Zimbabwe News and Internet Radio

Makomo, Zambezi Gas resolve concession dispute

By Oliver Kazunga

Zambezi Gas and Makomo Resources have resolved a long-standing concession dispute the two Matabeleland North-based coal mining companies were embroiled in.

Makomo Resources
Makomo Resources

In 2018, Zambezi Gas implored the Government to resolve the dispute in which it was accusing Makomo Resources of encroaching into 11 200 hectares of its concession in Hwange after negotiations for a joint venture between the two firms collapsed.

As a result of the dispute, Zambezi Gas, which owns a 19 200ha concession in Entuba coalfields, was only able to access 8 000ha. Zambezi Gas chief executive officer Mr Thomas Nherera told Business Chronicle that their dispute with Makomo was now water under the bridge.

“The dispute has been resolved. They had mined a portion of the area (Zambezi concession). But now the boundary issues have been sorted out, they are our good neighbours.

“It happens with neighbours but you discuss and you don’t necessarily have to go to court but you discuss ways of resolving disputes,” he said.

The proposed joint venture deal fell through when Makomo Resources shareholders proposed to give Zambezi Gas 45 percent stake in the strategic partnership project while the former would retain 55 percent.

Zambezi Gas rejected the arrangement as they took into account that they were the first to explore the Entuba coalfields area well before any other investor knew that the area had coal.

Meanwhile, Zambezi Gas, which is presently producing 200 000 tonnes of coal from opencast operations targets to increase output to over 250 000 tonnes.

Zambezi Gas and Makomo have of late become the major coal producers in the country taking over from Hwange Colliery Company Limited (HCCL), which was placed under administration by Government in 2018.

HCCL, which continues to face viability concerns was placed under administration in terms of Reconstruction of State Indebted Companies Act (Chapter 24:27).

Once Zimbabwe’s major coal producer, HCCL is not yet out of the woods despite recording a 50 percent increase in coal production to 175 849 tonnes in the first quarter ended March 31, 2020. In the corresponding period last year, the colliery produced 117 165 tonnes. The Chronicle