adminGolden Sibanda Harare Bureau
HWANGE Colliery Company has requested Zimbabwe Power Company to back its application for a $7,5 million loan from Agribank meant to double coal production to about 300,000 tonnes. Chief executive Thomas Makore said the company requires significant working capital to increase production from the 150,000 tonnes to 300,000 per month to meet demand from ZPC.
“What we discussed with ZPC is that we need them to pay us on time so that we’re always able to procure working capital inputs, that’s one. The second part is that we also worked with them on getting a loan facility from Agribank,” he said.
The Hwange Colliery CEO made the remarks in an interview with the Herald Business at the 57th edition of the Zimbabwe International Trade Fair, which ended in Bulawayo on Saturday last week.
Makore said since mining is capital intensive, his company had asked the power utility for support in terms of securing money for working capital. ‘‘As such, they’re going to do a prepayment for coal and we’ll use that to pay for expenses, fuel, lubricants and all other inputs that go into production,” he added.
The Hwange CEO said if the plan works out well the country’s oldest coal mining company would be able to boost output to meet ZPC’s growing demand, especially ahead of the winter period.
“The facility we’re looking at right now is about $7,5 million. What Agribank is doing is that they’re doing a facility between us and ZPC. We’re hoping that it will be available anytime now, hopefully by the end of this week,” Makore said.
Makore said once the funding is secured, the company is hopeful that it would be able to raise production in the next month.
Commenting on challenges around recently acquired equipment, especially excavators purchased from India, Makore said they had rigorous discussions with the supplier to resolve the problems of the equipment, which regularly broke down.
“They sent spare parts to fix technical costs at their own costs and they also extended warrant on those machines. Initially it was 2,000 hours but they’ve extended to 3,000 hours or by a further six months, whichever is earlier,” he said.
Further, BML of India, which supplied the equipment under a $32 million recapitalisation programme, have sent through technical support team, now on the ground monitoring the situation.
“So once we have this working capital we’ll be able to test the equipment and check whether it’s able to perform to specification.”He said problems around the equipment came after the company started buying equipment from other suppliers across the world, including India and China as opposed to when they used to buy from Caterpillar and Hitachi, who have much higher depth of experience compared to the current suppliers.
Online Reporter