Sabi Gold Mine resumes operations after two years

Munyaradzi Musiiwa, Midlands Correspondent
SABI Gold Mine in Zvishavane is set to resume operations after a local investor, Chandiwana Mining Co-operation injected $26 million into the defunct mine to partner Zimbabwe Mining Development Corporation (ZMDC), an official has said.

In an interview on the sidelines of a mine tour in Zvishavane, Sabi judicial manager Dr Wesley Sibanda said the mine was undergoing renovations after securing funding from the investor and was likely to resume operations in June.

Dr Sibanda said Sabi and ZMDC had formed a joint venture with Chandiwana Mining which has secured funding from foreign investors.

“A local investor has organised its funds from the diaspora and it is going to avail a maximum of $26,1 million to cover debt and equity. The mine closed down in May 2014 due to shortage of working capital and the mine was also debt ridden. Our plant also broke down and we had no money to repair it. We then started looking for potential investors to form a joint venture and inject capital so that we cover our debts as well as repairing the plant.

“We identified seven potential partners and we finally settled for one investor. We sat down with ZMDC, the Master of High Court and the judicial manager and agreed to form a joint venture with the investor,” he said.

Dr Sibanda said the mine will settle its debts that also include workers’ salary arrears dating back to 2014 which has accumulated to over $2,8 million.

“With the availed funds we are going to clear our salary arrears while at the same time we will re-engage the workers in phases. We owe our workers a total of $2,8 million and we owe our creditors about $10 million and ZMDC $12 million,” he said.

Dr Sibanda said the mine was looking forward to completing the renovation by end of this month to pave way for running tests of the plant.

“We are looking forward to resume operations in two months’ time after completing the rehabilitation of mining shafts as well as repairing the mining equipment. We are almost through with shaft rehabilitation. We are also rebuilding and repairing the plant as well as repairing ten jack hammers and they are now ready for drilling. We have repaired the mining equipment.

“In two weeks’ time we would have completed the rehabilitation of the shaft as well as repairing all the equipment required for resuming operations and we are confident that in two months’ time we will be operating at full capacity,” he said.

Dr Sibanda said part of the mine was vandalised by artisanal miners who were trespassing into the mine and blasting into the shafts, damaging the pillars and other infrastructure. He said the mine would also re-engage its workers when they resume operations.

“We are anticipating starting engaging only 100 of them when we resume operations. We will, however, engage the rest as time goes on,” he said.

Sabi Gold Mine, which is the third largest mine in Zvishavane after Mimosa, Shabanie and Murowa Diamonds Mines, used to produce about 50 kilogrammes of gold per year with a total workforce of 420.

However, Mines and Mining Development Deputy Minister Fred Moyo said there were other grey arrears that needed to be dealt with before operations resume at the mine. There were disagreements between ZMDC and Sabi in terms of the modalities and approach of how the mine was going to be run. Deputy Minister Moyo said the agreement had not been fully approved by the Government in terms of cash flows and the model but the management went on to resume operations.

He, however, said the challenges were minor and would not stall the resumption of operations at the mine.

“These are not major challenges. It is two-fold in that the model that was used by ZMDC and the judicial manager are different. I raised questions because I felt the cash flows were not properly distributed. I have instructed them to go and work on that. We want equitable benefit. The second part is that the judicial manager implemented the recovery programme while ZMDC felt that it was premature because Government had not given them permission to go ahead.

However, we will not stall anything,” he said.