ZimCoke (Pvt) Limited plans to invest $133 million towards resuscitation of the Coke Oven Battery plant segment of the defunct steelmaker, ZiscoSteel.
At full tilt the project is expected to produce 500 000 tonnes of coke annually, for both local usage and the export markets.
ZimCoke chief executive officer Bill Moore, said the resuscitation of the plant will begin with the operationalisation of the Coke Oven Battery Number 3.
“In Phase 1 of the ZimCoke operation will be the rehabilitation of Coke Oven Battery Number 3 with the by-products plant. This will produce between 250 000 and 300 000 tonnes of coke per annum and produce export sales of $65 million,” he said at the groundbreaking ceremony on Friday.
“Phases 2 and 3, will each add a further 125 000 tonnes so that in full production ZimCoke will manufacture at least 500 000 tonnes of coke a year.”
ZimCoke (Pvt) Ltd and ZiscoSteel signed an agreement of sale last year, whereby ZimCoke acquired the coke-making assets of ZiscoSteel, consisting of the plant and machinery, land and buildings and associated infrastructure of coal handling and rail wagons.
Mr Moore said ZimCoke already has an off-take arrangement with Glencore. Coke is a fuel with a high carbon content and few impurities, made by heating coal in the absence of air. It is the solid carbonaceous material derived from destructive distillation of low-ash, low-sulphur bituminous coal.
While coke can be formed naturally, the commonly used form is synthetic. The form known as petroleum coke, or pet coke, is derived from oil refinery coker units or other cracking processes.
The fuel is used in preparation of producer gas which is a mixture of carbon monoxide (CO) and nitrogen (N2). Producer gas is produced by passing air over red-hot coke. Coke is also used to manufacture water gas.
Speaking at the same event Industry, Commerce and Enterprise Development Minister Mike Bimha, said the revival of the Coke Oven Battery marks the beginning of the resuscitation of the ZiscoSteel, which he said will be carried out in phases.
In August last year, the Government signed a $1 billion deal with Chinese investor, Zhang Li through his company, R&F for the resuscitation of ZiscoSteel.
“This event entails also the resuscitation of ZiscoSteel. As you may be aware that agreements have already been signed with the potential investor to rehabilitate ZiscoSteel. The action plan for the resuscitation of the steel giant is already in place,” he said.
“Also this is a different investment structure than before. This is evidenced by hiving off of the Coke ovens which are to be operated by ZimCoke. This gives us confidence that this time the project will be a success. In addition, there are also other investors who are coming in to operationalise Lancahsire Steel. This will mark the resuscitation of the iron and steel value chains in the country.”
The revived coke oven plant is expected to employ 500 people, while the full resuscitation of ZiscoSteel is expected to employ 3 000 people directly.
The ZimCoke project is expected to have strong forward and backward linkages.
“The project will have ripple effects on the engineering, chemical processing and road-making industries. Coking coal supplies will be sourced from Hwange and a supply contract is being negotiated. Transportation of the coal from Hwange to ZimCoke and from ZimCoke to South Africa will be by rail. This will benefit the National Railways of Zimbabwe and the Ministry of Transport with respect to capacity and rates,” said Minister Bimha.