By Oscar Nkala.
Gold production in Zimbabwe during the first nine months of this year increased by 61% to 11 140 kg, driven largely by the firming bullion price.
In its latest report on the performance of the mining sector, the Chamber of Mines of Zimbabwe says the increased gold production means the country remains on course to achieve its production target of 15 t this year, which will enable the country to rejoin the prestigious London Bullion Market Association (LBMA).
Zimbabwe was expelled from the LBMA in 2008, when its yearly gold production tumbled to a negligible 3 t as many mines ceased production owing to the political and economic challenges facing the country at the time.
However, production has been on the rebound since the adoption of a multi- currency regime in February 2009.
Meanwhile, the chamber says Zimbabwe needs up to $7-billion to recapitalise the mining sector in the next five years. The chamber believes that, if it receives the necessary capital injection, the country can increase yearly gold production to 50 t, platinum production to 21 t and coal production to seven-million t from the two-million forecast for this year.
The industry currently faces many problems, including high operating costs, exorbitant mining fees and taxes, political uncertainty, contentious mining regulations and a liquidity crisis which has dried up sources of long-term loans. The gold sector is currently operating at nearly 50% capacity, while chrome mining has been affected by low prices. Sectors like nickel, copper and tin have not been reactivated since going on care and main- tenance in the last decade.
The positive news of an increase in gold production came as Rio Tinto-owned Murowa Diamonds announced a significant increase in diamond production to 92 000 ct between July and September.
