Tuesday, June 21, 2016

ZCDC Sells Diamonds Worth $21.5 Million
June 21, 2016
Conrad Mwanawashe
Business Reporter
Zimbabwe Herald

The Zimbabwe Consolidated Diamond Company has since March this year sold about 513 000 carats valued at about $21,5 million from two of the diamond operations it took over in March this year.

According to production statistics presented to the parliamentary portfolio committee on Mines and Energy by ZCDC acting chief executive officer Dr Ridge Nyashanu, the 513 000 carats were realised from ex-Marange Resources and ex-Diamond Mining Company operations.“Since production started in March, we produced 218 278 carats, 222 528 carats in April and 72 563 carats in May. To date, since inception in March we have produced 513 364 from the two producing portals,” said Dr Nyashanu.

ZCDC made total profits of $6,7 million from the $21 549,008. The company made $3,5 million profit in March from the sale of 218 278 carats; $2,2 million from 222 528 carats in April and $900 000 from the sale of 72 563 carats in May from the two operations. Of this, about $1 million went to Treasury with the rest being re-employed to capitalise the company.

“So far from the profit that is coming from the two operations that are in production, that is $6,7 million, we are capitalising most of the companies. We have brought in some equipment including X-ray technology that will improve our diamond recovery. Another X-ray machine is being purchased as well. It is my understanding that $1 million has been remitted to Treasury,” said Dr Nyashanu.

ZCDC has taken over diamond concessions which were previously owned by eight companies that were operating in Chiadzwa which included Marange Resources; Mbada Diamonds; Diamond Mining Corporation; Anjin Investments; Jinan Mining; Kusena Diamonds; Rera Diamonds and Gye-Nyame Resources.

The consolidation of diamond mining companies was informed by Government’s attempt ensure transparency in the mining and trade in diamonds.

In order to attain a diamond target output of 6 000 000 carats as projected in the 2016 National Budget through the consolidated company, the Reserve Bank of Zimbabwe, in close liaison with the ZCDC, the Ministry of Mines and Mining Development and MMCZ, have instituted some measures which include increased access to long term and working capital financing.

The committee was told that revenue to the fiscus could have surpassed last year’s levels had it not been for the court challenges instituted by some of the companies such as Mbada Diamonds and Jinan against consolidation.

Secretary for Mines and Mining Development Professor Gudyanga who also appeared before the same committee said the court challenges have frustrated the new operation to an extent of slowing down operations.

“Before November or February I would have said by mid this year we would be at peak. We did not anticipate this kind of frustration towards the consolidation process. I was confident because of the processes that before six months we would have exceeded the highest diamond production levels,” said Prof Gudyanga.

Production has not started at Kusena where exploration is ongoing.

“My assessment when you go to the ground is that the plant that is at Kusena is a pilot plant and we are operating that pilot plant doing further exploration of the alluvial diamond mining,” said Dr Nyashanu.

ZCDC is also conducting exploration and evaluation of the ore body on ex-Gye-Nyame Resources where it has resuscitated the plant and completed the water line from Odzi river. In his January Monetary Policy statement, RBZ governor Dr John Mangudya said Government is mobilising funding of about $30 million for the ZCDC from development financial institutions for the company to ramp up diamond production. All the diamond export sales proceeds by ZCDC would be accounted for by the RBZ in a transparent manner similar to gold under Fidelity Printers and Refiners.

Government, through the RBZ wants ZCDC to grow and become what Fidelity Printer and Refinery is to RBZ. It is also envisaged that these two, FPR and ZCDC, should become agents for economic transformation in Zimbabwe.

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