Chinese firm bails out Zesa
CHINESE steel giant, Tsingshan Limited will soon release US$60 million to Zesa Holdings for the construction of a power transmission line from Kwekwe to Mvuma.
This comes after the Chinese company had made a request to Zesa to improve some of its infrastructure but the power utility dithered.
The steel manufacturing giant which has operations in Zimbabwe through its Selous-based ferrochrome smelting firm Afrochine is in the process of setting up a US$3 billion stainless steel manufacturing plant in the Midlands province.
As part of the preliminary stages, Tsingshan has been looking at coming up with a sustainable power infrastructure with this power transmission line from Sherwood in Kwekwe to Mvuma being a priority.
Tsingshan Limited representative Zimbabwe Benson Xu confirmed development.
“This is still under discussion and the transmission line is the most critical part for the success of the steel project,” Xu said.
According to information available to the Zimbabwe Independent, the Chinese company would require about 1 000 megawatts (MW) out of an application of 2 300MW made to the Treasury.
This will then require the construction of a powerline to transmit the high voltage power from Sherwood in Kwekwe to Mvuma.
“There is a huge demand for electricity and an application for 2 300 MW has since been made with the Chinese company expected to utilise 1 000 MW on its own. The company will have to invest US$60 million and Zesa has since expressed its lack of capacity to execute the project due to funding constraints. in the
“Tsingshan will therefore carry out the powerline project on its own due to the electricity demands of the steel plant,” a source close to the development said.
The Independent understands that there are various meetings going on with the Chinese company proposing a tariff relief once the steel plant starts operations.
Tsingshan Limited is one of the largest stainless steel manufacturers in the world with an annual turnover of about US$10 billion.
An inter-ministerial committee was set up by the government in 2021 to expedite the construction of the multi-million dollar carbon steel plant in Mvuma.
A fluorite and limestone production plant will be set up while the National Railways of Zimbabwe (NRZ) has been tasked with coming up with a design for a railway line to connect Mvuma and Manize where the plant will be constructed on a 1,5 sq.km space.
Afrochine initially signed a US$1 billion agreement in June 2018 to build the plant with capacity for two million tonnes of steel annually.
Tsingshan through Afrochine currently produces ferrochrome at the Selous smelter facility.
China-Zimbabwe relations have grown to a comprehensive strategic and long-term partnership of cooperation since 2018.
Over the years, China has implemented various projects in Zimbabwe and these include the modernisation of the Robert Mugabe International Airport and the construction of the new parliament building, among other capital projects.