LISTED coal miner Hwange Colliery Company (HCC) says it is aiming to increase production in the near term through continued investment in new mining equipment.
The firm has been weighed down by obsolete machinery which has seen reduced coal production over the years.
In order to overcome its operational challenges, the company last year invested US$7.0 million in new plant equipment and has also spent a further 11 million USD this year on new machinery from China which is expected to be commissioned before the end of the month.
The new equipment includes dump trucks, excavators, bulldozers and graders.
HCC Chairman Farai Mutamangira said the company was also looking forward to a better financial performance, buoyed by the procurement of new mining equipment.
“The company has taken delivery of the mining equipment worth US$11 million from Sany Heavy Equipment Company Limited of China and the commissioning is expected to be completed by Sept 30, 2013,” he said in an update for the half-year ended June .
“The equipment will augment the mining machinery worth 7.0 million USD procured in October 2012.
“Another initiative to procure drilling equipment from South Africa is at an advanced stage and should be concluded in time for delivery of the drills in the fourth quarter of 2013.
“There is no doubt that these recapitalization initiatives currently being implemented will result in improved production performance.”
Operations at HCC are presently plagued by working capital constraints, water logging and an inadequate supply of spares. It is estimated that the coal mining concern requires more than US$100 million in fresh capital to recapitalise its operations.
Experts say the company has the capacity to produce five million tonnes of coal per year, but due to viability problems production has been low. The bulk of the coal produced at HCC is sold to Hwange Power Station, with the remainder being sold to other local businesses.
The company also exports coal to other countries, including the Democratic Republic of Congo (DRC), Botswana, Mozambique and Zambia. – New Ziana