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Forex shortages derail SMM turnaround plan

by Staff reorter
11 May 2018 at 07:24hrs | Views
SHABANIE Mashava Mines' (SMM) turnaround efforts have been hampered by foreign currency shortages as the company seeks to acquire de-watering equipment at its mines in Mashava and Zvishavane.

The asbestos miner needs $900 000 to have its pumps repaired to improve its water pumping capacity during the de-watering process. As a result, SMM is four months behind schedule in de-watering its mine shaft at King Mine where it intends to kick-start underground operations by the end of the year.
SMM Holdings' chief executive officer, Mr Chirandu Dhlembeu, said they are faced with financial challenges in improving water pumping capacity and having the shaft repaired.

"The focus is now to do underground mining by the end of the year and the first is to remove water from the shafts so that repairs and maintenance can be done underground. The ore body at King Mine in Mashava is ready to mine," said Mr Dhlembeu.

"However, the pumping capacity we have at the moment is low and we are about four months behind. The major challenge is lack of foreign currency. We made applications to the Reserve Bank of Zimbabwe to acquire equipment to improve our capacity for pumping in December and we are still to access the funds."

As part of its turnaround strategy the mine is disposing its assets to raise $196 million for recapitalisation to pave way for resumption of full throttle operations. SMM ceased operations in 2005 following a fallout between businessman, Mr Mutumwa Mawere, who was the majority shareholder and Government. The development left about 5 000 workers jobless. The asbestos miner, which is the sixth largest in the world has a lifespan of 17 years and is sitting on one billion tonnes of asbestos fibre worth over $9 billion according to the current world prices of the commodity.

Source - chronicle