Chemplex to set up US$20m plant
THE country’s largest chemical and fertiliser maker, Chemplex Corporation is working on injecting US$20 million towards setting-up a state-of-the-art high-grade hydrated lime plant as it moves to cut down on the importation of one of the strategic water treatment chemicals.
Chemplex Corporation chief executive officer Mr Tapuwa Mashingaidze said although the company was importing adequate lime to meet the demand by all the country’s municipalities and the Zimbabwe National Water Authority (Zinwa) for water treatment there was a need for import substitution.
Last year Government re-appointed Chemplex Corporation as the sole water chemicals’ provider for all local authorities as a measure to promote import substitution and capacitate the company.
“We have supplied lime to various municipalities needing it. Actually, Chemplex always used to supply lime even before the Government directive and municipalities buy from us primarily because of competitive pricing which we will seek to maintain. Chemplex is also working on a major project involving US$20 million investment to produce high grade hydrated lime at its G&W limestone mine at Rushinga. This will reduce the need for imports from Zambia and South Africa,” he said.
The company has over the years invested in plant upgrades for the major products such as the aluminum sulphate plant enabling it to maintain its production capacity above the growing market demand.
“ZimPhos can produce 70 000 tonnes per year of aluminum sulphate and is currently operating between 50 to 60 percent capacity utilisation in line with market demand and the available raw materials. Generally, there is enough production of aluminum sulphate for the country from ZimPhos, the manufacturing division of Chemplex. Chemplex always had capacity to supply most chemicals for decades. Since the 1970s Chemplex always supplied most of the major water treatment chemicals to all local authorities including the smaller growth points served by Zinwa,” said Mr Mashingaidze.
The company also import bauxite for aluminum manufacturing as well as sulphuric acid.
“Sulphuric acid required was historically produced locally but is currently being imported pending completion of a new sulphuric acid plant currently being constructed at ZimPhos to replace the old decommissioned plant. There is adequate funding to do this, which also depends on the rate of payment by the various municipalities for deliveries made to them by Chemplex. As long as this cashflow cycle is maintained there will be no problems,” said Mr Mashingaidze.
He said the shortages of water treatment chemicals that have haunted local authorities has more to do with their own inefficiencies.
“Problems of supplies in the past have always been linked to the financial capacity of the concerned municipalities to finance their own requirements of the chemicals and this is linked to their own efficiency of billing, rates collection and appropriate cost recovery tariffs,” said Mr Mashingaidze.
He added that there was a need for councils especially Harare and Bulawayo to be capacitated to meet the huge demand for water in their jurisdiction.
“Water chemicals supply can easily be maintained by companies like Chemplex as long as the councils generate adequate funds for their own requirements. The big infrastructure issues such as new dams and renewal of old leaking water distribution systems are the more complicated problems requiring bigger resources and more attention,” said Mr Mashingaidze.
He said although the Reserve Bank of Zimbabwe was prioritising foreign currency allocation to the company it was still being affected by the prevailing liquidity crunch in the country.
“Of course, with forex being such a scarce resource in the country at the moment, it generally is the key factor that limits the level of local production achieved and of imported chemicals procured. As more forex is secured even higher levels of production will be possible and as in the past, we could even resume exports of some of the chemicals we produce to the region,” said Mr Mashingaidze.