Hwange Colliery Company Limited (HCCL) has abandoned plans to rebuild its coke oven battery, two years after it floated tender inviting bidders, because the cost of repairing the facility is prohibitive, an official said.
Hwange, which is 38 percent owned by the Government, decommissioned the coke ovens in 2014 after they had outlived their lifespan and became too expensive to run.
HCCL managing director Dr Charles Zinyemba told The Herald Finance & Business that the company was now looking to replace the old coke ovens with new facilities in the short to medium term.
“We have abandoned the idea because it makes more sense and cheaper to come up with a new Chinese-type battery,” said Dr Zinyemba. Hwange had indicated that at least $50 million was needed to build a new coke oven battery that produces high value commodities used in smelting plants, before coming up with the idea of repairing the old facility.
Metallurgical coke is used as a fuel and reducing agent in blast furnaces, as part of the process of making steel or iron alloys.
Last year, Dinson Colliery commissioned a coke oven battery after investing US$30 million. The company, which is a subsidiary of Chinese global investor, Tsingshan Holding Group, plans to produce about 400 tonnes of coke per day.
The firm has already started the construction of the second phase of its project, as the company seeks to deepen the value addition drive, which feeds into Zimbabwe’s Vision 2030 of an empowered and prosperous upper middle income economy.
Prior to the decommissioning of the plant, Hwange, the oldest coal mining firm exported coke to copper smelters mainly in Zambia and the Democratic Republic of Congo.
Zimbabwe is witnessing huge investments in the coking coal sector as investors seek to take advantage of surging demand in China, the world’s largest consumer of the commodity used for steel production.
Locally, the demand is expected to increase on the back of investments in ferrochrome smelting facilities after the Government imposed a ban on raw chrome exports to encourage value addition and beneficiation.
Several other coke projects are in the pipeline and should help Zimbabwe achieve the US$12 billion mining economy by 2023.
Launched in October 2019, the mining road map, known as the Strategic Road to the Achievement of $12 billion by 2023, aims growth in strategic exports of minerals such as gold, nickel, coal and platinum.
The policy focuses on value addition, enhanced investment within the sector, increased productivity and employment creation and increased exports and foreign-currency generation.
The Government says value addition and beneficiation of agriculture and mineral commodities would be the most important part of its policy framework next year as the country seeks to grow exports from the secondary sector.
Last week, the Government banned raw chrome exports to encourage building of smelters.
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