Lafarge Zimbabwe has completed the construction of a new mill that will double its cement manufacturing capacity at its Manresa plant, but it cannot use the new grinding system because it owes the supplier US$5.2m, according to the online news service the Insider.
The new vertical cement mill is part of a US$25m investment in expansion by Lafarge and will increase capacity from 450,000tpa of cement to 1Mta. But the company that built the US$15m plant, CBMI of China, will only fully hand over the plant once Lafarge pays the US$5.2m outstanding for the project.
"We currently owe them US$5.2m because of the shortages that are happening in our market. Government has not been able to disburse the funds to CBMI of China," Lafarge Zimbabwe CEO, Geoffrey Ndugwa, told a group of MPs.
“The current risk today is that the new plant has not been officially handed over to us by CBMI. We do not have control as Lafarge at the moment. We cannot obtain a certificate of completion before the debt owed is serviced.”
Germany’s Gebr Pfeiffer supplied the vertical roller mill, which has a capacity of over 94tph. The payment delays reflect the problems faced by many manufacturers in Zimbabwe as they try to pay for equipment to expand capacity. The CBMI debt could also delay Fossil Mining's takeover of Lafarge, which was announced earlier this year.
