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Green Fuel in ownership talks with government

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GREEN Fuel yesterday said it was negotiating with government to regularise its compliance with the country’s indigenisation laws despite the government’s meagre contribution of $37 million against the ethanol producer’s $332 million capital injection in the joint venture.

BY EVERSON MUSHAVA
CHIEF REPORTER

The company’s director Willard Mbona told the Parliamentary Portfolio Committee on Youth, Indigenisation and Economic Empowerment that although they had injected more money into the business than the government, they remained committed to cede 51 % of its shares to the State.

“We are in a process of negotiating to enter a joint venture with the government of Zimbabwe. The negotiations are on the basis of the contributions brought by both parties (Green Fuel and government) as quantified in December 2013,” Mbona said.

Green Fuel had been summoned to explain its level of compliance with the country’s indigenisation and environmental laws.

Initially, Mbona claimed that his company had complied with the indigenisation policy, but later admitted that they were still negotiating the shareholding structure with government after committee chairperson Justice Wadyajena asked him to produce proof of his company’s compliance.

He said the government’s $37 million contribution was in the form of immovable assets and the value of land.

“Using the discounted cash flow method, Macdom and Green Fuel have contributed $332 million dollars to the project,” Mbona said.

Graeme Smith, Green Fuel general manager, said the Chisumbanje ethanol project revealed that there was a lot of political interference, adding that the company had a long standing dispute with the Zimbabwe National Water Authority over a $7 million bill that it felt was not realistic.

He also said the $826 000 fee demanded by the Environmental Management Agency for an Environmental Impact Assessment certificate was too high.

He drew comparisons with countries such as Kenya, Zambia and Mozambique that charged less than $100 000.

After being accused of failing to honour the country’s statutory requirements by Nkulumane MDC-T MP Thamsanqa Mahlangu, Smith said his company would pay once the disputes have been resolved, but warned that high statutory fees demanded by government could scare away foreign investors.

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