ZimAlloys, Chinese firms in $2,3m partnership deal
ZIMBABWE Alloys has entered into partnership with two Chinese firms to process the company’s huge stockpile of ferrochrome slag in a deal worth about $2,3 million.ZimAlloys, Zimbabwe’s second largest ferrochrome company in terms of capacity ceased operations in 2008 due to lack of capital, but resumed operations last year.
Last week’s Government Gazette revealed that the High Court placed ZimAlloys under final judicial management on November 27 after it was placed under provisional judicial management on July 24 after the ferrochrome producer’s debt rose to alarming levels.
In an interview with our Harare Bureau, ZimAlloys judicial manager Reggie Saruchera said the company was in talks with a Chinese firm to recover metal from the remaining two million tonnes of ferrochrome slag, for an additional $2,3 million.
“Tests have already been conducted by our Chinese counterparts and the metal recovery results are encouraging. We are finalising the contractual arrangements so that the operations under the partnership will start January next year. But at the moment we cannot reveal the identity of our partners because that may jeopardise the course of the negotiations,” Saruchera said.
“We are focusing on strategies to build our capacity to beneficiate rather than export chrome ore in line with Government policy. In that regard efforts are underway to find a suitable investor to recapitalise the business.”
Chinese companies have been heavily investing in ferrochrome for the past two years and recently Afrochine Africa completed the construction of ferrochrome smelter plant in Selous for $25 million.
He said ZimAlloys is expected to increase production to 400 tonnes per month with a turnover of $3 million per year by next year.
Saruchera said once all the projects are implemented the company is going to double production targets by next year.
He said frantic efforts were being made towards the upgrade of its Lalapanzi plant near Gweru, a move that will see the company increasing production to 7,000 tonnes per month.
“Negotiations are in their final stages and the necessary equipment will soon be moved to site to begin operations,” he said.
Saruchera said the upgrade of the heavy media separation plant at Sutton Mine in Mutorashanga was also going underway as soon as ZimAlloys looks set to increase its capacity utilisation.
He said a technical team of partners are currently carrying out a technical assessment of the needs at Sutton mine. In a report that Saruchera presented at the High Court last year, he said as part of the ferrochrome producer’s medium-term plans, a South African mineral processing firm, Specialised Metallurgical Projects, would extract some chrome metal from half of Zimbabwe Alloys’ slag dump, which is estimated at four million tonnes.
Therefore the company is in the process of finalising with its technical partners the most efficient way to process the dump.