HARARE – Dormant iron producer NewZim Steel — formerly Ziscosteel — could soon reopen as engineers from India-based major shareholder Essar Africa Holdings (Essar) came into country last week.
Mike Bimha, Industry minister, said the engineers visited the Kwekwe-based company to assess ways of refurbishing its plant — which has been out of production for nearly a decade.
This comes as Essar’s top management had also came through a week earlier to evaluate the situation on the ground.
“The revival of NewZim Steel is a top priority for my ministry and I am sure by year-end the company will be roaring,” Bimha said.
According to the company’s workers’ union chairperson, Benedict Moyo, employees have not been paid for more than 20 months.
In 2009, Essar acquired a 54 percent stake in then Ziscosteel — 100 percent government-owned — in a $750 million deal.
The State now holds 46 percent in the steel giant, which has about 3 000 employees on its payroll despite being dormant.
Operations revival stalled after government’s refused to grant iron ore concessions to Essar for the resuscitation of operations at the iron and steel manufacturing company.
Now the new government has made a commitment to resolve the issues around the iron and steel producer’s access to the iron ore claims.
“We have made a commitment that we will ensure that NewZim Steel is able to come back on stream,” Mines minister Walter Chidhakwa has said.
Chidhakwa, who visited Mimosa mine — which is jointly owned by Impala Platinum (Implats) and Aquarius Platinum recently — said NewZim Steel will now be allowed to get access to iron ore from the contested claims.
“The issue was on Bimco reserves. We have found a way of dealing with the matter to ensure that the company continues to access the mineral ore,” said Chidakwa.
Firdhose Coovadia, Essar’s resident director for Africa, Middle East and Turkey, said last year that Essar was prepared to “invest $1 billion in a steel plant (in Zimbabwe) to achieve annual production of 1,2 million tonnes.”
It would also sink $100 million on iron ore reserves that have not previously (been) explored and another $3 billion to create a world-class beneficiation plant and a separate power plant.