RioZim plans US$200m investment

RIO Zim has released its quarterly production report for the third quarter which reveals that total gold production has declined by 29% to 2 925 ounces.
The mining giant however said the outlook for the rest of the year should remain positive given the firm metal prices.

Negotiations with authorities for a conducive investment climate, which will facilitate a US$200m plus investment at Murowa, are ongoing. This investment will result in a 2m tonne per year operation.

Production decreased by 42% during the same period last year to 39,800 carats as the soft, enriched, surface layer has been exhausted.

The average ore grade was slightly down to 3,92g/t compared with 4.03g/t for the comparable period last year though it’s still better than what was achieved last year which averaged a grade of 3,66g/t.

Nickel volumes produced declined 13% to 1,326 tonnes as throughput was reduced to accommodate a furnace overhaul at BCL smelter in Botswana compounded by lost production time due to the damage to the sirosmelt furnace stack.

Murowa production declined in the absence of capital investment to expand the operation.

Production from The Sengwa Coal Mine declined 14% to 54,381 tonnes year-on-year, though it was up 22% from the previous quarter.

The continued viability for the mining sector remains threatened by power shortages and issues of exchange rate, particularly on the gold mining side. Renco and Empress have resorted to importing power directly from Mozambique to mitigate load shedding.

One Step represents a small but viable investment opportunity, with an estimated life of four years and a pay back period of one year.

The Sengwa coalfield has thermal fuel resources that can supply a power station producing of the order of 2000MW or more. The search for partners for this development are ongoing. The fixed exchange rate will negatively impact on profitability (especially gold production) despite the firm world metal prices.

Post published in: Economy

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