Major breakthrough for Africa’s biggest steel plant

Oliver Kazunga Senior Business Reporter

ZESA Holdings and Chinese firm, Dinson Iron and Steel Company, yesterday signed a joint venture agreement for the construction of a 400 kiloVolt (kV) transmission power line, giving further impetus to the latter’s US$1 billion steel plant currently under construction in Mvuma.

 

A fortnight ago, Cabinet approved the construction of the transmission power line, which stretches for close to 100 kilometres from Sherwood in Kwekwe to the Mvuma steel plant whose first blast furnace is targeted to be operational by September next year.

 

Zesa, through its subsidiary the Zimbabwe Electricity Transmission and Distribution Company (ZETDC), is now expected to start constructing the power line that would feed 500MW to the steel plant.

 

Under the joint venture agreement, Dinson Iron and Steel Company (Disco) on the other hand, is expected to provide funding for the construction of the power line.

 

Speaking during the joint venture agreement signing ceremony at the State power utility’s head office in Harare yesterday, ZETDC managing director Engineer Howard Choga said it was heartening that the strategic national project was set to birth the largest corporate customer for the electricity supplier.

 

“I feel greatly honoured to witness this important and momentous occasion of the signing ceremony of the Joint Venture Agreement between ZETDC and the Dinson Iron and Steel Company.

 

“The event finally came after a rigorous exercise of a due diligence conducted by the power utility and the Zimbabwe Investment and Development Agency (Zida) and subsequently the Cabinet authority,” he said.

 

“This is one of the top Public-Private Partnership, which is meant to construct 97 kilometres of a high voltage power line that will connect the US$1 billion iron and steel plant to the national electricity grid.

 

“It is encouraging that this strategic national project is set to birth the largest customer project for ZESA requiring over 500MW in the next three years, which is equivalent to almost a third of today’s consumption.”

 

Eng Choga commended Dinson for taking heed of the call by President Mnangagwa to invest in Zimbabwe as the country continued to accelerate efforts aimed at reviving and growing the economy.

 

Dinson, is a subsidiary of the Chinese firm Tsingshan Holding Group Company Limited.

 

“The establishment will also see the construction of two large power substations. On the other side, the integrated project comprises a carbon and steel plant, an iron ore mine and a ferrochrome plant, which is poised to produce 1,2 million tonnes of iron and steel per year.

 

“This will be a huge boost to the country’s steel industry and is set to generate thousands of job opportunities at the same time improving the livelihood of the local community (Chivhu, Mvuma Manhize area).”

 

Eng Choga said Zesa as a group was cognisant of the fact that electricity was a key enabler critical for the attainment of Vision 2030, National Development Strategy (NDS) 1 and 2, critical to the realisation of the Government’s desire for development that leaves no one and no place behind.

 

He said ZESA was clear about its role in towards attainment national vision, which entails improving the supply of and access to electricity from the existing 52,29 percent to at least 72 percent by 2030.

 

“The transmission and distribution wing of the power utility has forged many strategic partnerships to address electricity challenges and this is one of them, which is expected to address the developing demands of electricity in the country.

 

“End-User beneficiation projects that include making use of our existing powerline to roll out data/internet to electricity users, especially to rural areas which we term Rural Datafication.

 

“This will go a long way in benefiting the local communities, schools, and clinics amongst other local activities,” said Eng Choga.

 

On employment creation, the ZETDC boss said at full production the project was expected to employ at least 5 000 direct employees while creating further employment opportunities downstream of the chain across diverse fields.

 

“The event is worth celebrating as this project will be one of the country’s largest employers whilst making our country the biggest centre for iron and steel production,” he said.

 

Speaking on the same occasion, Disco project manager Wilfred Motsi said with respect to the construction of the power line only, a number of benefits would spin-off to the local communities and the provinces.

 

This, he said, would strengthen the developmental thrust within the devolution agenda through localised development.

 

“We are anticipating that there will be about 300 jobs directly and indirectly created by this transmission line project, and we anticipate that local people will benefit from this.

 

“Let me emphasise that this is an opportunity for both skilled and unskilled labour and we will ensure that 75 percent of staff are locals from the communities adjacent to the power line.

 

“At completion, our power line will augment electricity supplies from the ZETDC while at the same time adding key assets on the books of Zimbabwe’s power utility,” he said.

 

Mr Motsi said the mega-investment whose construction began in June last year was now 20 percent complete.

 

The Environmental Impact Assessment (EIA) for the powerline was done and approved by the Environmental Management Agency while the Forestry Commission has given the investor permission to clear the power line wayleave.

 

On the other hand, the Ministry of Lands, Agriculture, Water, Fisheries and Rural Development has identified the affected farmers and a relocation process is underway.

 

“The equipment for the construction of the power line is already in Zimbabwe. Next week we are going to witness another signing ceremony with a contractor who is going to construct the powerline.

 

“We applied for Special Economic Zone status for the integrated iron and steel industrial park involving the three provinces of Mashonaland East, Mashonaland West and Midlands,” he said.

 

A total of 10 000 people will be employed directly and over 50 000 people indirectly in the steel project.

 

As part of several developmental projects, the steel plant will also see the development of a new town in the Mvuma area.

 

“Already, a concept master plan for the new town is now in place which is adjusted to the steel plant.

“For the local and surrounding communities, a Social Corporate Responsibility Plan is now in place,” said Mr Motsi.