Business magnate and TA Holdings chairman, Mr Shingi Mutasa still believes that Sable Chemicals remains a key institution in providing for the country’s nitrogenous fertiliser needs and is pleading for a viable electricity tariff for at least three years for the business to remain afloat.
In a statement accompanying TA Holdings year-end financials last week, Mr Mutasa said he still stands by the position he made 10 years ago that “Sable is pivotal to the mission of increasing fertiliser consumption at the lowest possible foreign exchange cost to Zimbabwe”.
“If Sable did not exist, Zimbabwe would have to satisfy all its nitrogenous fertiliser needs by importing urea. Zimbabwe will have to import 195 131 tonnes of urea to replace 110 244 tonnes of ammonia necessary to produce Sable’s annual capacity of 240 000 tonnes of ammonium nitrate – Sable’s second advantage is that it provides its owners and Zimbabwe with the cheapest possible way of doubling Zimbabwe’s nitrogenous fertiliser production capacity. Ideally, Sable’s profits would be of a size to permit Sable to finance expansion of its annual capacity. Realising that ideal depends on the electrolysis plant possessing a long life,” Mr Mutasa was quoted as telling shareholders in December 2013.
Transporting urea into Zimbabwe – a land locked country at the southernmost tip of the second largest continent in the world – is considered as both expensive and costly than importing ammonia into Zimbabwe.
TA believes that it presently needs a viable tariff while it is implementing alternative technology to produce ammonia, the feedstock in the manufacture of ammonium nitrate.
Negotiations with Zesa have not been concluded yet.
TA Holdings Limited recently reported a loss after tax of US$5,7 million after accounting got a us$13,7million impairment loss against its investment in Sable Chemicals Industries Limited.