$Unique_ID{COW04231} $Pretitle{371} $Title{Zimbabwe Chapter 3C. Mining} $Subtitle{} $Author{Donald P. Whitaker} $Affiliation{HQ, Department of the Army} $Subject{tons power production percent mines mining total zimbabwe electricity million} $Date{1982} $Log{Prospecting Map*0423101.scf Kariba Dam*0423105.scf } Country: Zimbabwe Book: Zimbabwe, A Country Study Author: Donald P. Whitaker Affiliation: HQ, Department of the Army Date: 1982 Chapter 3C. Mining [See Prospecting Map: Courtesy Embassy of Zimbabwe, Washington DC.] Relative to its size and population, Zimbabwe is one of the world's richer countries in minerals. Its mining industry is diversified and generally efficient. More than forty different minerals are produced, of which the most important in the early 1980s were gold, asbestos, nickel, copper, coal, and chromite (see table 11, Appendix). These six minerals accounted for over 85 percent of the value of total mineral production. Overall, mining has regularly contributed about 6.5 percent or more of GDP, and the industry employs an average of about 60,000 persons. Almost all mineral production is exported and accounts for about 40 percent of total earnings from merchandise exports (the share varies somewhat depending on the production and world prices for minerals). Most exports have been to the Western industrialized countries, for which chromium in particular is of strategic importance. The greater part of the country's known mineral deposits, except coal, are found in the metamorphosed greenstone areas that stretch across Zimbabwe from southwest to northeast, mainly on the highveld. These areas contain large deposits of the major minerals except chromite, which is found in the Great Dyke, a highly mineralized zone of magmatic origin that extends in a line through the greenstone area for a distance of over 500 kilometers (see Geographic Regions, ch. 2). Other areas of metamorphosed rock found in the middleveld and lowveld of the north and northwest also contain a variety of minerals, but little detailed exploration had been carried out by 1982. In various parts of the country, dikes and veins of pegmatite also occur that contain other minerals, among which the most important economically is lithium. Coal is found in extensive deposits in both the northern and the southern lowvelds. There were no known resources of petroleum as of mid-1982. Gold appears to have been mined as early as the seventh century. By the first part of the second millennium, mines were worked in many places by ancestors of the Shona. Most of the numerous early workings by the indigenous populations had been exhausted (within the limits of then-existing technology) by the 1700s, and mines that continued were abandoned during the Ngoni invasions of the 1830s. In the late 1860s reports in Europe of these mines culminated eventually in the gold rush of the 1890s and the territorial takeover by the British South Africa Company (see Rhodes and the British South Africa Company, ch. 1). From the 1890s on, gold mining became the territory's most important economic activity; output increased annually until a high of over 23,500 kilograms was reached in 1940, and gold accounted for almost three-fifths of export earnings. In the 1940s, however, production declined, and in 1952 asbestos became the most valuable mineral. During the UDI period gold output again dropped significantly as many mines closed because of security problems. The increase in the price of gold in the late 1970s again stimulated output, and propelled gold to the forefront as the most valuable mineral, a position it retained at the beginning of 1982. Total gold reserves have been estimated at about 778,000 kilograms. Since the end of the fighting the government has made information available on inactive mines and claims and has provided technical assistance as a means of stimulating new development; during 1979 some 200 new claims were reported staked out. Most mines have been small-scale operations, and over time around 4,000 deposits have been worked. After World War II larger firms able to furnish the necessary capital for deep mining gradually took over many smaller operations, and by 1958 only 256 mines were reported active. At the end of the 1970s some 260 mines were in operation, of which less than 10 percent accounted for over three-quarters of output. The larger mines were mostly foreign owned, the largest holdings being those of the Lonrho Investment Group, based in Britain, and Falcon Mines of South Africa. Asbestos deposits are found in a number of places, but the main reserves are located in an area extending from Masvingo (formerly Fort Victoria) to Zvishavane (formerly Shabani). The largest asbestos mining operation (British owned) is located near Zvishavane and reportedly produces an estimated 90 percent of total Zimbabwean output. In 1965 about 160,000 tons of asbestos were produced. Sanctions had little impact on the industry, which was expanded to over 260,000 tons in the mid-1970s, reaching a peak of more than 281,000 tons in 1976. The expansion was carried out mainly with funds secured within the country. After 1976 production declined somewhat to an average of about 250,000 tons a year. The asbestos produced is of the chrysolite variety, having characteristics considered valuable for certain defence uses. Some of the output is used domestically and in adjacent countries in the fabrication of asbestos cement pipes and for construction, but most is exported, principally to the United States and Britain and other West European countries. The size of the country's reserves in 1982 had not been disclosed, but it was believed to be very large. Copper is found in several parts of the country, but the main exploited deposits are near Chinhoyi (formerly Sinoia) northwest of Harare. Copper was mined by indigenous peoples from at least the early part of the first millennium. The main present-day mines are located at the ancient workings. Modern production of copper began in 1906, but output did not exceed a few hundred tons until the 1950s when South African interests acquired major holdings in the industry. Production rose steadily thereafter and reached a high of 47,600 tons (copper-content) in 1975. Fluctuating world copper prices since 1973, declining ore grade, and increasing operating costs have been accompanied by a drop in output, which totaled only 24,600 tons in 1981. A number of the principal mines have ceased operations and in mid-1982 were only being maintained. A new copper refinery began operations in 1981, turning out high-quality cathodes that were expected to secure better export prices. In 1979 nickel production accounted for about 14 percent by value of total mineral output. Nickel had emerged as major contributor to mineral production only in 1969. Small deposits were worked from 1928, but the nickel content of the ore was never more than a few hundred tons a year. During the 1950s several major new deposits were discovered that were developed after UDI by transnational companies based in Britain; South African investment was also involved. In 1969 production was 5,747 tons (nickel content), compared with 441 tons the year before. In the late 1970s and through 1981 production averaged about 15,000 tons annually. Nickel deposits are located mainly in greenstone areas along the Great Dyke. Those being mined in the early 1980s contained about 60 million tons of ore. In addition about 2 billion tons of lower grade ore have also been found. The nickel ores usually contain varying quantities of copper, cobalt, silver, platinum, and palladium. These are produced as by-products by the country's two smelters located at Bindura (annual capacity about 16,000 tons of nickel metal) and near Kadoma (formerly Gatooma; 9,000 tons); about 3,000 tons of copper have also been recovered annually. Cobalt production was ordinarily small (under thirty tons); but a dramatic rise in world prices for the mineral in 1979 was accompanied by an increase in output to over 200 tons, and 115 tons were produced in 1980. Foreign exchange earnings were significant in both years. Of importance to Zimbabwe's future competitive position in the world nickel market, the kind of ores found in the country can be processed more cheaply than those mined elsewhere, and the nickel metal produced is of high quality. Zimbabwe's output of chrome ores ranked it fifth among the world's producers in 1980. The country's chromite deposits have been estimated variously at 3 billion to more than 10 billion tons, of which 500 to 564 million tons are exploitable reserves. The ores are found associated with and throughout the entire length of the Great Dyke. Mining began in 1906 in the area of Shurugwi (formerly Selukwe) but did not become important until after World War II; in 1982 this area remained the principal source of the ore. Transnational companies, including the Anglo-American Corporation of South Africa and Union Carbide Corporation of the United States, owned most of the mines and processing facilities. Processing of the ore into ferrochrome began in 1953 by a subsidiary of Anglo-American. This plant, located at Gweru (formerly Gwelo), had an initial capacity of 9,000 tons that had been increased to 113,000 tons by 1979. Further expansion, expected to be completed in 1982, was to raise total capacity to 163,000 tons. The country's other plant, at Kwekwe (formerly Que Que), taken over by Union Carbide in 1965 when it had a capacity of 15,000 tons, had been expanded to 90,000 tons by 1979. Additions begun in 1981 and to be completed in 1982 will increase the plant's capacity to 180,000 tons. Chrome ore production continued at a relatively steady level after UDI, averaging over 500,000 tons a year for the period 1965-70, and there was evidence that the UN sanctions were being successfully evaded. Subsequent to passage in the United States in 1971 of the Byrd Amendment (Public Law 92-156), which relaxed restrictions on chrome imports, output increased sharply, reaching well over 850,000 tons a year. After the reimposition by the United States in 1977 of an embargo on this trade, production again declined to about the pre-1971 level (see The United Nations and Sanctions, ch. 1). Chrome exports (almost entirely in the form of ferrochrome) in 1979 ranked third after gold and asbestos. Chrome is of strategic importance to the United States and the countries of the European Economic Community (EEC). Exports of Zimbabwean ferrochrome increased in 1979 as sanctions were lifted and again rose sharply in 1980. Some decline was registered in 1981, but export earnings in 1980 and 1981 exceeded those of asbestos and were second only to gold. The country has very large coal resources that have been estimated at roughly 30 billion tons. The deposits are located in both the northern and the southern lowveld areas. Those in the north are found in fields of vast overall proportions that begin in the western part of the Zambezi River valley and stretch eastward for more than 300 kilometers. In the south substantial coalfields exist in the Limpopo River basin. Minable coal employing present-day techniques amounts to about 750 million tons from fully evaluated reserves totaling some 2.2 billion tons. In addition another 5 billion tons of potential reserves have been projected. About two-thirds of the coal believed extractable is though to be coking coal. The remaining third has a high ash content but is suitable for use in producing steam for electric power generation. Commercially significant mining of coal has been centered in Hwange in western Zimbabwe since the discovery of the coalfield in that locality in 1864. The first of three underground mines of the present Wankie Colliery Company Limited (WCCL) opened in 1903. The second began operations in 1927, and in that year production exceeded 1 million tons. In 1953 management was taken over by a subsidiary of Anglo-American Corporation, which in 1980 owned a 34 percent interest in WCCL (the second largest interest was the 5 percent share owned by Union Miniere of Belgium). A third mine was opened in 1953, and production reached 4 million tons in 1957. A major underground explosion in 1972 led to the closing of this mine and the subsequent opening of a new one. Since 1970 four open-pit mines have also been developed. From 1965 to 1980 total annual production averaged about 3.3 million tons, most of which was used domestically by thermal power stations, Rhodesia Railways, various industrial operations, and tobacco curers. In 1981 WCCL facilities included coke ovens having a capacity of some 216,000 tons a year. In the early 1980s well over 100,000 tons of coke were exported annually, almost entirely to Zaire and Zambia, earning substantial foreign exchange. Another some 100,000 tons were used by domestic industries, the largest user being the ferroalloy industry. In early 1982 WCCL was negotiating a loan from the International Finance Corporation (IFC)-additional funds were also being sought through the United States Export-Import Bank-for a new open-pit mine that would eventually produce 3.9 million tons a year. This would replace production from existing open-pit mines, which were approaching depletion; about two-fifths of the total would be used by the new Wankie Power Station (see Electric Power, this ch.). Among other minerals of more than ordinary importance in Zimbabwe are iron, lithium, silver, tantalum, tin, and tungsten. Iron ore is widely distributed and had been mined in the area as early as the first millennium A.D. (see The Origins of Zimbabwe, ch. 1). Present-day production is centered mainly at Redcliff, south of Kwekwe. Ores are mainly used domestically to produce iron and steel, which have been exported in substantial quantities and have been major foreign exchange earners. The principal lithium deposit is near Bikita (east of Masvingo), where recoverable ore reserves are estimated at about 8.1 million tons. The ore produced is mostly exported. Silver is produced as a by-product in gold extraction, nickel smelting, and other refining operations. The rise in silver prices in the late 1970s led to increased output and substantial foreign exchange earnings. Tin metal also has been a major foreign exchange earner; tantalum and tungsten ores and concentrates are of lesser significance. Foreign-owned companies (mainly American, British, and South African) have long controlled mineral production. Private sector involvement in mining has been strongly encouraged since the start of settler self-government in 1923 (see The 1922 Referendum: Company to Colony, ch. 1). The Mugabe government in essence continued support for this policy in its position paper Growth with Equity of February 1981. However, it has also called for foreign investors to take on local equity partners and to increase the participation of Zimbabweans in managerial and technical activities associated with mining. New energy and strategic minerals undertakings have required government participation. The government has also reserved the right to participate in any other mining venture begun by a company that had not previously carried on mining in Zimbabwe. Of greater significance to the mining industry and potential foreign investment was passage of the Minerals Marketing Act in early 1982. The government marketing corporation authorized by the act will have wide powers, including control of sales of all mineral production except gold, which is sold directly to the Reserve Bank of Zimbabwe, and the size of stockpiles. Energy Sources At the beginning of the 1980s about three-quarters of the country's energy was provided by domestic coal, wood, and hydroelectric power. The remaining quarter was imported in the form of petroleum products and additional electricity, the latter secured almost entirely from Zambia. Coal was the largest primary energy source, accounting for roughly one-third of total consumption. But about 10 percent of the coal was transformed into electricity, and that amount would increase after new thermal generating facilities under construction went into operation at the end of 1982 and during 1983. Coal, electricity, and petroleum products were used almost entirely by the modern sector. Wood was used as a source of energy by an estimated 6 million people, and at least 5 million (including virtually the entire 3.5 million population of the communal lands) were entirely dependent on wood for cooking and heating. Commercial agriculture also consumed considerable quantities of wood for curing and, to a lesser extent, for drying tobacco. On the average about 28 percent of all energy used in the late 1970s was derived from wood. Potentially there appeared to be adequate supplies, considering existing total tree stock. But in the many areas of high rural population concentration, the demand exceeded supply because of deforestation, and cost and distance were deterrents to moving in wood for fuel from other areas. In 1981 in communal lands northeast of Masvingo the African population had reported had to use cattle dung as fuel. The overall situation was compounded by the general failure to use charcoal, a more readily and cheaply transportable fuel. The government had plans to establish renewable woodlots in communal areas, but the problem was of major dimension, and the program was only in an initial stage in 1982. Electric Power Zimbabwe's principal domestic source of electricity in mid-1982 was the Kariba I hydroelectric plant located on the Zimbabwean side of the Zambezi River at the Kariba Dam. Having an installed capacity of 705,000 kilowatts, the plant had furnished about 55 percent of the country's electric power in 1980 and 1981. Kariba I was constructed (after establishment of the Central African Federation in 1953) as the first part of a planned complex at the dam designed to furnish the power needed for the economic expansion of the two Rhodesias. On dissolution of the federation in 1963, operation of the plant-and distribution of power to the two territories-was vested in the newly formed Central African Power Corporation (CAPC), which was jointly owned by the two governments. Under this arrangement, which remained in effect in mid-1982, the plant continued to supply power to Zambia after UDI and the imposition of UN sanctions despite the fact that Zambia was one of the leading advocates of sanctions. About 70 percent of Zambian power needs were met until construction of new facilities inside that country in the early 1970s reduced its dependence. After the operational start of the new Kariba II plant on the north bank of the Zambezi River in 1976, Zambian production of electricity exceeded its own requirements, and power began to be imported by Rhodesia to meet the growing demand. Such imports have increased, and in 1980 and 1981 they accounted for about 38 to 40 percent of the power distributed in Zimbabwe. In 1982 installation of 300,000 additional kilowatts of capacity at the Kariba I plant was contemplated by Zimbabwe, but the project awaited the necessary agreement from Zambia. If carried out, completion would occur in the late 1980s. In 1982 thermal electricity accounted for only a small part of domestic power supplies. The first thermal plant began operations in Bulawayo in 1897 as a private venture. It was acquired as a municipal facility in 1899, and during the following decades municipal plants were established in many towns (Salisbury in 1913). In 1936 the government-owned Electrical Supply Corporation (ESC) was set up to construct transmission lines, build plants where needed, and develop interconnected systems. New ESC plants included thermal facilities at Zvishavane, Umniati (between Kwekwe and Kadoma), and Mutare. After completion of Kariba I, ESC also purchased power from the CAPC. In the aftermath of UDI the production of thermal power increased, and in 1973 a high of 1.4 billion kilowatt-hours (over a quarter of the domestic electricity distribution) was generated by ESC and other interconnected thermal units. Thermal power input into the system declined thereafter and in 1981 was under 219 million kilowatt-hours. The three ESC plants were old, and only the Umniati plant (installed capacity 120,000 kilowatts) was in regular operation in 1982. Bulawayo and Harare have continued to maintain their own municipal distribution systems and power plants (120,000 kilowatts and 135,000 kilowatts, respectively), and various private firms have operated their own facilities. ESC also directly purchased limited amounts of electricity from sources outside Zimbabwe to supply several remote areas. Included were the Electricity Supply Commission of South Africa, which supplied power for the Beitbridge area, and the Zambia Electricity Supply Corporation, which provided power for Victoria Falls under a mutual standby arrangement. In the early 1970s the anticipated future needs for power led the government to start work on a large thermal plant in the Hwange area that was designed to use the great quantities of low-grade coal usually discarded in open-pit mining but usable as a cheap source to produce steam. Reportedly the international contractor withdrew after a time because of external sanction-related pressures. The government continued construction to 1975; but when stopped for economic reasons, work was well along. Activity resumed in 1980, and in mid-1982 it was estimated that the first of four 120,000-kilowatt generating units being installed would be producing electricity for commercial sale by December. The three additional units were scheduled to be ready for service by about the end of 1983. The cost of this Stage I phase at completion was estimated at Z$369 million (for value of the Zimbabwe dollars-see Glossary). Financing has been covered through export credits and loans secured through European banks. Local costs were being financed by loans from a consortium of Zimbabwean banks to the ESC. In early 1982 the government announced that two additional units of 200,000 kilowatts each would be installed at the power station under Stage II of the project; this was to be completed about the middle of 1985. Design work and specifications for certain items had already been prepared. [See Kariba Dam: on Zambezi River, source of over half of Zimbabwe's electric power. The Dam large Lake Kariba are major tourist attractions. Courtesy United Nations] The consumption of electricity increased from 2 billion kilowatt-hours in 1965 to over 7.1 billion in 1981. Farming accounted for about 7 percent of the total. One of electricity's important uses in agriculture has been to power irrigation pumps. In mid-1981 the ESC reported, however, that total farm connections numbered only about 6,600, largely in the commercial farming areas. Mining used about 20 percent, and manufacturing, construction, and transport used about 50 percent of the total; domestic use amounted to about 14 percent. The electricity distribution system was confined almost entirely to interconnecting the towns and cities of the highveld and supplying the mining and industrial operations that were also largely located there. The African rural population had little access to electricity. The ESC stated that it was planning the development of distribution to the rural growth centers in the communal lands when these are established as part of the government's rural development program. These centers are to be the nuclei of future towns, which will be provided with full services. Petroleum Products At the time of UDI, Rhodesia's estimated requirement for petroleum products was roughly 450,000 tons a year. This was met almost entirely by the Feruka refinery, located near Mutare, which had started operations in 1964. The refinery was run by Central African Petroleum Refineries (CAPREF), a Rhodesian company owned by an international consortium whose major shareholders included Shell Petroleum Company, British Petroleum Company (BP), California Texas Oil Company (CALTEX), Mobil Oil Corporation, and American Independent Oil. The refinery was supplied by a 288-kilometer pipeline from the port of Beira in Mozambique owned by a Mozambican company in which Lonrho, a British-based multinational conglomerate, had a controlling interest. The pipeline was closed in 1966 as the result of UN sanctions, forcing the refinery also to cease operating; subsequently the major owners of the refinery removed a large part of the equipment to South Africa for use there. During UDI, oil imports came largely through South Africa. They appear to have been generally adequate and to have met all essential requirements, assisted by rationing and other measures, such as the rehabilitation of steam locomotives by Rhodesia Railways to replace diesel locomotion. Consumption rose to over 760,000 tons in 1975 but declined thereafter, averaging about 650,000 tons annually through 1980. In 1980 steps were taken to get the pipeline and refinery back into operation. About forty kilometers of the pipeline had to be relaid and maintenance carried out on the line's two pumping stations. This work and testing of the line were completed in 1981, and by the end of the year the system was reportedly ready for commercial operations. Restoration of the refinery has proceeded much more slowly. In March 1981 a report by CAPREF indicated that the plant could not be ready before late 1982. The government repeatedly expressed strong dissatisfaction at the rate of progress, and in early 1982 it was reported that the new Zimbabwe Oil Procurement Consortium (ZOPCO) had taken over the oil depot and facilities at the refinery and would handle gasoline and diesel fuel imported through the pipeline. An agreement on royalties to be paid to Mozambique on quantities transported was made between Zimbabwe and Mozambique in March 1982, after several months of negotiations, and agreement on Lonrho's charges was reached in midyear. Meanwhile gasoline was sent by rail from Beira to Mutare, and diesel fuel came by rail from South Africa. The petroleum products received through the pipeline, which went into operation in July, were being marketed by the several oil companies, including Shell, BP, CALTEX, and the French-owned Total, which have regularly distributed them. The pipeline's throughput capacity of about 1 million tons per year well exceeded anticipated total annual consumption of approximately 650,000 tons. Minor sabotage of the pipeline by an insurgent force in Mozambique, known as the Mozambique National Resistance (Resistencia National Mocambicana-RNM), had been reported after its reopening, but the damage had been quickly repaired. There was concern, however, that major supply problems would occur if pumping stations or the storage facilities in Beira were damaged.