Golden Sibanda in Bulawayo
Zimbabwe has opened high level discussions with a major, but unnamed South African automobile parts producing company, which is interested in setting up a catalytic converters manufacturing plant in the country, according to Mines and Mining Development Minister Winston Chitando.
This comes as the Government is also working on a grand scheme of growing the mining sector from the current $3 billion to $12 billion industry by 2023, and expand its contribution towards attaining President Mnangagwa’s Vision 2030, of transforming Zimbabwe into a middle income country with per capita income of above $3 500.
Government has designated mining, which accounts for an estimated 12-16 percent of Zimbabwe’s Gross Domestic Product (GDP), to drive short to medium growth of the domestic economy.
Zimbabwe is home to more than 40 of the world’s top minerals, including gold, platinum, chrome, diamond, nickel and coal.
As such, the SA Company, will establish operations to start limited production of catalytic converters, which are used in fuel combustion powered vehicles, in Zimbabwe once local platinum group metal (PGM) mining firms have built base metal refineries and precious metal refineries.
Three of the current actively producing platinum mines in Zimbabwe namely Australia Stock Exchange listed Zimplats, SA’s Sibanye Stillwater and Aquarius 50-50 owned Mimosa Mining Company and Anglo American owned Unki Mines, have already submitted the roadmap on firstly building a BMR and thereafter a precious metal refinery.
Negotiations with the S A automobile firm
Chitando made the revelation about the proposed investment by the South African firm while officially opening Mine Entra 2018, an annual gathering of all influential stakeholders in mining, transport and infrastructure from Zimbabwe and beyond.
“I won’t mention the player, but a significant percentage of platinum produced in South Africa is value added around East London for the production of catalytic converters.
“We have already opened discussions with this company; they are ready to come and set up shop (in Zimbabwe) and be given economic zone status in the Great Dyke to start to plan for the production of a limited quantity of catalytic converters, once these refineries are up and running; what a pleasure.
“Again, you have to work together with the platinum producers association and the entity concerned, which would like to come and pick up value addition and produce catalytic converters. So, early stages of discussions, but they say every journey begins with the first step,” the Minister said.
Catalytic converters are critical to fossil fuel vehicle combustion systems. In order to reduce air pollution, modern automobiles are equipped with a device called a catalytic converter that reduces emissions of three harmful compounds found in car exhaust fumes, are made from platinum.
Zimbabwe has the world’s second biggest known deposits of platinum group metals after South Africa and again, comes third in production only after South Africa and Russia.
Platinum is also Zimbabwe’s third biggest foreign currency after tobacco and gold.
Together with gold, PGMs contribute over 50 percent of the country’s annual export earnings. Zimbabwe currently sends most of its platinum to South Africa for processing, meaning it exports mostly lower value semi processed form. Two of currently producing mines process up to concentrate only while one, Zimplats, exports matte.
The catalytic converters industry
Aside from vehicle manufacturing, South Africa also manufactures exhaust catalytic converters for 10 percent of the global market, thanks to the country’s huge platinum reserves, platinum being a key component of catalytic converters. South Africa is the world’s largest producer of platinum group metals.
The Eastern Cape, where East London is located, is known as the “Detroit” of South Africa because of its coastal location, which allows for the easy access to global networks.
The auto industry in the Eastern Cape is of national importance. Around 40 percent of South African car sales and 60 percent of car exports by unit are produced in the Eastern Cape.
When the components industry is included, 26 percent of South African auto sector value added and 30 percent of employment is provided by the Eastern Cape Province.
Minister Chitando said as part of increasing their contribution into growth of mining in Zimbabwe, platinum mining were investing heavily into expansion of production or smelting capacity.
Significant investment is also expected from the $4,2 billion planned investment by Cypriot firm, Karo Resources, which is already mobilising.
Karo Resources is primed to become the country’s single largest platinum mining project.
Further, Russian firm Great Dyke Investments, which is in a partnership with Government, is also in the process of implementing its multi-million
dollar platinum mining project in Darwendale, which the minister said would be a massive operation once it reaches full throttle.