HARARE-- The Zimbabwean mining company, RioZim Ltd, says it needs at least 125 million US dollars to extend the lifespan of its Murowa diamond mine by an additional three years, and to push output beyond one million carats per annum.
The Murowa mine is located about 60 kilometres south of the mining town of Zvishavane in Midlands
Province. RioZim, formerly knowns as Rio Tinto Southern Rhodesia Ltd, is a listed local independent mining company with interests in gold, diamonds and coal.
RioZim Chief Executive Officer Bheki Nkomo told the Parliamentary Committee on Mines and Mining Development here Monday that the expansion at Murowa would be financed by a mixture of funding instruments.
Going into the future, we are working with a life of mine that ends 18 months from now. As we go deeper into our kimberlitic operations, the cost of mining dramatically increases so hence if we need to extract more diamonds we need to invest more, he said.
To extend the life of mine by approximately another three years, we will need a further investment of approximately 125 million USD into exploration, new greenfield plant, heavy mobile equipment, new staff accommodation plus related infrastructure, electricity and water infrastructure upgrade.
We expect that once this capital expenditure is spent we should witness another 200 per cent growth in output from the current levels.
He said since RioZim took over the mine from Anglo-Australian mining conglomerate, Rio Tinto, in July 2015, Murowa had experienced a 300 per cent growth in production. He attributed this to the successful mplementation of a strategic plan introduced when RioZim assumed control.
Nkomo said in 2015 the mine produced 255,000 carats, while in 2016 production went up to 475,000 carats.
In 2017 we almost tripled the 2015 levels and we forecast that in 2018 we should be able to achieve approximately over a million carats of diamonds.
He said the company expanded Murowa's processing capacity from 70 tonnes per hour to 190 tonnes per hour of ore. We changed the mining model from that of using contract miners to using our own equipment and we experienced significant cost savings. As we talk we have approximately 35 pieces of equipment at the mine," he added.
Over the past three years approximately 45 million USD wereinvested in the mine to extend the life of mine from one and half years to three and half years from 2015, and this money was invested in stripping costs and also acquisition of heavy mobile equipment and was also spent on the expansion of the mine processing plant."
Nkomo also revealed that RioZim intends to invest up to 25 million USD to explore and develop its diamond claims in the Sese communal lands in Chivi in Masvingo Province, covering nearly 3 000 hectares. The claims have been a source of controversy recently, with reports suggesting that RioZim has been failing to develop them since 2000.
A local daily reported on Monday that the Chivi Rural District Council had petitioned the Ministry of Mines and Mining Development in February 2015 over the company's failure to develop the claims and paying mining levy to the local authority.
Nkomo said the company had invested in cutting edge equipment to explore the area. We have already started. A team has been deployed to the site, the equipment that we want to use, some of it is in transit but the initial work has already started. The team has gone on the ground, he said.
We are looking at a total requirement of 20 million to 25 million USD to do the whole thing including where we are actually operating from, because exploration is happening where we are operating from and it is also happening on green fields where we are not operating from and it is also going to happen on brown fields where we have done a bit of drilling and we want to then upgrade the ground to a minable condition.
On allegations that the company was failing to pay its annual mining levy for the claims to the local council, RioZim argued that the law did not require them to pay a mining levy for claims they were not yet exploiting.
Source: NAM NEWS NETWORK