NewsSouthern AfricaJapan and China to compete for Zimbabwean coal

Fri,19Sep2014

Posted on Thursday, 03 January 2013 12:33

Japan and China to compete for Zimbabwean coal

Zimbabwe hopes to ship 15 million tonnes annually to Japan/Photo©ReutersJapan and China are involved in a scramble for Zimbabwe's vast coal deposits, as the southern African country goes all out in search of investors.

 

Energy experts believe, because of its coal deposits, Zimbabwe has the capacity to become the largest independent power producing country in the region outside South Africa, but capacity constraints hamper exploration and exports.

Now with the Japanese eyeing Zimbabwe's coal deposits, the country hopes to ship 15 million tonnes annually to the Asian powerhouse.

This in comparison to last year when Zimbabwe expected only 2 million tonnes to be produced, while in 2011 2,5 million tonnes were produced.

Japan state run firm, Japan Oil Gas and Metals National Corporation (JOGMEC) has expressed keen interest in importing coal from Zimbabwe.

Deputy Minister of Mines and Mining Development Gift Chimanikire says initial contact was made with the Japanese's late last year.

"We met in December and they are looking at 15 million tonnes annually," he said.

Given that the Japan requirements are about seven times more than the country can produce per year, Chimanikire says that would be a great challenge.

"Obviously, we are going to have a big challenge but they are prepared to work with us on the production side and also enhancing the railway system to have the product move faster to the Beira port in Mozambique."

The Zimbabwe Chamber of Mines says an estimated $1 billion is required by the coal industry in form of fresh investment over a five year period.

The Japanese order book could face stiff competition from its Asian rivals - China who are establishing a foothold in the coal sector.

Coal firm - China Africa Sunlight is projecting to pump in $600 million for coal extraction and power generation projects this year.

It was granted a 100 000 hectare concession.

"We want to do coal mining, gas extraction and power generation. We are planning on contributing 600 megawatts that will be rolled out in two phases," says China Africa Sunlight general manager, Retired Colonel Charles Mugari.

The first 400 megawatts is projected to be rolled out in mid-2015 and for the thermal coal, at least 1 million metric tonnes is expected to be produced by the end of 2013 rising to 3 million metric tonnes in 2015.



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