How Zimbabwe’s failure to fix NRZ rot is derailing the country’s mining ambitions

Zimbabwe is looking to its mining industry to lead an economic recovery, but the government’s own failure to invest in the country’s rail system is pushing those ambitions offtrack.

Because the government is not investing enough in rail, mining companies now have to pay the National Railways of Zimbabwe (NRZ) to fix its broken-down locomotives and wagons to make them usable. Appearing before Parliament’s portfolio committee on transport on Monday, NRZ general manager Respina Zinyanduko laid out the rot.

All equipment has long passed its sell-by date. The last set of wagons was bought in 1992, and among the few locomotives still running are some that are 40 years old – almost twice their lifespan.

“Lack of recapitalisation in both equipment and infrastructure has affected the company’s performance, which has seen business volumes coming down from the 12 million tonnes it used to move annually in the 1990s to the current level of 2.3 million tonnes,” Zinyanduko told the MPs.

According to Zinyanduko, “other governments such as Mozambique, South Africa, Namibia, Tanzania, Kenya and lately Zambia are funding their railway companies,” while, in Zimbabwe what little money is coming from the government is being eroded by inflation.

“In 2022, NRZ was allocated Z$2 billion which as at date of allocation was equivalent to US$20 million but now it is equivalent around to US$3 million and the money is still to be disbursed,” Zinyanduko said.

The company cannot even replace track ballast, the rocks on which rail tracks sit. This makes operating the trains dangerous.

“It is one of the major causes of derailments on our tracks,” Zinyanduko said.

Vandals and thieves have stolen railway infrastructure worth US$3.6 million in the last five years, with gold panners doing the most damage, she said.

NRZ losing millions to thieves and vandals


What are miners doing?

Mining companies need working rail to move products to export markets efficiently. But they now have to incur an extra cost; companies are putting in money to fix NRZ’s broken-down trains so that they are usable.

Among the deals that NRZ is discussing with mining companies:

  • Zimasco, one of the country’s biggest ferrochrome producers, plans to spend US$2.46 million to refurbish 100 wagons and six NRZ locomotives. In exchange, these trains will be dedicated to Zimasco traffic, although they can be used by other customers when Zimasco doesn’t need them.
  • Gas importer ZimGas will put up US$390, 000 to refurbish 26 gas tanks to move gas.
  • African Rail Company is to refurbish 100 tanks to move fuel from Maputo
  • Rabb Africa, a company that maintains and leases trains, has been contracted by lithium producers in Zimbabwe to ship lithium concentrate exports. The company and NRZ are discussing a draft agreement on wagons and locomotives.
  • Samplestone Mining will refurbish 6 locomotives and 600 wagons so that it can move coke and coking coal to Maputo.
  • Great Lakes Lion is to spend US$14.8 million on wagon refurbishment so that it can move coal to Maputo “Client has indicated that they want to refurbish wagons in batches of 80 wagons,” NRZ says.
  • Silvergill Mineral Hub, which will consolidate chrome from small players for export, is also working on a deal for wagons. Another company, Makuwe Engineering, plans to spend $2 million to fix nine locomotives and 100 wagons for iron ore exports to Maputo

The absence of efficient rail is an obstacle that Tsingshan, which is building a 1-million-tonne-per-year steel plant at Manhize, near Mvuma, will have to overcome. In the MoU signed with the government for the project is a plan to rehabilitate some 1,000 km of rail. For the Manhize project to run efficiently, it would need to fix the rail line from Hwange – the source of the coal it will use – to the Mvuma site and, eventually, a dedicated line onward to Beira.

Last year, Contango, a UK company that is developing a new coal mine in Lubu, Hwange, said there was growing demand for coal abroad, but it had to find ways of getting around the rail problem.

Says Contango: “The Company expects that thermal coal could generate margins of over US$100 per tonne. This could be further improved in the event the company is successful in its current efforts to secure a rail transport solution rather than trucking to port.”

ALSO READ | TIMELINE | NRZ’s tortured journey to nowhere