ZPC, Makomo in deal over $15m debt

Spread This News

ZIMBABWE’S leading coal producer, Makomo Resources says it has reached an agreement with the Zimbabwe Power Company over a debt of $15 million for unpaid coal supplies to its thermal power stations.
ZPC’s failure to pay for coal supplied has affected Makomo’s operations and the miner has failed to meet targets in the last eight months of the year, the general manager Samson Mabvira told The Source.
“Makomo Resources has since come up with an arrangement which is working as of now to manage this scenario with ZPC,” Mabvira said, but did not elaborate on the solution.
The miner, which is owned on a 60/40 basis by a group of local and foreign investors, last year overtook Hwange Colliery Company (HCC) to become the country’s biggest thermal coal producer, three years after its establishment.
However, its production has remained at less than 100,000 tonnes per month despite having capacity to produce up to 300,000.
Mabvira said ZPC’s Hwange Power Station has been struggling, affecting the mine’s production.
“Makomo has been producing an average of 91,000 tonnes per month this year in comparison to139,000 tonnes per month in 2013.
This has been mainly due to the depressed off take by ZPC Hwange Power Station during the first half of 2014,” said Mabvira in a written response to questions.
Mabvira said the mine’s $14 million coal washing plant has been running since July, primarily to produce coking coal for local and export markets.
The resuscitation of steel giant New Zim Steel would help drive demand for coal products, he added.Advertisement