Tuesday, August 20, 2013

(NEWZIMBABWE) Ethanol firm agrees govt joint venture
27/07/2013 00:00:00
by Business Reporter

COMMENT - I guess flapping your arms around like a 'madam' wasn't enough. - MrK

GREEN Fuel has reached a 49-51 percent joint venture with the government, paving way for production to resume at the company’s US$600 million Chisumbanje ethanol plant.

“Green Fuel Private Limited would like to announce that it has resumed the production of anhydrous ethanol for the purpose of blending with unleaded petrol with immediate effect,” the company said in a statement at the weekend.

“The company agreed with the Government of Zimbabwe to form a joint venture adhering to Zimbabwe’s indigenisation and economic empowerment laws 51/49 percent and Statutory Instrument 17 of 2013 considering the commercial realities of the project.

“Consequently this full compliance to the country’s laws would invoke the complementary efforts of the Government of Zimbabwe to sustain the opening of the ethanol plant.”

Production stopped at the company’s Chisumbanje plant after the firm failed to win government approval for mandatory ethanol blending in the country, leaving the jobs of some 4,500 workers at risk.

The government had also expressed concern over various other issues including the displacement of villagers to make way for the company’s sugar cane plantations as well as the company’s shareholding structure.

Although project promoters insisted that the company – a joint venture between two private firms and agro-parastatal ARDA - was locally-owned, the government insisted it must comply with the country’s indigenisation laws.

Under the legislation, foreign companies must transfer at least 51 percent of their local operations to Zimbabweans.

The joint venture agreement is expected to see the government endorse mandatory petrol blending with Green Fuel insisting this can help reduce the country’s annual fuel import bill by up to US$120 million.

“The blending of ethanol with petrol will reduce the petrol price thereby inhibiting the inflation rate in Zimbabwe to the benefit of the general public. It will also ease Zimbabwe’s cash liquidity crisis,” the company said.

Green Fuel also says it has the capacity to meet about 85 percent of the SADC region’s petroleum requirements.

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