RioZim said in the absence of being allowed to retain 100 percent of its export proceeds, the company's position will continue to be extremely challenging. Photo: Reuters

DURBAN – Gold production from RioZim, one of the biggest producers of the precious metal in Zimbabwe, has declined by 8 percent against the backdrop of further disruptions to power supplies and fiscal challenges that have left miners’ cost structures affected in an economy battling currency issues.

As a direct result of power cuts, the group recorded a production decrease of 8 percent.

“In the absence of being allowed to retain 100 percent of its export proceeds, the company's position will continue to be extremely challenging,” said RioZim chairperson Rashid Beebeejaun yesterday.

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RioZim, which has about three gold properties in Zimbabwe, saw production for the half-year to June 2019 decline from 1 050kg to 962kg, it said yesterday after publishing delayed financials. Its gold mines experienced “acute power cuts” despite “paying for uninterrupted power supply in US dollars”. The other mine was also hobbled by “plant breakdowns” which reduced production processing time.

Its diamond venture, Murowa, raised gem production by 16 percent to 390 000 carats for the same period.

The company is battling to strike the right deal for financing of its 2 800MW Senga coal power station and a 178MW solar project to halt the disruptions from power outages. It has completed bankable feasibility studies for the Senga power plant, which also encompasses a coal mine and transmission lines as well as for the solar project.

RioZim last year closed three of its mines – Cam and Motor, Dalny and Renco – in Zimbabwe after running out of consumables and spare parts.

BUSINESS REPORT