6 December 2012

Zimbabwe: ZESA Reconnects Sable

POWER utility Zesa Holdings has restored power supply to Sable Chemicals although it might take two weeks to restore normal operations at the Kwekwe-based firm. Zesa cut off power supply to the country's sole manufacturer of ammonium nitrate fertiliser a week ago over a ballooning power bill believed to be in excess of US$30 million.

Fears now abound that the brief stoppage in production might worsen the projected shortage of fertiliser this season, estimated at 20 000 tonnes.

Ammonia is a critical component in the manufacture of ammonium nitrate fertiliser because it is good for the growth of plants.

Sable Chemicals chairman Mr Misheck Kachere said in an interview yesterday that Zesa had reconnected the firm, but pointed out that the disruption needs two weeks to fix.

"The situation is that we have been switched on and we are now running around organising the start-up, but after closing down briefly it will take bit of time to resume production.

"This was not limited to the electrolysis plant alone, but we are making everything ready (to restart) in the next two weeks," he said.

Mr Kachere could not be drawn into discussing what they had agreed with Zesa on the power bill.

Efforts to get a comment from Zesa public relations manager Mr Fullard Gwasira were futile as his mobile phone went unanswered.

The development comes as Sable Chemicals is planning to decommission its electrolysis plant - used to separate water oxygen for the hydrogen it requires in the production of ammonia - in January.

The electrolysis plant is the major factor behind Sable Chemicals' accumulation of the unsustainable electricity bill. The plant consumes up to 70 megawatts every month.

This results in a US$2 million power bill a month, which eats into the firms profitability, driving it into losses.

This is despite the fact that Sable, due to its strategic importance, gets power at a Government subsidised rate of US3 cents per kilowatt instead of US7,53 for other consumers.

The plant, which started operating in 1972, is now old and expensive to run, apart from its high consumption of power.

It is against this background that Sable would want to shut down the electrolysis plant and rely on imported ammonia for the production of ammonium nitrate fertiliser.

But there has been concern that any glitches in the importation of ammonia would leave the country vulnerable. The country would have to contend with that situation for a long time considering the planned alternative of coal gasification requires a whopping US$660 million to set up.

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