ZMDC requires $54m to restart gold mines


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State-owned mining investment vehicle, Zimbabwe Mining Development Corporation (ZMDC) is seeking $54 million to restart its three mothballed gold mines, a report by a visiting British mission has shown.

ZMDC acting general manager, Wilson Chinzou told the first United Kingdom trade mission to Zimbabwe in over a decade last month that the corporation is keen to revive operations at the gold mines to boost bullion output.

Zimbabwe and its former colonial master, Britain fell out with in 2000, mainly over oft-violent seizures of white-owned land to resettle blacks as well as accusations of poll fraud. Mugabe has accused successive British governments of plotting his ouster as retribution for what he describes as necessary land reform.

“ZMDC owns three gold mines (Elvington, Jena and Sabi), two of which are in operation. ZMDC is seeking around US$54 million for the resuscitation, recapitalisation, mechanisation, and the long-term growth and development of these operations,” reads the Zimbabwe Scoping Report compiled by the Foreign and Commonwealth Office.

In July, Chinzou told a parliamentary portfolio committee on mines and energy that Runoff Mine, which is under Sabi, suspended operations at the end of May due to low production with employees being sent on unpaid leave. The mine employs 420 workers.

Mine property was also attached by creditors who are owed $7.4 million while power utility,  Zesa cut power at the mine over a $1 million debt, resulting in the mine flooding. Its assets are worth $12.7 million while current liabilities stand at $17 million.

The mine has capacity to produce 45kg per month and requires $15 million to recapitalise.

Elvington Gold Mine, which used to be ZMDC’s biggest gold producer but was mothballed in 2003 following the collapse of a mine shaft, requires $13 million to resuscitate operations.

Currently the mine is conducting sand retreatment at two dumps.- The Source

(102 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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