Why there are no takers for Shabanie and Mashaba Mines


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Three government ministries are currently involved in running Shabanie and Mashaba Mines making it difficult for any potential investor to know which one to deal with.

Deputy Mines Minister Fred Moyo said that the mines were currently being administered by the Ministries of Justice, Legal and Parliamentary Affairs; Finance and Economic Development; and Mines and Mining Development.

“You can imagine that if you have investors who are trying to discuss putting their money into the business. That tripartite that you are discussing with three different ministries can create hesitation on those who would like to invest into the mines,” Moyo said in response to a question by Senator James Makore on what the government was doing about the mines which were a big employer.

Moyo said the mines employed about 7 000 and therefore sustained about 70 000 people. He said there was still demand for asbestos in India, the Arab World and Russia but Russia was also a large producer of asbestos.

He said that although the United States had stopped using asbestos, its space programme had to use asbestos for insulation in high temperature vehicles that they use for space programmes.

 

Q & A:

 

SENATOR MAKORE: My question is directed to the Deputy Minister of Mines and Mining Development. Shabanie and Mashaba seem to be deteriorating day by day. I want to find out from the Minister because this used to be a giant employer in Zimbabwe. What is the problem with these particular mines? Is it because of markets?

THE DEPUTY MINISTER OF MINES AND MINING DEVELOPMENT (MR. MOYO): Thank you Mr. President. I confirm that it is certainly a tragedy that we have got these two mines remaining on closure mode. I say so because the mines employ a total of 7 000 people. Normally, you give a figure of 10 dependants per employee, either directly or indirectly. So we are looking at close to 70 000 people who will have been affected directly or indirectly by the closure of these two mines. The mines are affected by a number of issues. The market is one in that the footprint of the markets has changed. We find that the consumption of asbestos today is largely in India, the Arab world as well as in Russia. North America has stopped using asbestos except for America’s Space programme which has to use asbestos in order for them to make sure that insulation on high temperature vehicles that they use for Space programmes are protected. Asbestos is the best material that is suitable for this kind of work.

We have India that is ready for our market; big consumers like Iran, Iraq and Turkey who are ready for our products. Russia is the biggest consumer, Kazakhstan – as I said, but they are also the biggest producers. The market is there, although limited. Luckily, these countries that are still consuming asbestos are countries that are friendly to Zimbabwe. The mines are old and they are using old technology. Shabanie, for instance is now over a kilometre into the ground. So it demands a lot of new technology in order to keep it running. Because of the corporate or ownership difficulties that the mines have gone through, investors have not found it easy to come on board. At the moment, the business of the mines falls into three categories because they are under re-construction.

Re-construction means they are under the Ministry of Justice, Legal and Parliamentary Affairs and other aspects of it are under the Ministry of Finance and Economic Development and then the technical side under the Ministry of Mines and Mining Development. You can imagine that if you have investors who are trying to discuss putting their money into the business. That tripartite that you are discussing with three different ministries can create hesitation on those who would like to invest into the mines.

We have attempted to say to consumer markets, ‘would you like to put money into the mines and then you pick all the products that we produce?’ That has not been easy to achieve. As late as today, I was having discussion with other potential funders. We are now trying to target on Gaths Mine which is still shallow, 700m from the surface and also cheaper to run versus Shabanie Mine. We will have a detailed meeting next week. We have had similar meetings where we thought we were now going for it and it has fallen through. So I do not want to sound too optimistic except to say to the Senate, we are aware of the distressed communities that are around these mines. We are aware of the expectations of the nation, that we open up these mines and we are aware and accept our responsibilities as the direct Ministry that is supervising the business of these mines. We will do everything in our power to ensure that we open the mines. The longer they take, the more difficult it is to open them in the future.

I want to register the Ministry’s appreciation to the Ministry of Energy and Power Development who have continued to give us power to keep the mines dry without us being able to pay them any money at all. They require a US$100 000 a month to give us power to pump the mines. I think at the moment, we are completely failing to give anything Shabanie Mine is basically a few meters away from submerging equipment.

When you open up mines, you break up your equipment into pieces and take them into the mine. You then put them together and you cannot suddenly bring them out because they are bigger than the opening that is going into the mine. What we did was to bring equipment to the highest levels of the mine but water is fast catching up and we are only a few meters away from submerging the equipment. If we do, then all the electrical equipment will be dead. That is the challenge that we are faced with at the moment.

On the stock of Turnall in Bulawayo, it will only consume a maximum of 10% of what the mines will produce. I have said this because sometimes the public thinks that Turnall can be a market. It is a very small market compared to the capacities of the mines. Those mines can produce close to 200 000 tonnes of fibre per year and Turnall consumes only 10% of that. That is the challenge that we have Mr. President. Thank you.

(263 VIEWS)

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Charles Rukuni
The Insider is a political and business bulletin about Zimbabwe, edited by Charles Rukuni. Founded in 1990, it was a printed 12-page subscription only newsletter until 2003 when Zimbabwe's hyper-inflation made it impossible to continue printing.

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