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Value addition and beneficiation of the country’s minerals should be seen as an incremental and gradual “step by step” process and not as an event, Chamber of Mines of Zimbabwe president Mr Alex Mhembere has said.
Mr Mhembere’s assertions come when the Government has demanded that mining firms establish a precious metal refinery in the country to ensure that Zimbabwe gets better returns from the export of minerals. He made the remarks at the ongoing two-day Mineral Beneficiation conference at Elephant Hills Resort.
The conference, which ends today and comes at a time when stakeholders are seized with efforts aimed at turning around the economy, is being held under the theme “Beneficiation: Maximising value from the mining sector”.
The Government has already effected a 15 percent levy on exports of unbeneficiated platinum and plans a total ban on raw platinum group of metal exports by the end of this year, which marks the end of a two-year ultimatum that was issued by the Government.
Mining industry experts say building a refinery would cost US$3 billion, which University of Zimbabwe Economics professor Tony Hawkins said, together with other economic factors, requires a thorough feasibility study to prove whether undertaking establishment of a refinery outweighed the cost of not doing so.
Mr Mhembere said when mining companies undertake exploration and are fortunate to find some mineable resources, they would have value added on the particular mineral four to five times.
“When you complete a bankable feasibility study, you value add by up to 20 times. By the time you complete mine development and are producing a product like gold bullion or platinum group of metals concentrate, you will have value added more than 100 times,” Mr Mhembere told the delegates.
He said where the process of beneficiation ended was not necessarily a technical definition but an aspiration. He, however, pointed that Zimbabwe should be able to sell hardware products and services after minerals mined out.
“In my view, this is the objective of Zimbabwe Agenda For Sustainable Socio-Economic Transformation Asset, moving on a trajectory that uplifts the country from being a producer based on exploitation of natural resources to an economy that in the long term is driven by the sale of services and hardware,” he said.
“A good example would be countries such as Finland, Sweden and Germany, which used to be mining power houses. By the end of the mining era, these countries had successfully transformed to become big time players in the supply of mining and mineral processing technology of these resources,” he said.
He said these countries had transformed into metal based industries producing steel, ships, cars, timber pulp and paper. Finland further diversified its economy and produced electronics, transport fuels, chemicals, mining equipment (Sandvik Mining) metrology and developed information and technology industry.
“We need to ask what policies they put in place? What building blocks did they erect? What can we learn from them as a country aspiring to do the same?
He added the country had achieved much in terms of beneficiation of minerals such as asbestos, nickel, copper, chrome, iron ore and
gold.
Further, he said while the economy slid into trouble over the decade to 2008, some of the facilities remain intact and what Zimbabwe needed to do as a country was to retrace its footsteps and bring the dormant facilities back to life.
“The two baby minerals in the country are the PGMs and diamonds, and for these two there are tremendous opportunities to move up the ladder to the next steps,” he said.
He added that the developmental value addition does not end at refining metals, but links with other sectors of the economy such as stainless steel industry, automotive industry, agriculture, chemicals and general manufacturing.
Online Reporter