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Oliver Kazunga Senior Business Reporter
HWANGE Colliery Company Limited (HCCL) is now positioned for improved performance and has no excuse for failure after receiving $31.2 million recapitalisation packages, the Confederation of Zimbabwe Industries (CZI) has said.
HCCL board chairman Farai Mutamangira last week announced that the Zimbabwe Stock Exchange-listed firm had closed two capitalisation transactions — the $18.2 million BELAZ facility funded by PTA Bank and the $13.03 million BEML facility by the India EXIM Bank.
The funding facilities would see delivery of critical mining equipment that will oil the parastatal’s operations.
Yesterday the Acting Indian Ambassador to Zimbabwe Rakshpaul Malhotra said the mining equipment would be in the country next month.
“The agreement has been signed and the machines should be coming in April,” he said.
CZI president Charles Msipa said the closure of financial transactions was a positive development for local industry and export sector.
“That’s a positive development for local industry. The projected increase in output from Hwange is a very positive development both for local industry as well as the planned power plant because there’ll be requirement for more coal, as we understand coal from Hwange is of superior quality.
“We hope that they’ll increase output to the extent that they’ll be able to meet export requirements, produce competitively and support our balance of payments,” he said.
“They’ve really been in kind of financial distress for some time, salary and wage arrears going back possibly a year and getting some funding will help them to really get going because they need to settle salary and wage arrears and ramp up production,” added Msipa.
HCCL has been battling a legacy debt in excess of $160 million in unpaid arrears to workers and other creditors, which has accumulated overtime since 2006.
The mining machinery would include 10 x 130 tonne dump trucks, five front-end loaders with 6m3 bucket each, two wheel dozers, two excavators with 11.2m3 bucket each, two 20,000-litre bowsers, three 6m3 bucket front-end loaders, three bull dozers, three wheel dozers, one motorised grader, one tyre handler and three drill rigs.
Last year, HCCL entered into the Mota Engil contract to minimise and reduce the capital burden at the colliery.
Through the contract HCCL has been doing well as it has cushioned the troubled firm from biting operational constraints.
The company engaged the contractor through an open tender process to produce 200,000 tonnes of coal monthly from its open cast operations at Chaba and started producing last August.
Total production by the contractor to date has now reached 996,000 tonnes and this has enabled the colliery to work on stabilising its own production while bridging the gap between the purchase of new equipment and the commissioning of the equipment next month and May.
Overall combined production target has been set at a minimum of 450,000 tonnes monthly by the second half of the year, split between HCCL’s own production and the Mota Engil.
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