8 February 2013

Zimbabwe: Renco Stops Mining

Photo: Rio Zim
Renco mine in Zimbabwe

Masvingo — Masvingo's biggest gold producer, Renco Mine, stopped gold production yesterday owing to a plethora of operational challenges, amid increasing calls by the local community for Government to intervene and save the mine from collapse. The future of 1 500 workers employed at the RioZim owned mine and their families is now hanging in the balance after management shut down the gold milling plant citing lack of funds to procure key consumables. RioZim's share price has been subdued, dropping from US60c when the crisis started about three weeks ago to US50c as of yesterday. Management at the company has already closed the milling plant where the gold ore is processed and said all mining operations would stop today. The company has not been able to sell gold produced at the mine to finance its operations as villagers and workers' wives have been blocking all attempts to collect the yellow metal produced at the mine over the past three weeks.

The villagers are blocking any vehicles intenting to come out of the mine premises and also block the mine's aerodrome to prevent plans intenting to carry the gold from landing.

Rinco Mine has some of the lowest paid miners who are reportedly earning US$180 per month.

The workers and villagers are also bitter that the company did not pay out bonuses last year, while at the same time scores of pensioners are reportedly being given paltry exit packages as little as US$700 for working for more than 30 years.

Managers at the mine said the mine was going to be put under care and maintenance.

But the workers and the Nyajena community vowed to block any attempts by RioZim to collect nearly 30kgs of purified gold stocked at the mine until Government takes over the mine.

When The Herald visited the mine yesterday, the workers' wives were singing and blowing whistles at the mine entrance.

Renco Mine manager Mr Cyprian Kachisa said conditions were no longer conducive to continue operations.

"We have shut down the gold milling plant because of lack of consumables like chemicals that are used in gold milling," said Mr Kachisa.

"Even chemicals that are used to treat water from the mine such as ferrous sulphate have run out, so we cannot continue operations, otherwise we will endanger the lives of the surrounding communities since we produce some dangerous chemicals that need to be treated."

Mr Kachisa said the blockade by the workers' wives had prevented them from taking out gold for sell, resulting in lack of funds for operations.

"We cannot even buy spare parts for the mill and stocks of critical consumables such as oxygen and coal that are used in the furnace have also run out," he said.

"We cannot continue with mining operations when we do not have the mill to process the ore, even the front-end loader that we use for our operations has since broken down.

"We have a real crisis, so as the mine manager I cannot continue operations. We are stopping all mining operations tomorrow (today) and we are putting the mine under care andmaintenance

Mr Kachisa said salaries for senior staff had not been paid since the beginning of the year.

"The major problem is that we have not been able to sell the gold," he said. "There are villagers and some powerful people who are blocking the gold from being collected for sale and only recently the villagers and a group of women blocked the airstrip where the plane that had come to collect the gold intended to land."

Villagers and workers' wives said they wanted Government to take over the mine.

"We no longer want RioZim to continue operating here and they will never collect the gold which was produced for the past three weeks," spokesperson for the community and Renco Mine workers Mr Vincent Matiza said.

Mines and Mining Development Minister Obert Mpofu said in an interview yesterday that Government had no intention of taking over Renco Mine.

He said no official communication had been made to his office by either the mine owners or the community over the gold producer's crisis.

"I am just reading about the mine in the press, but there has never been any official communication to my office regarding the problems," he said.

"The mine owners know the channels to communicate their problems. After all, Renco Mine is a private company and we do not interfere with their operations. Even the community has not officially communicated anything to us with regards to what they want.

"We cannot rely on unofficial information."

Chivi South legislator Cde Ivene Dzingirai, who claims to be the representative of the Renco Mine community, said they wanted RioZim to sell the gold produced over the past three weeks and deposit the money into an account controlled by Renco Mine management.

"The Nyajena community is blocking the sale of gold by RioZim because they want guarantees that the money will be deposited into an account that is controlled by the local mine management so that they can be paid their bonuses and salaries on time," he said.

"As long as there are no such guarantees, then problems will continue at the mine."

RioZim officials accuse Masvingo South legislator Cde Walter Mzembi and Cde Dzingirai of inciting the workers and the community.

The situation at the mine is so bad that workers are walking to work for up to seven kilometresbecause there is no fuel for the company bus.

Besides an array of operational challenges, the mine owes power utility Zesa nearly US$1,4 million and may be switched off any time.

The dispute at Renco has since spilled into the courts, with RioZim seeking to bar Cdes Mzembi and Dzingirai from interfering with the mine operations.

The High Court reserved judgement in the case on Wednesday.

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