HARARE, May 3 (The Source) – RioZim’s three gold mines are producing about 137 kilogrammes of the precious metal monthly — 59 percent of capacity — officials said on Wednesday, highlighting the urgent need for fresh investment to ramp up output.
RioZim, a Zimbabwe-listed entity spun off global giant Rio Tinto in 2004, is one of the country’s major gold producers, alongside Metallon Corporation, London-listed Asa Resources and Caledonia Mining Corporation, headquartered in Toronto, Canada. The country’s gold production has rebounded, reaching 22 tonnes in 2016, from its 2008 nadir of 3 tonnes.
RioZim executives were part of a group of mining executives summoned by the parliamentary committee on transport and infrastructure, which sought to press mines to invest more in infrastructural development around their operations.
Apart from pointing to some expenditure on infrastructure, the mine executives argued that their operations required additional investment to increase output.
RioZim chief operating officer Allan Mashingaidze told the parliamentary committee that the historic Cam and Motor mine, which reopened in 2015 having ceased operations nearly half a century earlier, was currently producing 42 kg per month, below its 100 kg capacity. The mine produced 856 kg in 2016, at an average monthly rate of 71.3 kg.
Mashingaidze said Renco mine in Masvingo, with a monthly capacity of 73 kg was currently producing 55 kg. The mine produced 712 kg in 2016, at an average monthly rate of 59.3 kg. Dalny mine, which RioZim recently acquired from Falcon Gold, currently had a monthly output of 40 kg, although it can produce up to 58 kg per month.
RioZim group acting chief executive Bhekinkosi Nkomo told the committee that the company, which registered net profit ($2.5 million) last year for the first time since dollarisation, needs to invest more in the three mines to increase production.
“Over and above production and the high cost structure in the industry, there is also need for additional investment to be done to stabilise these operations,” said Nkomo.
The company says the acquisition of Dalny Mine previously owned by Falcon will double RioZim’s Net Asset Value from $4,4 million to $9,5 million.
RioZim also owns Murowa diamond mine, which they said is operating at 68 percent production capacity, producing 40,000 carats per month.
Zimbabwe’s biggest mining company, Zimplats, had earlier told the same committee that it had invested $174 million in roads, electricity as well as social infrastructure such as health and education facilities since 2001 when it commenced operations.