HWANGE — Several firms that were granted special mining grants by the government have ignored repeated reminders to start operations and would soon lose their licences, a Cabinet minister has said.
Report by Nqobile Bhebhe
Mines and Mining Development minister Obert Mpofu said most of the 18 firms granted special grants were yet to start mining.
“We have reached a stage where, as the government, we are seriously considering revoking licences we awarded some mining firms,” said Mpofu during Makomo Resources’ second anniversary in Hwange on Saturday.
“As a ministry, we have sent several reminders to those firms, but they have been ignored. It is time we revoke the licenses.” Mpofu did not mention names of the affected firms and the time frame.
Makomo Resources, a coal mining firm, is one of the companies that were granted special mining grants and within six months after being awarded the licence, started operating, said Mpofu.
“Makomo Resources has done a tremendous job and we are pleased with their contribution to the mining sector,” added Mpofu.
The minister said President Robert Mugabe was personally involved in interviewing applicants for special grants and “after a painstaking and vigorous exercise, it is disappointing that most firms are yet to operate”.
Last year, the government issued 20 special coal grants, but most of the projects are yet to take off.
According to a research note by business research and consulting firm Frost&Sullivan, Zimbabwe has coal reserves that will “approximately last the next 200 years at a production output of
5 000 tonnes per annum”.
These coal reserves can be used as feedstock for coal-powered thermal power stations. Coal production in Zimbabwe for 2012, is set to decline by at least 600 000 tonnes from 2,56 million tonnes produced in 2011. The Chamber of Mines estimates that the country’s coal mining industry requires up to $5 billion to recapitalise.
At peak production in the mid-1990s, the country produced over five million tonnes of coal, but since the turn of the millennium, annual output has been hovering between two and three million tonnes.