ZIM’s sole ammonium nitrate (AN) fertiliser manufacturer, Sable Chemicals, has shut down operations at its electrolysis plant owing to the gnawing power shortages in the country.
The company, based in Kwekwe, about 210km southwest of Harare, at its peak consumed 80 megawatts (MW) of power before it was forced to halve the consumption when it shut down five of its 10 units.
Zimbabwe’s power utility, ZESA Holdings, further reduced supplies to the company, thereby forcing it to shut down operations.
Sable Chemicals company secretary Victor Makoni on Friday said in the short term, the company would “immediately adopt a business model that depends on manufacturing AN using imported ammonia to ensure adequate supplies of AN in Zimbabwe”.
Makoni said the decision to take Sable off the national power grid was reached after management held a meeting with the government and the power utility.
The Sable ammonia manufacturing plants are dependent on the power intensive electrolysis technology.
The hydrogen required for the production of ammonia at the plant is produced from electrolysis technology, which accounts for 90% of the electricity used at Sable.
The company has been using the “preferential tariff” to buy power from ZESA Holdings at five cents per kilowatt hour when the industrial rate is 11 cents per kilowatt hour.
“Sable has an installed capacity to produce 240,000 tonnes of AN per annum. This volume is produced using 115,000 tonnes of ammonia, of which 72,000 tonnes is produced at the factory in Kwekwe, and the balance of 43,000 is imported from South Africa,” Makoni said.
He said Sable would, in the meantime, pursue the long-term plans to migrate to a technology that manufactures AN using less power intensive methodology.
“To this end, feasibility studies have been done to evaluate the commercial viability of using coal bed methane (CBM). The results of these studies are positive. Migration to new technology will take some time,” Makoni said.
The company could have immediately started importing ammonia, but cannot as it is owed over US$200 million by government.
Sable Chemicals director Jack Murehwa said in three years the company would retire the electrolysis plant and turn to CBM to produce ammonium from the Lupane gas.
It is estimated that there could be in excess of 765 billion cubic metres of sulphur-free CBM in Lupane and Murehwa said they had found partners to run the gas project.
“We are now running with the Lupane gas fields development so that we use it here,” he said.
Energy and Power Development minister Samuel Undenge, speaking on Friday at the Zimbabwe Mining and Infrastructure Indaba 2015, urged companies to import their own power or build smaller power stations.
He said it was not only his ministry of government’s responsibility to generate but, but a collective one.
“The private sector, in particular the mining sector, (can) import power, but should not only import power. I urge you as mining companies to enter into the generation of power itself,” Undenge said.
He said if the resources were pooled together, companies would generate power in the region of 600MW, adding power-importing companies would be expected to pay “a wheeling charge to the Zimbabwe Electricity Transmission and Distribution Company for the use of their lines”. – ANA