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Lovemore Zigara Midlands Correspondent
THE government might assist troubled Sable Chemicals in settling its $150 million electricity arrears to Zesa. The country’s sole Ammonium Nitrate (AN) fertilizer manufacturer could heave a sigh of relief should the government’s pledge go ahead.

The government had agreed to offset the debt to ensure Sable Chemicals remains viable before it was switched off from the national grid recently.

Discussions between government, the power utility and Sable Chemicals in 2009 culminated in government supporting a tariff of 3c/ kilowatt per hour (kWh) while it took responsibility for the 9c/kWh to meet the commercial Zesa tariff of 12c/kWh.

Speaking at a familiarisation tour of the new operations of Sable Chemicals at its plant near Kwekwe, Industry and Commerce Minister Mike Bimha said discussions with the Ministry of Finance to ensure that the debt was cleared were on.

“I’m fully aware of the government’s commitment with respect to the special power tariff that had been in place until recently. I’m currently talking to my colleagues in Treasury to ensure that those obligations are met,” said Bimha.

“The negotiations also involve the Ministry of Energy and Power Development and what I can announce now is that they’re at an advanced stage.”

The minister pledged to keep on supporting the fertilizer manufacturer, which he described as an “important cog in our economy from several viewpoints”.

Meanwhile, Sable Chemicals chief executive officer Jack Murehwa said feasibility studies for the factory and pipeline to channel gas from Lupane to Kwekwe is complete with work still underway on concept proving of Coal Bed Methane (CBM) and gas field development in Lupane.

He said a ground breaking ceremony for the commissioning of the project would take place in three to four years subject to the establishment of gas mines in Lupane by other players.

“We’re pleased to learn from the budget presentation yesterday (Thursday) that the Minister of Finance and Economic Development (Patrick Chinamasa) said progress on this has been made and an investor has completed exploration of Dandanda, Lupane and Binga areas and plans to invest over $2, 01 billion towards the setting up of gas mines are underway,” said Murehwa.

“Through an off take agreement, the new Sable project will become a reality. From ground breaking to commissioning, this project will take three to four years. We’ll therefore endeavour to put all our efforts to ensure that the ground breaking date for this project happens in the shortest possible time.”

Meanwhile, the company will continue importing ammonia, a major component in the manufacture of AN fertilizer.

Murehwa said Sable was set to increase its complement of tankers from 82 to 94 by the first half of next year while an additional 55 will be purchased by year end.

This, he said, would also raise production of fertilizer and go a long way in reducing the price of the commodity on the market.

“Since the discontinuance of the electrolysis based ammonia manufacture facilities, Sable has produced a new business model that ensures production of AN fertiliser at the Sable Factory.

In the short to medium – term, the model will be based on total importation of ammonia.

“At the present moment Sable has 82 tankers that are rolling and these tankers will increase to 94 by mid 2016. Sable has also secured funding to purchase an additional 55 tankers to make them 149 by the end of the year.

“Based on this model, continued production is going to ensure that there’s enough fertilizer in the country into the future.

“Production is going to continue to increase as additional funding is channelled towards the purchasing of more tankers thereby increasing the total volume of AN fertiliser that can be produced at Sable.”

The company has a design capacity to produce 240, 000 tonnes of fertilizer per annum if operating at full throttle.