GOVERNMENT has granted Sakunda Holdings, a company with
diverse interests in energy and minerals, a coalbed methane (CBM) concession in
Mbungu, Matabeleland North province, where the firm intends to set up a power
plant.
The special grant (5 755) — measuring about 333 000
hectares — was previously owned by State-owned Zimbabwe Mining Development
Corporation (ZMDC), which now becomes a minority partner in the new venture.
While providing an update on the partial restructuring of
State-owned entities on Thursday, Finance and Economic Development Minister
Professor Mthuli Ncube indicated that Sakunda had been granted a special grant
for coalbed methane.
Sakunda chief operating officer Mr Charles Chitambo
confirmed to The Sunday Mail Business that the company was now working with
ZMDC on a special grant for coalbed methane in Matabeleland North.
“I can confirm that we are indeed working with ZMDC on a
coalbed methane special grant in Lupane area,” he said.
“We are assembling technical teams so that we can feed
necessary expertise in the boxes. As what we intend to do, it all depends on
the amount of the resources. At that stage we will be clear on what to do.”
Zimbabwe has huge deposits of untapped CBM gas in the
Hwange, Lupane and Gwayi areas.
Over the years, drilling and desorption tests have been
conducted and resources that run into trillions of cubic feet have been
discovered, according to Government’s geological department.
Chinese firm Sinosteel has already completed preliminary
exploration works on some of its CBM claims in Lupane.
Sinosteel is the majority shareholder in Zimasco —
Zimbabwe’s largest ferrochrome producer, which, in turn, owns 90 percent of
Shangani Energy Exploration (SEE).
SEE plans to exploit methane gas and build a power plant.
According to Sinosteel, an investment of about US$780
million is needed for the project to be implemented in three phases, from
exploration to full-scale power generation of 400 megawatts over a 10-year
period.
The investment is part of the US$1 billion deal signed by
President’s Mnangagwa’s administration and Sinosteel in May 2018, which will
also see the building of additional chrome smelters at Zimasco’s Kwekwe
smelting complex and in Mberengwa.
The project is among those expected to make the country
energy self-sufficient.
SEE has carried out preliminary exploration work on two of
its three special grants, where six core holes were drilled and three
production wells sunk.
Overally, the assessment demonstrated that gas and water
could be produced.
Although there is evidence proving the existence of a
considerable methane gas resource, investors are in the process of establishing
whether it can be exploited commercially.
The Chinese company completed a consulting contract with a
petroleum geologist with extensive experience to produce a work programme with
accompanying expenditures.
The programme will build on the preliminary works already
done and will include more in-depth exploration work to confirm the commercial
quantities of methane gas hosted by the three special grants.
The next phase of work would be the intense exploration
work, which will start with the installation of bigger pumps on the three wells
to drain water so that the gas can be released as part of work to establish
commercial viability.
In addition to power generation, an integrated
petrochemical industry, which has the potential to create new jobs and new
revenue streams for the nation, will be established.
The whole CBM industry has the potential to spur local
economic growth.
Matabeleland North is endowed with natural resources that
can change the economic complexion of the province if exploited under a win-win
arrangement.
President Mnangagwa, who was on a tour of coal mining
companies in Hwange last week, called on mining companies operating in the
country to partake in infrastructure development for the benefit of communities
they operate in.
He made the call while officially opening South Mining
(Pvt) Limited’s coking coal plant in Hwange.
He visited Western Coal and Energy Company’s Western Areas
coal project, South Mining’s coking plant, Jin An’s Tutu coking plant, as well
as Hwange Colliery Company’s Chaba Mine.
Local communities expect to benefit from infrastructure and
employment created by firms exploiting natural resources in their areas. Sunday
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