28 April 2011

Zimbabwe: Fertilizer Manufacturer Suspends Operations

Zimbabwe's sole manufacturer of ammonium nitrate fertilizer, Sable Chemical Industries Ltd, has been forced to suspend operations after the Zimbabwe Electricity Supply Authority (ZESA) cut off power over a US$30 million debt.

A report by NewsDay says most of the workers have now been sent home as a result. Electricity to the struggling company was cut off during the Easter Holiday and had still not been connected by Wednesday, the report said. It's the second time since January this year that power has been cut off over the ballooning debt.

Speaking to NewsDay, Sable Chemicals deputy board chairman Misheck Kachere said the company presented a payment plan to ZESA which it had been following for some time, until it later defaulted owing to cash flow challenges.

In September 2009 the company shut down owing to what it called high electricity tariffs and their impact on running the Electrolysis Plant. Several meetings with ZESA management to revise the tariffs yielded nothing.

At the time ZESA argued that customers like Sable actually paid a lower tariff of US5,6 cents while the rest of the industry paid US7,3 cents for the same unit of electricity.

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