Zimasco’s $780mln gas project awaits govt approval, three years on

Zimasco’s $780mln gas project awaits govt approval, three years on

By Plaxedes Sibanda, HARARE, March 22 (The Source) – Shangani Energy Exploration says is in talks with government to approve the renewal of its grants worth $780 million which will enable it to source funds to start work on a gas project and a power plant.

SEE is jointly owned by ferrochrome producer Zimasco Holdings and its parent company, China’s Sinosteel Corporation with an  84,81 percent stake, while the remainder is privately held by Paul Tromp.

The company has  three production grants and three exploration grants but has been waiting for regulatory approval since 2014.

Zimasco’s judicial manager Reggie Saruchera of Grant Thornton told creditors at the High Court on Wednesday that SEE has concessions worth $700 million which awaits approval by government officials.

“The minister (of Mines, Walter Chidhakwa) said he has taken the matter to Cabinet and they have agreed. What’s left is for the authorities to sign the grant. In the next month or two we could actually have those special grants operating. That would mean attracting investors coming in for that project,” Saruchera told the creditors.

So far $1,9 million has been spent in exploration work.

Zimasco Holdings owes FBC Bank, CABS Zimasco Private Limited $3,8 million, $8,4 million and $998,000 in that order. SEE owes CABS $8,4 million.

Retrenchees were paid $2,1 million in December 2016.

SEE plans to build a 400 megawatt power station on the concession. The initial concession owned by the company held an estimated 660 billion cubic metres of gas, but government reduced the size of the land.

On March 12 2014, a company official, Roger Williams told Parliament that the project will be carried out in two phases, with the first expected to  take 18 months to complete at a cost of  $50 million.