Sable Chemicals in court over $17m power debt

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Zimbabwe’s sole Ammonium Nitrate fertilizer manufacturing company, Sable Cables, has been taken to court by the Zimbabwe Electricity Supply Authority (Zesa) over a $17 million debt.

The sole Ammonium Nitrate (AN) fertilizer producer is struggling to settle a $22 618 000 power bill debt and has since suggested a payment plan which Zesa, through their lawyers Masawi and partners, have rejected as inadequate.

In papers filed at the High Court under case number 9375, Zesa is demanding $17 337 227 in outstanding bills while its lawyers are claiming 2,5% of the debt as collection fees, thus bring the total to $22 618 000.

But company chief executive officer (Ceo) Jack Murehwa on Sunday professed ignorance over the lawsuit.

“I am not aware that anyone has taken me to court over any debt, please give me more information over the matter,” said Murehwa.

This is despite the fact that Sable Chemicals lawyers Atherston and Cook have since filed an opposing affidavit with the Harare High Court, trying to block Zesa from getting a writ of execution which would allow them to attach company property.

In the affidavit, Sable Chemicals acknowledges the debt, but pleads for time to settle it according to a payment plan discussed by the two parties.

“Defendant (Sable Chemicals) accepts its indebtedness to plaintiff (Zesa) in the amount claimed . . . pleads that on February 2 2011 Sable Chemicals and Zesa entered into an agreement in terms of which Sable Chemicals would pay $4 million by March 24. The defendant pleads that it is not in breach of this agreement and as such the legal action by the plaintiff was premature and totally unnecessary,” reads the defence.

The hefty power bill has been a major headache for the fertilizer company which is now looking for investors to fund a $200 million coal gasification project, which will replace the electrolysis plant consuming 100 megawats every month when operating at full capacity.

A few weeks ago, Zesa switched off the company over unpaid bills, but later restored power after the company undertook to settle the debt.

Sable Chemicals is a subsidiary of diversified conglomerate, TA Holdings.