 12 dollar mining industry vision.In his exact words he spoke highly proud of what his Ministry is already and has already implemented stating,


”..the 12 billion dollar mining industry is underpinned by six major minerals plus other activities.. first and foremost its underpinned by huge increase of platinum which is based on three new projects the Karo Resources project which is coming into stream next year then we also have the Great Dyke Investments in Darwendale which is also coming into stream end of next year then…we also have the trafigura project WHICH WILL ALSO BE OPERATIONAL BY 2023..”

Minister Chitando alluded to growth in the sector by key coorporates in the realization of the dreamand said
”over and above that we do have growth and expansion by the 3 current producers being Mimmossa Unki and Zimplats so the PLATINUM SECTOR THE TARGET is premised on a USD$ 3 billion dollar target to achieve the 12 billion and we believe by 2023 that will be in place based on the new capacity and also expansion of capacity by the current producers …”
Beneficiation and Value Addition is of utmost importance in understanding a commodity’s value chain.At the heart of beneficiation lies the primary commodity itself, and possible pathways in that commodity’s value chain. For any beneficiation policy to be effective, it is therefore key to fully understand the steps that are involved in the transformation of raw minerals into a marketable product. Whereas value is added to a commodity at all stages in its value chain, not all stages are equal in their potential to maximise benefits to a country. Moreover, depending on the mineral and the respective end-product, a commodity’s pathway can differ significantly from that of another commodity. Gold for example is a high value, easily transportable commodity AND WHEN IT COMES TO GOLD PRODUCTION MINISTER chitando did not mince his words but rather said,
”..then we also have gold were we have lots of breaches large scale mining and small scale mining..on the large scale miners the notable projects includes but not limited to shamva mine whose re-opening was graced by His EXCELLENCY. Which will produce up to 5 tonnes Eureka .so far one and a half tonnes a brand new production and lots of expansions in new projects and also lots of increase in the artisanal gold production which we are targeting .we are targeting to have 100 tonnes per annum by 2023 yes admittedly we witnessed a slump in production last year …BUT Government is working. and looking at the policy framework to see how we can how government can facilitate the production of 100 tonnes per annum of gold…”
The Minister made it pot and clara that government is hands in glove with all key stakeholders in gold production despite the costly leakages saying gold when beneficiated finds its uses in downstream industries such as electronics or jewellery, whereas iron ore is a bulk commodity that finds its use mainly in steel production. Before considering any interventions, policy makers therefore need to first gain an understanding of that commodity’s value chain, together with the respective inputs that are required at each stage, as well as the related economics. Only after a comprehensive assessment is it recommended that policy makers move to identifying the points in the value chain which are appropriate targets for beneficiation policies.
The Minister of Mines and Mining Development further explained to Technomag in generic terms, value chains can be roughly divided into four steps. He said the first one Ore is extracted. The product is washed, sized or undergoes processing to a concentrate. Depending on the commodity and the extent of technology innovation/automation, these processes are both capital and/or labour intensive. Secondly Minister Chitando said the commodity is converted into a bulk commodity or an intermediate good such as a metal alloy. This process is usually more capital and less labour intensive. The Minister a mining veteran expert went on to say thirdly Conversion of this intermediate product into a refined product follows. After this step, many commodities are ready for purchase by industries, for example by the manufacturing sector. He cited fourthly from this point, the end product is usually a manufactured, ready-for sale produced good that can reach markets and consumers directly.

The concept of value chains, however, often seems simpler in theory than it is in the real world. The inputs and applications of each commodity at each stage of the value chain – from highly technological and expensive to simple low-tech input material – are difficult to catch in their totality. Therefore, attempts to map value chains are at best an abstraction of much more complex processes. Nevertheless, value-adding policy interventions can be undertaken at many stages at which commodities are transformed. Chitando said Zimbabwe as a country stands to immensely benefit from his implementation of beneficiation policies adding that indeed Zimbabwe is striving to keep most of the steps within its territory. Chitando also mentioned this is possible by

”… collaboration with the Zimbabwe Chamber and every other stakeholder singling out big corporates as Mimmosa, Unki Mine and Zimplats as some of those taking on government policy in beneficiation and value addition…”something he says will be a thing to live with even in Zimbabwe’s Diamond sector.Challenged by TechnoMag about why Zimbabwe seems to leg behind in value Addition and benefitting from its own Diamonds like Botswana does using diamond alone as its economic backbone, and why Zimbabwe can not seem to take a cue yet it sits on almost two thirds of the worlds diamonds.

 

Chitando said the two thirds are not necessarily fully factual until mined further expagorrating

”…over and above that we do have growth and expansion by the 3 current producers being Mimmossa Unki and Zimplats so the PLATINUM SECTOR THE TARGET is premised on a 3 billion dollar target to achieve the 12 billion and we believe by 2023 that will be in place based on the new capacity and also expansion of capacity by the current producers …”
Minister Chitando gave examples of Steel and Gold saying each resource has its own value chain and specifications in terms of the four steps mentioned. This will depend on the grade percentage needed by customers and consumers, the inputs needed to produce them and their respective capital and labour intensities.
Chitando spoke about Zimbabwe’s steel industry like Zisco Steel the changes it is going through including Value chain of Steel.He said

”Around 98% of iron ore produced is used in the steel industry. In that sense, there is a close connection between both goods. While iron ore belongs to one of the most abundant metallic elements in the world, steel belongs to one of the most important industrial commodities.”

”Steel has two methods of production, one using iron, the other recycling existing steel. The first method requires iron ore, energy (often coal) and limestone inputs to produce new steel and remove impurities. ”

”To produce 1,000 Kg of steel, roughly 1,400 Kg of iron ore, 800 Kg of coal and 300 Kg of limestone is needed.”

The iron ore is put into a furnace, which is fueled by coke (coal), reacting with the iron ore at high temperatures and producing so-called ‘hot metal’. In a further step, the “hot metal” is again added to a furnace, this time injected with oxygen. Later, the steel can be transformed into different shapes and forms, before being used in manufacturing or other industries such as construction. Although in theory, iron ore can be found in many places in the world, only a few countries dominate global steel output. The last decade has seen China ascend to become the world’s top producer, with almost half the global steel production in 2017.

Value chain of Gold on Zimbabwe is of paramount importance considering that Chitando alluded the Honourable Minister of Home Affairs Kazembe Kazembe’s notion that Zimbabwe loses 100 million United States Dollars worth of gold monthly to smuggling.Like iron ore, gold is geographically spread, with no country accounting for more than 20% of global reserves. Although the Witwatersrand deposit in South Africa is historically one of the largest gold deposits so far discovered, by a large order of magnitude, and South Africa has accounted for approximately 40% of global production to date. Usually, gold is either extracted from riverbeds (“alluvial”) or from cracks in rock formations. Processing, which often takes place on-site, is the time-consuming removal of carbon, oxides or sulphides that are part of the ore. In a second step, the gold is then melted into a “doré” bar, which contains up to 90% gold. The next step, refining, transforms the commodity into a (semi)final product, depending on the use. This product is sold to various industries, with more than 40% being used to make jewellery.

 

Chitando said ”…Then the third mineral which we have is Chrome, Ferochrome mostly which we are targeting that it will contribute a billion USD$ Dollars , there is lots of expansion taking place, the Zimbabwe alloys which is the largest furnace in the country is nearing completion..we have projects by Zimasco..we have projects by AFRONSHIN Jinan all increasing the capacity of Ferochrome production..and we also have the first carbon steel plant in Zimbabwe.The ground breaking ceremony will be in June which will be in Manise in Mvuma which will take 18 months to construct again to contribute to the billion which was earmarked for ferochrome.”

Chitando added ”… then we are also looking at coal and hydro and it has been a massive success where we are looking at new production coming on stream in the Hwange area .I’m sure those who followed would have seen His Excellency last year visiting the projects.There is the South Mine Project which was commissioned by His Excellency last year.There is the Jinan project which is under construction.There is the ZZEE Power Plant , we have got the ZZCC Coke PROJECT THERE.WE HAVE GOT THE JINAN PROJECT.WE HAVE got Afroshin WHO AT THE MOMENT THEY FINISHED CONSTRUCTION OF THE 180 THOUSAND TONNES COKE battery WHICH IS THE BIGGEST IN THE COUNTRY.its automated right now, it was commissioned early April and will start producing some time mid-May.There are also now starting to construct another 180 000 and the subsequent Value Addition of Thermal for the power the coke in coal for the coke batteries, metereological coal for and for industrial coal for use and for export, and again we have a number of associations coming on stream.”

” Zambezi Gas they are working on right now they are processing the power plant, .Afronshin putting a power plant etc…we will exceed the one billion dollars.We also have a lot of other initiatives which include but not limited to black granite.We also have an oil project..So i think we are well on course to achieve the 12 billion dollar mining industry by 2023…”

Ross Moyo

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