Published: 03 September 2017

THE country's biggest fertiliser and chemical manufacturer, Chemplex Corporation Limited requires more than $40 million to fully recapitalise its operations.

Chemplex Corporation chief executive officer Mr Tapuwa Alvin Mashingaidze said additional funding for the company to fully recapitalise one of its subsidiaries, Zimbabwe Phosphate Industries (ZimPhos) was being provided by its major shareholder, Industrial Development Corporation (IDC), which was recently funded to the tune of $83 million by the Government while efforts to seek an equity and technical partner and investor are also in progress.

"The complete scope of work on the various projects at ZimPhos including infrastructure refurbishments (covering factory structural and civil works, roads and rail siding repairs, materials handling and storage facilities as well as solid waste and effluent treatment systems) requires well over $40 million which will be done in phases and funded initially from the Reserve Bank of Zimbabwe facility and then from recapitalisation funds being mobilised as new equity by the shareholder (IDC)," said Mr Mashingaidze.

He said its other subsidiary, Dorowa Minerals Limited's mine was now fully operational after it was rehabilitated at a cost of $5 million. Work on the rehabilitation ZimPhos' sulphuric acid plant, which requires $7,5 million has started. The company received a loan facility of $10 million from RBZ of which $5 million went towards resuscitation of Dorowa with the other $5 million being channelled towards ZimPhos where an additional $2,5 million was expected to be injected soon for the completion of the project.

"At Dorowa Mine brand new mining equipment was purchased to replace old units including an excavator, three caterpillar dump trucks and two front end loaders. The phosphate concentration plant was refurbished through replacement of the major pumps and overhaul of the mill and refurbishment of other major process equipment.

"Dorowa Mine is now able to operate at full capacity thanks to this refurbishment. In fact the mine can produce more phosphate concentrate than required for local super phosphates manufacture at ZimPhos and to take advantage of the excess output, some of the beneficiated phosphate rock concentrate is being exported to earn some badly needed nostro dollars or forex," said.

He said the mine requires an ongoing replenishment of working capital to cover its operating costs and to keep it operating at capacity.

"This working capital has to come mainly from ongoing sales. The more local fertilisers are used by the local farmers, the more phosphate rock from Dorowa will be used thus making the mine's operations more sustainable and improving capacity utilisation," said Mr Mashingaidze.

The phosphate rock concentrate from Dorowa is converted into super phosphates (mainly SSP —single superphosphate) at ZimPhos by digesting the rock concentrate with sulphuric acid. The SSP is then used to produce NPK compound fertilisers such as compound "D" at ZFC, FSG and Windmill where the phosphates are mixed with AN and Potash and granulated.

ZimPhos traditionally manufactures sulphuric acid but imports it pending the refurbishment of its plant.

"Production of the phosphates will be greatly increased once the refurbishment of the sulphuric acid plant which is in progress is complete. This refurbishment is also being funded from the loan provided by RBZ and should be completed during the course of 2018.

"Sulphuric acid is also used at ZimPhos for the manufacture of Aluminum Sulphate for municipal water treatment as well as for sale to other industries such as the battery manufacturing and mining industries. Completion of the sulphuric acid plant rebuild at ZimPhos will thus have a major positive impact to the local economy," said Mr Mashingaidze.

He said other plants at ZimPhos including the Aluminum Sulphate and Phosphoric acid plants would also be refurbished in due course.

"The Alum Sulphate plant requires $1 million but about 30 percent of this has already been secured and part of the refurbishment done. The phosphoric acid plant is a more complicated project and will require around $15 million dollars. A feasibility study is being done in collaboration with a Belgian expert company to establish the viability and competitiveness of this project," Mr Mashingaidze said.
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