New Zimbabwe Steel shareholders’ delays in appointing the board have stalled the new company’s revival although Industry and Commerce deputy minister Mike Bimha said the company was ready to take off.
Speaking at the Essar Steel’s community initiative in Chivhu, Bimha admitted the company was yet to start operations as there were several consultative stages the partners had to go through first although the company had already been launched.
“Some of the negotiations were allowed to continue even after the official launch of New Zimbabwe Steel,” said Bimha.
He could not give the exact date when the board, which he said was critical, will be constituted.
“We all have seen it fit now to have a board, as New Zimbabwe Steel is ready to take off. We don’t have the exact date when the next board will be constituted but we will make an announcement soon.”
He added that there was extensive preparatory work that had to done before Essar’s takeover. Essar Steel chief executive officer Mallappabi Sampath admitted they were yet to begin operations at the steel company, but they had commenced extracting ore.
“At the moment will be doing ore extraction and this exercise will take us to June next year,” he said. “After this will be testing and finalising on the profits and consignments to take us to December. In the next three to four years from now we should be operational,” Sampath said.
He said New Zimbabwe Steel was going to have two projects – phases one and two.
“Phase one is expected to produce 0,5 MTPA steel and the phase two will produce 1,2 MTPA steel,” said Sampath.
He said phase one would be the refurbishment of the existing plant within 12 to 15 months at a capital expenditure of $115 million.
Sampath said the major advantages will be on the revival of the raw material handling system, revival of the blast furnace four, revival of coke oven batteries 1, 2 and 3, and the revival of one steel melting plant.
Phase two will have a capital injection of $275 million with completion estimated within three years.
The major revival activities was to increase coke production by commissioning coke oven battery four, revive second steel melting plant, commission oxygen plant, commission waste gas-based power plant to 50 megawatts.