16 November 2017

Zimbabwe: U.S.$15 Million Diamond Plant Expected to Run This Year

Ishemunyoro Chingwere Business Reporter The Zimbabwe Consolidated Diamond Company is set to miss its annual target of 2 million carats after delays to the installation of its $15 million, 450-tonnes-per-hour conglomerate processing plant. The plant, which was due to take off in August, has been deferred by delays in supply, Zimra clearances, foreign currency constraints to pay suppliers as well as the shortage of appropriate steel in the country for civil works. However, the installation is now back on the rails with work now at an advanced stage. The first phase of crushing is now expected before the end of the year. The clearing challenges, which saw shipments being delayed have since been resolved after engagements between the taxman and ZCDC. "Crushing did not take off in August as had been planned due to delays in supply, clearances at Zimra, foreign currency constraints to pay suppliers, shortage of appropriate steel in the country for civil works," ZCDC chief executive officer Dr Moris Mpofu told The Herald Business recently.

But the good news is ZCDC has managed to de-risk on these bottlenecks and the project is back on course. Installation of the plant is now at an advanced stage and the first phase of crushing will commence this quarter.

"The project will be full throttle in the first quarter of 2018, but the delays may affect our initial target of 2 million carats for 2017. Despite the delays, we still anticipate business growth going into 2018 as the Chiadzwa and Chimanimani business units will be fully capacitated to produce more than 200 000 carats per month. Plans are also underway to open two more mines with feasibility studies already in progress," said Dr Mpofu.

Dr Mpofu said the mining entity is no longer anticipating any further delays as they have since been assured by the taxman that the process will be expedited. "Given the magnitude of plant shipments which were totalling about 20 per week, ZCDC faced teething capacity challenges with Zimra at the initial stages, and lost some weeks on Plant installation. "But I want to commend Zimra management for responding positively following engagements and clearances improved significantly. We continue to be in constant touch with Zimra to ensure that the remaining shipments are not further compromised," said Dr Mpofu.

The investment into conglomerate mining was preceded by a Business Optimisation and Project Sensitivity analysis which was carried out to determine project viability. The first phase of the project will effectively mark the comprehensive transition from alluvial to conglomerate mining and processing. The miner also plans to commission a washing and recovery plant which will be equipped with latest X-ray recovery technology in the first quarter of 2018 before ushering in a "revolutionary X-Ray technology based Mega Diamond Recovery system" which is expected to recover diamonds of larger sizes and higher value. ZCDC's decision to move from alluvial to conglomerate mining was informed by the increasing unavailability and depletion of the former.

The company, which commenced operations in February 2016, began by processing alluvial deposits from various concessions and had relied on fifth generation X-ray recovery technology to recover diamonds from processed material. With the depletion of rich alluvial pickings, the company managed 965 000 carats in 2016 but they have to date managed to stockpile about 1,5 million carats some of which are expected to be auctioned this year.

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