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Finance and Policy  
2 November 2017

Zimbabwe: Colliery to boost revenue via foreign currency

Hwange Colliery Company Limited, which is expected to reach 400,000 tonnes monthly production by December, is now pushing for an increase in export sales to earn the much needed foreign exchange for the company to expand its operations.

Building on the success of Project Gijima, the mining company is planning to replicate the scheme by launching Project Gijima 2 to boost its export sales through selling of underground coal and coking coal to other countries.

According to the Herald Business, the colliery is in an arrangement with both local and international banks to raise around $400 million for the company's total operations.

However, in addition to that Hwange intends to produce abundant coal and coking coal to earn forex.

The company’s managing director, engineer Thomas Makore, recently told the Herald Business that the resumption of underground mining at Project Gijima 2 will finance some of their projects to retool its operations with modern and more efficient equipment and technologies, through selling of some of its produce to South Africa and other nations.

He said Gijima 1's main focus on its 100 Day Rapid Results project, was mainly production and productivity improvement but Gijima 2's focus will be exports among other things.

Underground mining equipment needs foreign currency

Makore noted: "Given the success of the Project Gijima, we launched Project Gijima 2 which will mainly focus on export sales, safety, equipment availability, processing throughput, quality and deliveries to customers.

"Our goal is to increase the contribution of export revenues from the sales of coking coal and industrial coal.”

He continued:  “The rest of the underground mining equipment needs foreign payments. We are working with our banks to mobilise the required foreign currency so that the rest of the equipment is delivered.

"By the end of the year, we expect to have resumed underground mining operations. But more importantly, we need some of our projects to earn forex through robust exports sales as we can't afford accruing more loans when we can fund our projects through these projects.”

Media highlighted that Project Gijima 1's output rose to the current levels of 230,000 tonnes per month from 55,000 tonnes earlier this year.

The company is reported to have entered into two 25 year coal supply agreements, with Zimbabwe Power Company and the other with Per Lusulu power, an independent power producer in Matabeleland North. Read more...

 

Homepage image: Stock

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