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Oliver Kazunga, Senior Business Reporter

AIM-listed mining group, Vast Resources plc, says the ongoing 21-day national lockdown in the country has stalled finalisation of internal processes of the Chiadzwa Joint Venture Agreement. 

Last year, Vast Resources announced having signed a joint venture agreement with Chiadzwa Mineral Resources (PVT) Limited, a firm that represents Chiadzwa community in diamond mining in Manicaland.

In a statement, the mining group said on March 3, 2020 it confirmed receiving official communication that all internal processes leading to the conclusion of the Chiadzwa Community Joint Venture were expected to be finalised during the same month.

“Following the 23 March 2020 announcement the Zimbabwe Government declared a 21-day lockdown in response to the Covid-19 pandemic commencing on 30 March 2020.

“As a result of this the finalisation process was not completed in March, but finalisation remains expected to complete shortly,” it said.

Vast Resources operates mines in Romania and Zimbabwe. 

The mining concern is focused on the rapid advancement of high quality brownfield projects by recommencing production at previously producing mines in Romania and commencement of the joint venture mining agreement on the Chiadzwa Community Concession Block of the Chiadzwa Diamond Fields in Zimbabwe.

Vast Resources, which also operates gold mines in Zimbabwe, was granted mining rights under a joint venture arrangement with the Chiadzwa Community Development Trust to explore and mine diamonds in Manicaland.

Towards the end of 2019, the mining group also announced that it had secured US$13,5 million financing facility to cover costs of developing its joint venture diamond mining project in the Chiadzwa. 

Vast teamed up with the Chiadzwa community, creating a company called Katanga, which in turn partnered the Zimbabwe Consolidated Diamond Company (ZCDC) to mine diamonds.

It is hoped that the financing arrangement would cover the costs of reaching production at both the Baita Plai mine in Romania and the Chiadzwa diamond project in Zimbabwe. 

It is understood that a UK-based fund, Atlas Capital Markets, was to be issued with US$15 million of secured convertible bonds, which carried five percent interest per annum and would mature after two years.

The latest joint venture partnership between the ZCDC and Katanga is part of plans to increase Zimbabwe’s diamond output to 11 million carats per annum by 2023. 

Zimbabwe targets to transform the mining sector into a US$12 billion industry and diamonds are expected to weigh in with revenues of US$1 billion per annum.

-@okazunga