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Leonard Ncube recently in Hwange

COAL producer Makomo Resources says optimum pricing for its products is critical to meeting operational costs and increasing output to about 200 000 tonnes per month.

The coal mining giant recently scaled down production to 120 000 tonnes per month citing liquidity challenges.

The firm supplies coal to the country’s major power stations as well as South Mining, which produces coke.

Makomo general manager, Mr Kuda Nyabonda, said in an interview that the company was struggling with operational costs and hinted on a possibility of increasing the price of its coal.

“We’re still producing power coal for the power stations, that is, ZPC Hwange, Munyati, Bulawayo and Harare. At the moment our production is on the lower side not because of lack of capacity but because we were affected by costs of production,” he said. 

“We’re targeting to produce 200 tonnes per month and 80 percent of it will be power coal. We’ve been happy about our production levels and it’s only now when prices are low because of economic challenges that we have scaled down. 

“We buy spares from outside the country and that requires foreign currency hence we’re negotiating with our clients to adjust prices because if we don’t do that we will operate at a loss.”

Makomo Resources supplies mainly the local industry in Triangle, Delta and tobacco farmers and exports three percent of industrial coal to Zambia.

Demand for coal by small scale tobacco farmers, as reported by the Tobacco Industry and Marketing Board (TIMB) recently, will rise to 250 000 tonnes in five years hence the need for more coal. 

Makomo is one of the companies that have managed to manage environmental degradation around the communities they operate in.

Mr Nyabonda said the company has a continuous land rehabilitation policy whereby dugouts are refilled.

He said Makomo Resources plants a tree for every one thousand tonnes of coal extracted as the company complies with environment regulations. 

“To prevent water pollution, which has been a source of complaint by the Hwange community as Deka River is severely polluted by effluent from other mines, Mr Nyabonda said the coal miner had constructed some small dams on Lukosi River to stop pollutants from going downstream.

“We’re closer to Lukosi River and as way of mitigating contamination of the river we put some dams downstream from our premises. We also keep cattle and goats which feed around the mine so in the event of pollution it will be our own livestock that will be affected first,” added Mr Nyabonda.

Makomo started operations in 2010 and is owned by Zimbabwean and South African investors, with the neighbouring country holding a 40 percent stake.

— @ncubeleon.