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Hwange Colliery Company Limited (HCCL) production levels have gone up by 35 percent

Oliver Kazunga,Senior Business Reporter
HWANGE Colliery Company Limited (HCCL) has increased output by 35 percent to 230 000 tonnes in June from about 170 000 tonnes in May, managing director Engineer Thomas Makore said.

In a telephone interview from Harare after the company’s annual general meeting (AGM) last Friday, Engineer Makore said: “All the ordinary resolutions have been approved during our AGM. It also emerged that our production levels for this month (June) as of today, increased to 230 000 tonnes. The increase in productivity is largely due to employee management programme aimed at motivating the workers.”

In April, creditors of the troubled HCCL voted in favour of the Scheme of Arrangement that has provided a framework for the company to settle its $352 million debt.

“Our Scheme of Arrangement is progressing well following the recent implementation. We are now verifying the balances from the preferred creditors,” said Mr Makore.

Last month, the company paid the workers seven percent of their outstanding salaries in line with the Scheme of Arrangement.

At the beginning of the year, the workers were said to be owed a cumulative $80 million, which Engineer Makore said the company was working to reduce.
Once Zimbabwe’s largest coal producer, HCCL presently employs about 2 300 people. Through the Scheme of Arrangement, the colliery has among others managed to stop litigations and writs of executions, which had crippled the company’s operations.

The firm is now able to borrow money for working capital.  Coal output at Hwange had plummeted to about 30 000 tonnes per month before the implementation of the scheme.

As part of the turnaround strategy, the coal miner has also secured two 25-year coal supply agreements with the Zimbabwe Power Company and an independent power producer, Lusulu Power in Matabeleland North.

The agreements, which would see 400 million tonnes of coal per month, were part of the initiatives to support and sustain HCCL’s turnaround strategy.
In 2015, the Government granted HCCL three new concessions in Western Area, Lubimbi East and West.

The new concessions, which are expected to prolong the lifespan of Hwange by 50-70 years, have an estimated resource of about 750 million tonnes of mainly coking coal and thermal coal.

HCCL targets to improve production volumes to about 500 000 tonnes per month in the long-term. — @okazunga