Asbestos industry faces collapse

10 May, 2019 - 00:05 0 Views
Asbestos industry faces collapse

eBusiness Weekly

Martin Kadzere
Shabanie and Gaths mines might have reached a stage where re-opening them may no longer be feasible given the high levels of structural weaknesses and the huge capital outlay that may be required to resuscitate operations against low global demand for the fibre, a situation that makes the process likely uneconomic, Business Weekly can reveal.

Mining experts, who at some point were involved in efforts to resuscitate Zimbabwe’s sole asbestos mines — which was shutdown in 2004 due to mounting debts and corporate conflicts — said the cost for reviving the mines “might not make economic sense” due to the huge capital outlay needed and low demand for the commodity on global markets.

Instead, indications are that Government might need to concentrate on the dumps for the small local market as challenges on the ground “are clear” that reviving the mines might not be feasible.

Companies such as Turnall are now importing the fibre from Eastern European countries including Khazakstan. The closure of the mines about two decades ago left over 3 000 employees jobless with some of them having already reached retirement age. Shabanie and Gaths mines are owned by SMM Holdings, previously owned by self-exiled businessman Mutumwa Mawere.  Shabanie and Gaths mines are in Zvishavane and Mashava, respectively.

A number of investors have previously been linked with the efforts to resuscitate the two asbestos former giants over the past few years, but nothing tangible materialised in this regard.

“It will be quite difficult to re-open the mines from a technical and financial perspective,” said one mining expert with the Ministry of Mines and Mining Development.

According to SMM, about US$120 million is needed to revive Shabanie and Gaths mines.

Minister of Mines and Mining Development Winston Chitando, this week said he would need a technical appraisal from his engineers before commenting on the matter.

He, however, said the de-watering exercise, which SMM started last year, was ongoing. After the mines ceased operations, there was no proper care and maintenance, resulting in both mines flooding, thus submerging equipment all critical infrastructure.

SMM general manager Chirandu Dhlembeu, could not be reached for a comment yesterday.

Structural challenges
The experts said the mines had suffered fatal geotechnical failures such as roof collapses, which makes it difficult “if not impossible” to access critical mining levels.

“Similarly flooding will cause similar rock strata stability challenges, which calls for huge capital to reopen the mines,” said the expert who requested not to be named.

Sources at Gaths mine said the top three levels have since collapsed due to flooding of the mines.

Viability challenges
With the mines’ installed capacity said to be between 150 000 tonnes and 180 000 tonnes per year, the Minerals and Marketing Corporation of Zimbabwe, a Government agency charged with marketing of the minerals expect for gold and silver is understood to have confirmed a realistic market available for the local fibre to be 50 000 tonnes per year.

Given such background, questions have been raised over how the mines could be re-opened and operate viably at appropriate unit cost efficiencies even on reduced times a month.

In addition, the experts said the tonnage for available market is said to be largely for short fibre used for roofing sheets. As such the mines must target less value short fibres.

“Looking at the above challenges on the back of cheaper fibre from Russia, it is not becoming clear that the mines are now beyond reopening stage and that the Government must now have courage and wind down the assets and perhaps concentrate on dumps for the small local market,” the expert said.

“Workers and the local community can then deal with reality as it is now just about 21 years since the mines shut down, but with the ministry position strangely remaining one of the mines will reopen soon.”

Some mining analysts said while investors might be invited to start greenfield projects, given huge mineral deposit of asbestos, the market for the fibre continues shrinking.

“You may start afresh and put smaller amount of capital; but when you look at the 50 000 tonnes market, it might not be feasible to start a viable project.

“The challenge will be on paying back the capital,” said a mining analyst with a local research firm.

Global ban lobby
Compounding challenges related to the re-opening of the mines are that few potential investors are keen on going into asbestos mining on the back of the lobby to ban the mineral.

Health authorities around the world have long advocated against the use of asbestos, saying it posed health risks when the silky fibres that make up the mineral get into the air that people breathe.

When inhaled in significant quantities, asbestos fibres can cause a scarring of the lungs that impedes breathing; mesothelioma, a rare cancer of the lining of the chest or abdominal cavity; and lung cancer.

Asbestos, which is widely used in the construction and other industries has been banned in many developed countries, including the European Union. In some countries, such as Canada its use is strictly controlled through the laws, according to reports.

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