Hwange offered $11m by Indian bank

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CASH-STRAPPED coal miner, Hwange Colliery Company Limited (HCCL) is seeking an $11 million line of credit from India to boost production, the mines minister has said.
“They (Hwange) have come to us (mines ministry) to look at the possibility of establishing a line of credit which they have been offered by the Indians.
“We have agreed to them accessing the $11 million for the purchase of equipment which will strengthen their capital base and enable them to do much more mining,” Mines minister Walter Chidakwa told the Senate during a question and answer session recently.
Reports suggested that the loan facility had been offered by Export-Import Bank of India.
Chidakwa said a team from the company visited India two weeks ago to look at the equipment.
“I hope that by giving them that capital equipment, they will be able to produce much more coal than they have been producing,” he said.
Responding to a question about what government was doing about the plight of workers at Hwange who had gone for about eight months without pay, he said: “The information that I have is that they have been paid something.
“I don’t think it’s a full salary. I understand from the chairman of the board that they have problems with capacity to mine.”
Chidakwa said HCCL, the biggest coal miner in the country, was struggling to recover money owed by power utility, Zesa Holdings which was “taking stuff but not consistent in paying.”
He said he would follow up with the company on the matter.
“It’s an important matter. We must make sure things are properly managed and we get the results that we want,” he said.
Last year, Hwange temporarily sent 1,000 workers – nearly a third of its total workforce – on unpaid leave.
In January, the company signed a $260 million, five year mining contract with Portuguese firm, Mota-Engil.
It is sitting on a debt of $160 million and owes workers more than $14 million.
Government is yet to decide on the $50 million rescue package offered by shareholder and businessman, Nicholas van Hoogstraten last year.
Van Hoogstraten holds a 30 percent interest in the mine, the second largest after the government’s 37.10 percent, and had demanded management control of the company for five years in exchange for the cash.Advertisement