A consortium of Zimbabweans living in the Diaspora and local mining engineers have partnered with the Zimbabwe Mining Development (ZMDC) with a view to inject $40 million to resuscitate three gold mines owned by the government mining company.
BY FIDELITY MHLANGA/ELIZABETH DUMBRENI
ZMDC owns Jena (Silobela), Sabi (Zvishavane) and Elvington (Chegutu) gold mines.
Mines and Mining Development deputy minister Fred Moyo confirmed the consortium had signed the memorandum of understanding (MOU) with ZMDC to invest in the defunct gold mines.
“When you start negotiating you start by doing the MOU and that has been done, the engineers have been to the mines and have seen the mines,” Moyo said.
“They have a working committee in South Africa. We will see them when we go as ministers to South Africa on July 3. They have an offer to a joint venture.”
The consortium is set to raise $20 million from internal resources and possibly get an additional $20 million funding from banks, Moyo said.
The mines have over the years been saddled by lack of working capital, creditors, ageing equipment, intermittent power supply, inadequate funding of exploration activities, among other constraints.
Elvington Mine was closed in 2003 and Sabi was shut down last year.
ZMDC acting-general manager Wilson Chinzou last year told the Mines and Energy Parliamentary Portfolio Committee that $30 million was needed to resuscitate the mines. Moyo said the needed capital was not fixed as it could be influenced by the level of capitalisation, technology required and quantities of gold expected to be produced.
According to Moyo, the mines have the capacity to produce a combined output of 120kgs per month.
Moyo added that this gave an impression that Zimbabwean were confident to invest in their country to enhance economic development, adding that those with agricultural expertise could partner Agricultural Rural Development Agency.
ZMDC has been accused of neglecting the gold mines and devoting more attention to its investments in the diamond mining in Marange.