Zimbabwe has signed a US $1bn deal with Sinosteel Corp in a development that will see the Chinese firm building a 400MW coal bed methane-fired power plant in Matabeleland North Province and setting up new ferrochrome smelters at Zimasco.
During the signing ceremony, President Emmerson Mnangagwa revealed that the first phase of the implementation will involve drilling of two Coal Bed Methane (CBM) wells at the Shangani grants to fire a 12MW pilot power station, and the second phase, more productive wells will be drilled to set up a 400 MW plant.
Sinosteel, a major shareholder in Zimasco, will build two ferrochrome smelters. One in Zvishavane and another one in Kwekwe, where it already operates the country’s largest ferrochrome plant.
Winston Chitando,minister for mines and mining development, signed the deal on behalf of the Government, while the Chinese firm was represented by its president Andong Liu. The signing ceremony was also witnessed by Vice Presidents Constantino Chiwenga and Kembo Mohadi as well as other senior Government officials.
Chitando said that the project has a potential to create more than 25000 jobs and the electricity will be used by Zimasco’s chrome smelting operations with excess supplied to the national grid.
According to Andong, the Chinese firm considers setting up three more furnaces to increase annual ferrochrome production.
President Mnangagwa added that the signing of the agreement with Sinosteel was testimony of his administration’s willingness to open up the economy to investment as well as engage the global community to do business with Zimbabwe.
“Zimbabwe is rich in minerals, most of which are still to be exploited including coal bed methane. The untapped sector presents unique and competitive investment opportunities,” said the President.
Over the past six months, President Mnangagwa’s administration attracted foreign direct investment commitments worth US $11bn in various economic sectors.
He said his Government would continue putting in place measures to facilitate the ease and cost of doing business. The power plant is expected to commence operation in 2025.