Source: Old Mutual nears funding Muzarabani solar project: Cottco -Newsday Zimbabwe
THE Cotton Company of Zimbabwe (Cottco) has revealed that Old Mutual may invest in its proposed Muzarabani solar project that will address power cuts experienced at the firm’s ginnery plant, NewsDay Business understands.
In February, Cottco announced it was negotiating with its partners to establish an energy plant in Muzarabani to address power cuts at its ginnery plant, a factory that separates lint from the cotton seed.
Apart from the Muzarabani ginnery plant, Cottco has five others located in Chinhoyi, Chiredzi, Gokwe, Kadoma and Sanyati.
Failure to secure a steady energy supply at the plant has contributed to the gradual downfall of cotton lint exports that once peaked at US$237 million in 2004, but have since come down to US$46 million as of 2022.
Cottco was expected to have launched the solar plant later this year, which has since stalled owing to a lack of securing an investor.
In an interview, Cottco chief executive officer Rockie Mutenha told NewsDay Business that Old Mutual representatives had toured the site of the proposed solar project to show their seriousness.
Old Mutual has in the past expressed interest in diverting some of its huge investments into bankable renewable energy projects.
“We have approached a number of companies that are willing to assist us, and we are working right now with Old Mutual, who themselves have even gone to Muzarabani to have a look at the site,” Mutenha said.
“They were very pleased with the site, and they are probably concluding the funding part of it so that we start looking at installation of the Muzarabani project.
“But they will let us know when they finish with their financiers because they are also getting money from somewhere else to fund the project for us.”
He said the lack of funding for the project was one of Cottco’s major challenges in getting the project up and running.
“They (interested investors) haven’t gone there, but we have approached them, we had discussions with them, and they were showing interest,” Mutenha said.
“But, when people come and hear our story, probably it’s the funding side on their side, which may be a problem.
“Otherwise, those organisations, the three or four that we have been talking to, were quite keen to assist us with that project in Muzarabani.”
He said negotiations were still ongoing with other financial and technical partners.
In addition to the Muzarabani solar project, the Cottco boss revealed negotiations were still ongoing to purchase the 60 metric tonne oil expression plant from China set to be installed in Gokwe.
Mutenha said a deposit had already been made to the Chinese firm for the plant.
Last year, Cottco announced that it committed just over US$1,5 million for the purchase of the oil expression plant.
Mutenha said this was part of the firm’s plans to add value to their products, allowing them to pay farmers more timeously, thereby motivating them to increase their cotton output.
“The project in Gokwe is still on course. We have already paid a deposit for the oil exploration plant in China, and we want to think that in this coming year, probably around June, we will have installed the plant in Gokwe,” he said.
He said the firm had advised its parent company, the Mutapa Investment Fund, about the challenges they were facing, especially on the arrears that date back to the 2022/23 season, in which farmers are still owed US$5 million.
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