Chamber of Mines - Zimbabwe Mining Indaba

Report
THE CHAMBER OF MINES
OF ZIMBABWE
ALEX MHEMBERE
PRESIDENT
CHAMBER OF MINES OF ZIMBABWE
•
•
Zimbabwe’s mineral resources
Contribution of the mining sector to Zimbabwe’s
economy:
Where have we come from?
Where are we now?
•
•
Where to for Zimbabwe? Mining as the cornerstone
for economic growth
Conclusion
THE CHAMBER OF MINES
OF ZIMBABWE
“The mining sector will be the centrepiece of our
economic recovery and growth. It should generate
growth spurts across sectors, reignite that economic
miracle which must now happen…we need to explore
new deposits, developing new greenfield projects in
the mining sector. Above all, we need to move
purposefully towards beneficiation of our raw
minerals.”
President R.G. Mugabe inauguration speech
4
•
More than 40 different minerals
•
Diverse mining sector
•
+800 operating mines
•
Ranging from artisanal and small
scale mines to world class mines
5
THE CHAMBER OF MINES
OF ZIMBABWE
•
The mining sector has to date been the most dynamic sector of
the Zimbabwean economy, leading the 2009-2011 rebound with
average annualised growth of 35%.
Aug 2013
7
Positive correlation between export growth and mineral export
growth
5000
4500
Value of mineral exports (1980- 2012)
4000
3500
3000
2500
2000
1500
1000
500
0
1980
1990
1996
2000
2005
2006
mining exports (USD million)
2007
2008
2009
national exports (USD million)
2010
2011
2012
Contribution to Total Mineral
Exports
1993-2003 (%)
2004-2011 (%)
2012 (%)
Gold
57.3
24.2
26.9%
HCF
20
10.7
8.6%
Nickel
15.1
11.0
0.7
PGMS*
2.3
46.1
27.2%
Diamonds
0.8
6.7
26.1%
Others
6.8%
1.3%
10.5%
RBZ, MOF, Zimstats
9
Gold Price (USD/oz)
USD
2000
1000
Avge Global
Price (USD/oz)
0
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Zimbabwe Gold Output (kg)
25000.0
20000.0
15000.0
Output (kg)
10000.0
5000.0
0.0
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
10
Nickel Price (USD/t)
40000
USD
30000
20000
Average
10000
(USD/t)
Global Price
0
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Zimbabwe Nickel Output (t)
12,000.0
10,000.0
8,000.0
6,000.0
Zimbabwe Output (t)
4,000.0
2,000.0
0.0
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
11
Coal Price (USD/t)
80
Average Global
USD
60
Price (USD/t)
40
20
0
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Zimbabwe Coal Output (t)
4,000,000
3,500,000
3,000,000
2,500,000
2,000,000
Zimbabwe Output (t)
1,500,000
1,000,000
500,000
0
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
12
THE CHAMBER OF MINES
OF ZIMBABWE
•
Mineral output for 2013 expected to surpass 2012 production
Mineral
Gold (kgs)
Coal (tons)
Nickel (metric tons)
Platinum (kgs)
Chrome Ore (tons)
Palladium (kgs)
Diamonds (tons)
2012
Actual
14,742
2013
Jan-June
Actual
6,727.36
1,784,763
955,086.00
2,000,000
7,899
4,887.33
10,000
10,524
6,599.49
12,500
408,475
92,073
282,000
8,136
5,068.54
10,000
12,014,802
2013
Projection
-
Source: Ministry of Mines, Chamber of Mines
17,000
16,900,000
14
Mining Contribution to GDP (1995-2015)
17.80%
16.90%
15.00%
15.70%
13.00%
12.00%
8.00%
4.30%
1995
3.80%
3.70%
1996
1997
4.00%
3.90%
1998
1999
2009
2010
2011
2012
2013f
Aug 2013
2014f
2015f
15
Total Tax Paid Directly by Mining sector to government ($)
445,000,000
387,300,000
167,523,764
57,800,000
2009
2010
2011
2012
Aug 2013
16
70000
59000
60000
51000
50000
45000
39000
40000
38,516
37,971
45,918
45,200
45,800
2010
2011
2012
38,616
33,289
30000
20000
10000
0
1990
1995
2000
2004
2006
2007
2008
2009
Aug 2013
17
•
•
•
•
•
Contribution of mining companies goes beyond paying taxes
Towns and cities have been built around mines (e.g.Bindura, Hwange,
Kwekwe and Zvishavane)
New local enterprises have been developed through linkages to mining
operations
Schools and hospitals have been established by mines
Sports teams have been established
by mining companies (e.g. Hwange
FC, FC Platinum)
July 2013
18
THE CHAMBER OF MINES
OF ZIMBABWE
With the new thrust of mining as the cornerstone of
economic growth, it’s imperative to:
1. Resuscitate existing mining operations
2. Develop new mines
3. Beneficiate mineral output
4. Establish linkages between the mining sector
and other sectors of the economy, particularly
manufacturing
Resuscitation of Existing Mines
30000
25000
20000
15000
10000
5000
0
1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Source: COMZ 2012 and RMG 2012
Resuscitation of Existing Mines
Resuscitation of Existing Mines
Resuscitation of Existing Mines
- Capital - Knowledge
Feasibility Studies
• Exploration & evaluation
- Innovation
Required
for all
Stages
Refineries
• Design, planning & costing
Smelter
• Drying, smelting
Shaft sinking
• Converting
• Drill, blast, clean, support
• Equip
Concentrator
Development
• Mill
• Footwall off-reef and onreef
• Flotation
• Drill, blast, clean, support
Stoping
Transport
• Drill, blast, clean, support
• Shaft hoisting
• Underground rail transport
• Surface rail transport
25
The Chamber of Mines is in full support of the Government’s call for
beneficiation of mineral output
1. Down-stream beneficiation - Downstream value addition involves a range
of activities including large-scale capital-intensive activities such as
smelting and refining as well as labour-intensive activities such as craft
jewellery and metal fabrication.
• Mining beneficiation – capabilities of the mining company in the
areas of smelting or concentration
• Manufacturing beneficiation – when manufacturing companies have
capabilities to produce a final consumer product
2. Side-stream beneficiation - Refers to inputs, namely capital goods,
consumable and services, into the value chain
Supported by mining companies in Zimbabwe as well as policy makers
To a large extent, mineral beneficiation is already taking place in the
country
Manufacturing beneficiation took
place with the manufacture of
asbestos cement products
There will be a picture of the mine
here
Between 1965 and 1978 asbestos was
the country's principal mineral in
terms of the value of output
Production peaked in 1974 at
281kt. 2012 production was
29.5tonnes.
Shabanie and Mashaba Mines have
been operating below capacity
Beneficiation in chromite mining has
been taking place through the
production of ferrochrome
Production: 2012 production was
31.82% down on the previous year at
408,475.81 tons.
Most of the smaller smelters
remained under care and
maintenance during 2012, with
ZIMASCO being the only smelting
facility operating
Mining beneficiation is taking place
with the use of coal in power stations
There will be a picture of the mine
here
Most potential in the sector has
remained under-utilised
Production averaged over 5mt/yr in
the 1990s but fell to 1.9mt in 2009
before recovering to 2.8mt in 2010
and 4.6mt in 2011
Hwange Colliery Company continues
to be the largest coal producer with
additional production coming from
Makomo Resources and Galpex.
Mining beneficiation for gold mining
has been taking place through Fidelity
Refiniries
Production has rapidly recovered to
14.7tons in 2012 compared to 3.6
tons in 2008 since adoption of the
multi-currency system in 2009,
production
Artisanal and small scale miners play
a large role contributing to gold
output
There will be a picture of the mine
here
Mining and manufacturing
beneficiation used to take place for
iron ore mined at Ripple Creek and
Steel produced in Redcliff
Production peaked in 1992 at 1.46
Mt, and then fell to zero in 2008
Mining beneficiation took place at the
Bindura Smelter and Refinery complex
There will be a picture of the mine
here
Bindura Nickel Corporation, the
primary producer for nickel placed its
smelter and refineries on care and
maintanence in 2008
For the past 4 years, most nickel
production has been from platinum
mining operations as a byproduct.
Production: Peaked in 1994 at just
over 13,000 tonnes
Three operating mines in Zimbabwe;
- 2 producing concentrate
- 1 producing matte after smelting
Potential exists for further
beneficiation and work is already in
progress in this regard
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•
It’s critical that linkages with other sectors are created, especially
manufacturing
Zimbabwe’s manufacturing sector has been hamstrung over the past
15 years, therefore capacity for manufacturing beneficiation is
limited
2012 Capacity Utilisation in Zimbabwe Manufacturing
90.0%
80.0%
70.0%
60.0%
50.0%
40.0%
30.0%
Level of utlisation
20.0%
10.0%
0.0%
Source: CZI State of
Manufacturing Survey,
July 2013
36
THE CHAMBER OF MINES
OF ZIMBABWE
Despite constraints, the sector is poised for marked growth in the next 5
years with World Bank (2012) forecasting positive outlook under two
scenarios:
1. Base Case ( current policies and costs)
• Gross revenues and fiscal revenues of the mining sector to increase by 63
and 87 percent in 2018, respectively, to $4.8 billion and $729 million.
2. Optimistic Case ( assumes investment capital of around $5 billion and
optimal policies)
• Gross revenues and fiscal revenues of the mining sector to increase by
274 percent and 307 percent in 2018, respectively, compared to 2011.
• The increase in gross revenues and fiscal revenues compared to the base
case projections for 2018 are 130 percent and 118 percent, respectively
THE CHAMBER OF MINES
OF ZIMBABWE
- Zimbabwe is endowed with abundant mineral resources
- indeed mining can become the cornerstone of an economic turnaround
- We need to resuscitate existing mines on care and maintenance to pre1998 levels
- We need to invest in exploration and new mining development
- We need to focus on value addition and beneficiation
- We need to focus on linkages
To achieve this, we need to address the following issues:
- A common national vision
- Policy consistency. Mining Policy in progress. To now focus on economic
& Industrial Policies.
- Competitive fiscal regime
- We need to attract investment to the sector
- Improve critical infrastructure, i.e. electricity, roads and water supply
THE CHAMBER OF MINES
OF ZIMBABWE

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