daniel chigunwe
Business Writer
HCCL Holdings, formerly Hwange Colliery Company Limited, is set to diversify into power generation with plans on course to construct a 50-megawatt power station at its expansive coal concessions in Lubimbi, acting managing director William Gambiza said.
The new venture marks the third phase of the ongoing US$50 million underground mining project, implemented in partnership with a Chinese company, Zhong Jiani Investment (ZJI).
Full-scale coking coal production from the underground mine is anticipated in November this year, followed by the installation of a coke oven battery next year.
To streamline operations, HCCL has undergone a strategic restructuring, forming seven independent companies.
The power project will fall under the purview of Hwange Lubimbi Energy Company, a newly established subsidiary.
Other entities under HCCL are Hwange Mining and Processing Company, Hwange Property Company, Hwange Medical Company, Hwange Zambezi Agriculture Company, Hwange Khula Fund, and a joint venture with ZJI for the new underground coal mine.
“We are currently developing the underground mine and establishing the necessary mining infrastructure, including a wash plant,” said Gambiza.
“Subsequently, we will introduce a coke oven battery in the second phase, leading to the construction of the power station in the third phase.”
While the budget for the power plant is still under development, Gambiza revealed that potential partners from the Democratic Republic of Congo have expressed interest in the project, although discussions are in the preliminary stages.
Gambiza also said the phase two project (the coke oven battery) and the phase three project (the power plant) would be partially financed using revenue generated from the underground coking mine.
HCCL’s proposed power plant aligns with Zimbabwe’s broader push to expand power generation. The country has been grappling with chronic power shortages, which have hindered economic growth.
To address this, the Government has embarked on several initiatives to boost power generation capacity, primarily through the expansion of existing thermal power stations like Hwange and the exploration of new coal bed methane projects.
Zimbabwe currently generates an average of 1 200 megawatts of electricity, with approximately one-third produced at Hwange thermal plant, largely due to the contribution of new units 7 and 8.
Kariba hydroelectric plant output has been significantly reduced to an average of 280 megawatts, compared to its potential of 1 050MW, primarily due to declining water levels at Lake Kariba.
The shortfall has resulted in widespread and prolonged power cuts, severely impacting businesses and the economy.
The coal miner is experiencing a palpable resurgence after undergoing reconstruction and implementation of a strategic Business Improvement Project.
During a recent media tour of HCCL’s operations in Hwange, Mr Gambiza highlighted the company’s successful journey from past challenges to a positive upswing. The positive trajectory, he said, is evident in both increased production and revenue generation.
During the first six months of the year, the company recorded output of nearly two million tonnes and revenue of US$87 million.
The financial turnaround has not only bolstered HCCL’s operations but has also allowed them to invest in crucial capital projects. These strategic investments further solidify the company’s path toward sustainable future growth.
In addition, HCCL has made significant progress in settling outstanding debts, successfully paying off the majority of its creditors.
Bongani Ndlovu