Hwange of Zimbabwe Coal Output to Surge on Underground Mining

(Bloomberg) -- Hwange Colliery Co. expects to boost underground coal production five-fold this month when it restarts operations after a two-year hiatus, a company official said.

The resumption will help the loss-making company tap more lucrative deposits of coking coal, used to make steel, as it seeks to report its first profit since 2012. Zimbabwean miners who produced 2 million tons of coal last year are targeting 10 million tons of output in two years, which would enable them to begin exporting the fuel.

Underground mining will restart at Hwange once remaining pieces of equipment have been delivered, acting Managing Director Shepard Manamike said in an interview Monday in the capital, Harare. Operations were halted in 2016 when a machine known as a continuous miner broke down.

“We will now be ramping up production to 50,000 tons a month from 10,000 tons, which we were producing in December, as we are now resuming underground mining,” Manamike said. “The resumption of underground mining will cost $5 million in capital equipment.”

Zimbabwe has five coal-mining companies that supply coal to state-owned Zimbabwe Power Co., which requires 240,000 tons of the fuel a month. Hwange produced 232,000 tons of coal from opencast operations in the first quarter, more than double the amount a year earlier.

To contact the reporter on this story: Godfrey Marawanyika in Harare at gmarawanyika@bloomberg.net

To contact the editors responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net, Paul Richardson, John Bowker

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