Essar’s big plans for Zisco

capacity from one million tonnes of steel a year to 2,5 million tonnes in the next three to four years.
This would result in the setting up of an iron beneficiation plant in Chivhu, where Ziscosteel has mining rights for iron ore, to augment this key input.
Essar gained a 54 percent stake in the former State enterprise two weeks ago after it had acquired 60 percent of Government’s shareholding.
Essar Global chief executive, responsible for mining operations Mr M.K. Sampath, said the expansion would depend on the requisite conditions.
“We will work with Government to put up a power plant (to ensure adequate supply for Ziscosteel increased power needs,” he said.
The revival of Ziscosteel and the plans to expand capacity would require about 350 to 400 megawatts of additional power.
Mr Sampath announced this during a meeting organised by Industry and Commerce Deputy Minister Mike Bimha in Chivhu to report back on the sale of Zisco to Essar.
Chiefs, district administrators, councillors, heads of government departments and the public from Chivhu attended the meeting last Thursday.
Deputy Minister Bimha represents Chikomba West in Parliament. Zisco owns iron ore concessions in the area, which Essar intends to exploit.
Mr Sampath said there was a huge gap between production and demand for steel in Africa, which they could exploit by raising the capacity of Ziscosteel.
But these plans would largely depend on availability of basic infrastructure – an efficient rail system, adequate power supply and other key raw materials.
“The infrastructure should be available – 2,5 million tonnes of steel is not a joke. For instance, this would require 4,5 million tonnes of iron ore per year, around 2,5 million tonnes of coal for coke and a lot of limestone,” he said.
Mr Sampath said he hoped the Government would assist in augmenting the basic requirements to ensure the plans to raise Ziscosteel’s capacity are realised.
Essar will seek coal concessions from Government to ensure adequate supply of coal for coke and its new power plant to be set up in Hwange.
It would also set up a beneficiation plant to process Jaspilite iron ore from Manhidze Range in Chivhu. The ore is difficult to mine and is rarely exploited across the globe, as it requires a lot of money and advanced technology.
The advanced iron beneficiation plant would enable the firm to raise iron content in the ore from the Manhidze range from about 35 percent to 65 percent.
Ideally, iron ore should contain 62 percent to be commercially viable.
“We are going to be the first to exploit it (Jaspilite iron ore) because this group has the technology, resources and the leadership for it to work,” he said.
Deputy Minister Bimha urged the people of Chikomba to support the initiative to revive Ziscosteel, saying this would have several downstream benefits.
He said Essar would relieve Government of more than US$340 million debts, new industries would benefit, while the National Railways of Zimbabwe and Zesa Holdings would be assisted to improve their capacities.
The firm has made a commitment to invest up to US$750 million towards the revival of the steel firm which stopped production two years ago due to financial constraints.
“Essar are serious investors. They did not adopt a wait-and-see attitude. I think they will continue to be serious investors,” he said.
He said he would work with the firm to see how it could assist in developing the Chikomba communities, create jobs and empower local firms and the people.
“We will see if certain services you (Essar) require – such as protective clothing – could be obtained from this area, instead of getting them from Harare or India,” he said.