Gold production on track despite explosives shortage

ZIMBABWE is on track to achieve this year’s gold production target of 35 tonnes although the market was hampered last month by the shortage of explosives, one of the critical consumables required in mining.

Representatives of the small-scale mining industry, which contributes at least two thirds of the gold produced in the country, said this in separate interviews with this publication this week.

Last year, the country produced 30,1 tonnes of the yellow metal, down from a record high of 35,3 tonnes in 2022.

Official data from Fidelity Gold Refinery (FGR), Zimbabwe’s exclusive buyer of the yellow metal indicates that in the first 11 months of the year, the country has produced 32 tonnes with the small-scale miners accounting for 20,3 tonnes.

During the period under review, the month of October had the highest output at 4,2 tonnes from which the small-scale miners contributed 3,1 tonnes while the balance was from primary producers.

However, in November, production by both primary producers and small-scale miners declined by 11,9 percent to 3,7 tonnes with the small-scale mining industry contributing 2,6 tonnes while large-scale mining houses delivered 1,1 tonnes.

Gold Producers Association of Zimbabwe chief executive officer Irvine Chinyenze said explosives are a critical component in the mining value chain and their scarcity in the market has a direct impact on output.

“We are not looking at a situation that will drastically reduce production given that quite a number of miners had mitigatory plans and some had stocks. In the short-term we may not experience a direct knock on production but if it persists, then obviously we may have a challenge in meeting the 35 tonnes gold target.

“One hopes that it’s not going to persist and thus we are on track to meet the production target,” he said.

Chinyenze would not be drawn into ascertaining the quantity of explosives required by the small-scale mining industry over a given period of time.

“I can’t quantify how much explosive the sector requires because it’s on a mine or case by case basis, depending on the size of the project — that detects the amount of explosives that may be required and also even the rock formation because it’s not every mine that requires explosives.

“Some miners don’t do blasting; they just use their compressors and so on, but where you encounter hard rocks and other geo-formations that are difficult, that’s when you require the explosives,” he said.

Among other traditional challenges facing the mining industry, Chinyenze said, the existing power cuts have had an adversarial impact on output in the local mining sector.

Presently, Zimbabwe is experiencing critical power generation constraints, largely attributed to the El Nino-induced drought in the 2023/24 rainy season with water levels becoming extremely low and thus negatively impacting output at Kariba which has an installed capacity of 1 050MW.

Zimbabwe and Zambia receive an equal amount of water from Kariba Dam for electricity generation allocated by the Zambezi River Authority (ZRA), which is responsible for water management in the dam.

The dam was designed to operate at between levels of 475,50 metres and 488,50m for hydropower generation for the two neighbouring countries.

ZRA has indicated that usable water needed for electricity generation, as of November 11, 2024 was at 476,03m compared to 477,88m in the corresponding period in 2023.

Resultantly, this has forced Zimbabwe to rely mainly on Hwange Thermal Power Station whose installed capacity was raised to 1 520MW following the addition of Units 7 and 8 with the two units adding a combined 600MW.

However, Hwange has been experiencing technical faults worsening the power supply situation.

“The power cuts have always been a nemesis and we have pointed that out time and time again. Power challenges directly impact production — with no power there is basically very minimal production.

“In fact, where production is taking place the overheads are quite significant because alternative sources (diesel and petrol) are on the high side and it then becomes expensive to produce.

“This is also another cause for side-marketing in the gold sector because producers will be seeking alternatives to cover the gap as price variables on the official market will not be measuring up to the cost of production,” said Chinyenze.

Over the years, Zimbabwe and the southern African region have experienced power deficits largely due to lack of investments in power generation projects, climate change — rising temperatures and changing weather patterns have adversely affected hydroelectric power generation and thus worsening the supply shortage.

Moreso, regional demand growth due to the expansion of economies in SADC, has led to rising electricity demand, further straining the existing power infrastructure.

Initiatives to improve electricity supply constraints in the region include the initiative by the Southern African Power Pool to foster electricity trade, enabling member countries to share excess energy while reducing dependence on costly imports.

Countries in the region are also investing in renewable energy sources like wind and solar to diversify their energy mix and reduce dependence on fossil fuels.

In an interview, the Zimbabwe Miners Federation (ZMF) chief executive officer Wellington Takavarasha whose organisation is the mother body of small-scale mining operations in the country said: “There are a number of challenges facing small-scale miners. One of the major challenges relates to the acute shortage of explosives in the country last month.

“And we don’t know why, but the local suppliers don’t have this critical mining consumable which is imported into Zimbabwe.

“Right now as I speak there are no explosives and it’s a very big concern and we highlighted it at the gold mobilisation workshop this week. We are optimistic that if the explosive shortage is urgently attended to, the 35 tonnes gold target is achievable despite all other challenges the miners face.”

Contacted for comment, Darryn Brider, a director with Intrachem — one of the leading suppliers of the explosives in Zimbabwe attributed the explosive shortage, which he said the situation had been addressed to shipping delays.

“It was just a two-week hold up, we had a delay in shipment so it was just two weeks that was an issue. So, we’re back up and running fully, the stock is back in the market there is no shortage in the market,” he said, adding that the explosives are imported from different countries around the world.

The mining industry is one of Zimbabwe’s major cornerstones with gold being the country’s largest single export earner, generating about US$3 billion annually at present.

Official data from the Zimbabwe Investment and Development Agency, the mining industry is currently contributing 70 percent to Foreign Direct Investment, 80 percent to exports — 19 percent to Government revenues, 3 percent to direct formal employment and 13,5 percent to national income.

The sector is endowed with vast mineral deposits that include gold; platinum; diamond; lithium; chrome; coal and semi-precious stones such as amethyst, agate, antimony, and amazonite.

Players in the small-scale mining industry are predominantly found in gold, chrome and semi-precious stones along the Great Dyke belt and elsewhere in the country.ebisnessweekl