Government signed $5,2 billion deal with a South African company -- Nkosikhona Holdings -- that will see the country produce over 8 million litres of liquid fuels per day from coal in Lisulu, Hwangwe.
The deal will be actualised under a Memorandum of Understanding (MoU) signed between Verify Engineering Private Limited, an agent of the Ministry of Higher and Tertiary Education, Science and Technology Development and Nkosikhona Holdings yesterday.
The deal will see the beneficiation of coal for the production of liquid fuels, fertilisers and chemicals.
It also covers coal production and the setting up of the beneficiation plant.
The plant will be established in the Lisungu area of the Zambezi basin where coal is available in abundance.
The signing ceremony was witnessed by President Mnangagwa, Higher and Tertiary Education, Science and Technology Development Minister Professor Amon Murwira, whose ministry owns Verify Engineering company, Chief Secretary to the President and Cabinet Dr Misheck Sibanda, Energy and Power Development Minister Ambassador Simon Khaya Moyo, Permanent Secretary Dr Desire Sibanda and chief executive officer of Nkosikhona Holdings, Jaco Immink and Engineer Pedzisai Tapfumaneyi of Verify Engineering.
The project has a potential to produce 8 million litres of various forms of liquid fuels daily against the national consumption of about five million litres a day.
It will produce fuels and energy products like petrol, diesel, gas, oxygen, waxes, compounds for agriculture such as fertilisers, tar for the roads and solvents like plastics.
It is premised on a build-operate arrangement.
A ground breaking ceremony for the plant is scheduled for June 1 this year while mining operations will start in September.
It will take at least three and a half years before the country starts benefiting from the value addition and beneficiation.
The project will operate under the joint venture company, Vectol Zimbabwe (Pvt) Ltd.
Speaking after the signing ceremony at his Munhumutapa office, President Mnangagwa said the project fell within the country's values on FDIs, public private partnerships and joint ventures.
President Mnangagwa said such arrangements would result in economic development.
He said the coal to liquid project was a good example of commodity based industrialisation in value addition.
"My Government fully endorses this project and has granted it national project status. I am confident that it will contribute to our energy, security and self-sufficiency in terms of liquid fuels, fertilisers and a range of other chemicals," said President Mnangagwa.
He said the project was envisaged to create employment, stimulate productivity and growth of other sectors such as agriculture, manufacturing and mining while enhancing the country's human resources' skills base in the particular field.
President Mnangagwa commended the Ministry of Higher and Tertiary Education, Science and Technology Development for advocating for greater use and application of science and technology in stimulating the country's economic growth and development.
He said he was pleased to witness the signing ceremony since Nkosikhona Holdings only expressed its interest to invest in the country on March 9 this year during the infrastructure conference hosted by the Ministry of Higher and Tertiary Education, Science and Technology Development.
He urged the parties to implement the project with the zeal to meet set deadlines.
"I urge both entities to proceed to implement this project with zeal guided by clear and definite timelines. My Government will not accommodate undue delays in the implementation of national projects that has national status," said President Mnangagwa.
Higher and Tertiary Education, Science and Technology Development Minister Professor Amon Murwira said Government's vision to move his ministry from a social case to a business one was bearing fruits.
He said the coal to liquid project was one of the many projects the Ministry was working on to translate knowledge into goods and services through the use of natural heritage.
"We have got lots of coal reserves on the African continent. These reserves are now being used for the development of the country," said Minister Murwira.
Nkosikhona Holdings chief executive officer Mr Jaco Immink said they took advantage of Government's Zimbabwe is open for business mantra to invest in the country.
"It was said that the doors will be opened and accordingly, it is my great pleasure and honour on behalf of Nkosikona Holdings and the Magcor Consortium Group of Companies to acknowledge that we have indeed answered the call," said Mr Immink.
Mr Immink said Vectol Zimbabwe (Pvt) Ltd will not only provide employment opportunities for Zimbabweans during construction but even after through technical and administrative opportunities in line with the company's motto 'shifting horizons'.
He said the project will stimulate the economy, generate critical employment and revenue.