China's Tsingshan to invest $800 mln in its Zimbabwe steel plant

MVUMA, Zimbabwe, Aug 15 (Reuters) - Chinese nickel producer Tsingshan Holding Group plans to invest $800 million in its steel plant in central Zimbabwe through its unit Dinson Iron and Steel Company, a top company official said at a media tour on Friday.

Tsingshan, one of the world's leading nickel producers, has already made significant investments in Zimbabwe. Apart from the steel plant, Tsingshan also has ferrochrome, coking coal and lithium mining businesses in the Southern African country.

Project director Wilfred Motsi said on Friday the funds would be allocated towards a blast furnace and supporting infrastructure to lift capacity from the current 600,000 metric tons of carbon steel annually to 1.2 million metric tons.

But Motsi said the company would first assess whether market demand for carbon steel can absorb a sharp increase in output, adding that the funds would be used to build centering, rolling and steel plants and a blast furnace.

“We are ready for the next stage, but we will look closely at market conditions before committing. We need to be sure the market can take that much product,” said Motsi.

The first phase included a 50-megawatt thermal power plant to reduce reliance on Zimbabwe’s strained electricity grid. The plant will also generate additional power from furnace gas to cover about 20% of its needs, management said.

Zimbabwe’s Information Minister, Jenfan Muswere, said the plant would help reduce the country’s steel import bill, which he estimated at $1 billion annually.