By Lovemore Zigara
ESSAR Holdings is allegedly trying to wean Redcliff Municipality off their joint treated water account by requesting to be billed separately.
The steel conglomerate which snapped up a majority stake in New Zimsteel (formerly Ziscosteel) owes Kwekwe City Council over $13 million in outstanding water bills. New Zimsteel purchases treated water from Kwekwe for its plant and Redcliff town.
Kwekwe City Council has turned down the Essar Holdings request for separate billing demanding that the steel company should first clear its arrears before its request could be considered.
Essar’s overtures to Kwekwe were apparently done without consultations with Redcliff Municipality which has a critical role of availing water to the town’s three suburbs of Torwood, Rutendo and Redcliff Low Density Suburb.
According to minutes of a Kwekwe full council meeting, New Zimsteel approached Kwekwe mayor, Councillor Matenda Madzoke to be billed separately from Redcliff municipality.
Clr Madzoke confirmed the developments.
He said the steelmaker should service its water bill first which stands at just over $13 million.
“I can confirm that New Zimsteel approached us with the intention to be billed separately from Redcliff Municipality and it was agreed in a full council meeting that they first need to service their water bill before we can make new arrangements.
“Once they fulfil their obligation, we can then send our engineers together with theirs to see the feasibility of such a project. Essar has advised us that they want to relinquish being the water authority of Redcliff because they want to focus on their core business of manufacturing steel,” said the Kwekwe mayor.
Redcliff mayor Clr Freddy Kapuya, professed ignorance over the development.
He said his council was not engaged by Essar on the issue.
Said Clr Kapuya: “We are not aware of those developments. Essar cannot negotiate with Kwekwe City Council behind our back because the issue of water is a tripartite arrangement which should be dealt with by all the concerned parties.”
In 2012, Kwekwe disconnected New Zimsteel over the outstanding water bill and it had to take the intervention of the Kwekwe district administrator, Ten Percent Mutikizizi to restore supplies.
New Zimsteel pledged to pay $5,000 monthly to service the bill but is said to have reneged on the undertaking without even paying an installment.
Government concluded the revival of the Redcliff steel company in May and a roadmap to resume production at New Zimsteel is already in place.
Essar Holding has agreed to inject funds into New Zimsteel subsidiary, Lancashire Steel, as part of the revival plan and production is expected to resume at the company in six months using imported feedstock.
There would also be importation of some steel products for resale at New Zimsteel’s distribution centres. Chronicle