South African mining magnate and Metallon Gold Corporation owner, Mzi Khumalo has flown in to the country to douse flames that have engulfed the country’s largest gold producer over the last couple of months.
Metallon Gold recently hit a new low amid revelations the gold mining group has been suffering neglect from its major shareholder – Khumalo – a situation that has gravely affected productivity at the group’s two Mashonaland Central-based units (Mazowe and Shamva Gold Fields).
Mines and Mining Development Minister Winston Chitando, after meeting Mzi Khumalo yesterday in Harare, said dialogue with Khumalo around issues at the country’s largest gold producer started a while back.
“We started the dialogue with Mzi a couple of months back and also members of management from Metallon. Over the last few weeks there have been some reports in the press pertaining to Metallon operations and after the meeting, we felt it necessary to clarify and give an insight into what is happening.
“Firstly I would like to point out that over the last couple of months there have been discussions with Metallon of their plans to operate at installed capacity and secondly to operate to the full potential within their large asset base. These discussions have been ongoing and have progressively gained momentum though nothing final has come out of them as yet. The whole idea is for Metallon to operate at its full potential for the benefit of all stakeholders,” said Chitando
“I stressed to Metallon that there were concerns from stakeholders and I said that at the end of the day the objective we have is to have Metallon producing to its full capacity for the benefit of all stakeholders, the communities, the employees, Government and shareholders.”
Metallon – as a company – holds the largest gold reserves in the country of about eight million ounces which potentially could also increase and Chitando noted that the whole idea of engaging Metallon was around the vision of President Emmerson Mnangagwa for Zimbabwe to achieve middle income status by 2030.
“We will have another meeting before the end of the week and another in October. The whole idea is to walk together to ensure that the Metallon produces to its full capacity and produce about 17 tonnes of gold per annum by the year 2023.
“The up scaling of production being planned at Metallon would require the support of all stakeholders across the board and with that in mind we then agreed with Metallon that there will be a regular interface with Government so that we work together going forward,” said Chitando.
Khumalo said that the London headquartered gold producer was in Zimbabwe to stay and had several initiatives lined up to boost production. The mining mogul noted that initiatives being put in place are going to be painful.
“We started this discussion with Minister Chitando in February this year. We continued around May in London with various investors, banks and financial advisors and this arose out of the fact that President Mnangagwa supported by Minister Chitando said Zimbabwe is open for business.
“So I made an arrangement to meet with the Minister in Capetown during the mining conference where I cited that we hold eight million ounces of gold and we don’t want to keep it in the ground. We have to mine it, develop it and create even more jobs. But for that to happen there is need for re-organisation, real pain and we need the support of the Minister on foreign currency issues. We pointed out and invited the Minister to come and see what we have done at Mazowe to where we moved from a processing capacity of 11 000 tonnes per month to 70 000 tonnes per month,” said Khumalo.
Khumalo said the mining group will continue with its expansion plans across the group with a target to move from 1,8 million tonnes per annum to nine million tonnes of ore per annum. That will take the group from the current 120 000 ounces that is supposed to be produced next year to 550 000 ounces per annum by 2023.