Mega titanium project kicks off

Business Reporter

NYANZA Light Metals has started building a US$350 million titanium dioxide plant in Richards Bay, South Africa, chief executive Donovan Chimhandamba said.

Nyanza’s world class chemical and mineral beneficiation complex will produce primarily 80 000 tonnes per annum of titanium dioxide mainly used in the manufacturing of industrial coatings, paints, cosmetics, paper, plastics, and other food ingredients.

Nyanza is a private joint venture between investors from Zimbabwe, South Africa and the South African government. Nyanza construction rollout is divided into three phases. Phase 1, which commenced in May 2021 involves the construction of the Technical Services Centre that will produce sufficient titanium pigment used for ongoing customer and product development work. This phase 1 plant is almost complete and will be commissioned by March 2022

 “There have been challenges but we have definitely progressed,” Mr Chimhandamba told the CNBC Africa television network last week. We are looking quite good, but there have been challenges, we have obviously felt the disruptions caused by Covid-19 but I think we are looking much stronger than we were pre-Covid.”

Mr Chimhandamba said titanium dioxide pigment was “a white chemical powder used in anything that has colour except black. 

It provides a white base to make all other colours. 

The African Export-Import Bank (Afreximbank) has provided project preparation funding of US$2 million while retaining the role of lead arranger co-ordinating all other banks that are syndicating finances for the US$350 million funding for phase-2 construction of the project.

South Africa, and in particular the KwaZulu Natal province, holds a huge resource of titanium mineral sands. While KZN is endowed with the primary titanium primary raw minerals, South Africa and Africa at large import 100 percent of the value-added titanium-related products as there is no value addition capacity locally or on the continent.

Nyanza’s complex occupies 67 hectares of land of which 45 hectares would be fully built with massive industrial operations including 15MW of solar and steam-fired power plants.

The chemical project will employ more than 1 200 people during a construction period spanning 30 months, and once fully commissioned, will employ 550 permanent staff.

South Africa imports 100 percent of the high value titanium dioxide pigment from America, Asia and Europe which relies on raw materials from South Africa and Africa.

“We saw this as an opportunity to create a project that would leverage on South Africa and KZN’s natural resource endowment and demonstrate that we as Africans, can create transformative projects and move the continent from just being an exporter of low value primary raw materials to becoming an exporter of high value-added products,” Mr Chimhandamba told a KZN trade and investment conference last week.

The South African government through the Department of Trade, Industry and Competition has boosted Nyanza’s project by availing special incentives including Special Economic Zone listing, early-stage project development and preparation incentives, R900 million tax allowance, which will allow the investors to recoup their investment much quicker, and training allowances to support faster skills transfer and training.

“The project being in the Special Economic Zone will enjoy special income tax incentives such as income tax rate of 15 percent compared to 28 percent outside the zones which boosts financial returns, accelerated depreciation and pre-cleared customs area and 10 percent duty protection on titanium dioxide pigment imported,” said Mr Chimhandamba, who also leads Diaspora Infrastructure Development Group, a consortium which won a tender to revive the National Railways of Zimbabwe in 2017 before it was terminated.

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