Dinson Iron and Steel Company (DISCO) (Pvt) (Ltd) is set to invest US$750 million in the Greenfield Integrated Iron and Steel plant project, alongside mining of iron in the Chivhu and Chirumanzu Districts.
This was revealed during the twelfth Cabinet Press Briefing yesterday, by the Minister of Information, Publicity and Broadcasting Services, Senator Monica Mutsvangwa.
“Dinson Iron and Steel Company is setting up a Greenfield Integrated Iron and Steel plant, alongside mining of iron in the Chivhu District of Mashonaland East Province and Chirumanzu District of the Midlands Province.
“The USD750 million investment will significantly contribute to the country’s economic growth. DISCO has accordingly applied to be connected to the national grid in order to access the requisite power for its plant’s operations. The electricity transmission line will stretch from the Kwekwe-Sherwood Substation to DISCO’s iron and steel manufacturing plant at Manhize in Chivhu,”said Mutsvangwa.
Minister Mutsvangwa said that in order to finance this connection, Zimbabwe Electricity Distribution Company (ZETDC) will enter into a Public Private Partnership (PPP) agreement whereby DISCO will pre-finance both phases of the construction project, as a loan to the utility company.
She said that the loan will be recovered from ZETDC through deductions from DISCO's monthly bills until the loan is paid up, over an estimated 5-year period.
“Cabinet invites the public to note that this electricity line will not only be dedicated to DISCO, but will also be available to other ZETDC customers along the way. In terms of the PPP, the utility will use 40% of the electricity.
“During Phase 1 of the project, DISCO will require only a fraction of its 60% allocation, leaving the rest available to ZETDC. The partnership will therefore allow DISCO to access a reliable and regular supply of power from ZETDC for their iron mining and processing operations on time. Local communities will benefit by receiving consistent power supplies,” added Minister Mutsvangwa.
Meanwhile, Cabinet approved the Electricity Bill which introduces stiffer penalties for the abstraction and diversion or use of such electricity knowing that it was illegally connected. She said that the Bill removes the option of a fine where one is convicted of such crime, adding that ZESA is suffering huge losses due to theft and vandalism, resulting in huge losses of revenue meant for development.