Sunday News reported that HWANGE Colliery Company Limited has presented a USD 115 million budget for recapitalization to the Government as it seeks to improve production.
Mr Fred Moyo MD of HCCL said that the coal mining giant had prepared two budgets that had been sent to the Minister of Finance for approval. The company was seeking USD 25 million for short term recapitalization to increase its production to levels ranging from 60% to 70% within the next 100 days as stipulated by Government under the Short Term Emergency Recovery Plan while USD 90 million is meant for long term projects.
Mr Moyo said that “The USD 25 million does not restore capacity to the required levels but it will certainly improve production. He said that “We also had to adjust our long term recapitalization budget from USD 75 million to USD 90 million to cater for repair of components, replace and rebuild some of the equipment.”
He added that HCCL had to review the USD 75 million recapitalization budget proposed three years ago owing to the fluidity of prices on the international market.
Mr Moyo said that “Attempts to recapitalize the business over the years have been futile because lines of credit were not available.”
Over the years, HCCL’s production levels have drastically fallen owing to lack of sufficient foreign currency to purchase spares for their fleet of broken down machinery.
The STERP document states that coal presents the greatest potential for value addition in the energy sub-sector. In this regard, coal mining companies have been instructed to export coke, instead of the traditional coking coal.
Through availing adequate resources for the use of acquired technologies, the country stands to benefit from increased revenues derived from the by-products of producing coke which include various solvents, tar and with further processes, petrol and diesel.
The bulk of locally produced coal will be devoted to local thermal electricity power generation with the excess power being exported to the sub-region. Furthermore, projects to exploit coal bed methane will be pursued.
(Sourced from Sunday News)
