By Munyaradzi Musiiwa
Essar Holdings has agreed to immediately inject money into Lancashire Steel and production is expected within the next six months, deputy Minister of Industry and Commerce Chiratidzo Mabuwa has said. Lancaster Steel is a subsidiary of NewZim Steel.
It closed in 2010 due to the shortage of raw materials after the mother company Zisco indefinitely suspended operations.
Speaking at the Confederation of Zimbabwe Industries (CZI) workshop on the Zimbabwe Agenda for Sustainable Socio-Economic Transformation on Monday, Mabuwa said Essar would soon inject money into Lancashire for the importation of feed stock.
“Essar is going to inject money into the project, particularly towards Lancashire Steel for the immediate revival and to commence operations using imported feed stock over the course of six months,” she said.
Mabuwa said the resuscitation of NewZim Steel was also imminent following the completion of the revival plan.
“There have been problems that were not clear to Essar at the time of the signing of the deal. There was, however, the reconsiderations of all the grey areas that had not been looked at initially and Essar representatives met President Mugabe and recommitted themselves.
“They agreed on three specific implementation issues which are revising the revival plan, immediate relief to workers and plans and modalities for the settlement of local creditors. Essar has agreed to implement the interim measures,” she said.
Mabuwa said Essar had already engaged Chinese and Indian engineering procurement and construction contractors to commence work on the ground based on the adjusted revival plan.
“The date of the first production remains unchanged. Essar has also commenced the construction of a thermal power plant. They have also given support to workers by availing money for schools fees for the workers’ children,” Mabuwa said.
“The company had also inherited the debt of loans that were extended to workers by the Commercial Bank of Zimbabwe (CBZ) following reports that workers’ properties were now being attached.”
She said the skills review assessment was already underway to evaluate the number of workers that could be taken onboard.
Ziscosteel stopped operations in 2008 because of viability challenges and debts.
