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Zimbabwe's government plans to issue treasury bills to creditors of Hwange Colliery Company and reschedule some of its $160 million of debt as part of efforts to return the coal miner to profitability, the minister of mines said on Friday.

Hwange, in which Zimbabwe's government is the biggest shareholder with a 37 percent stake, is the nation's second-largest coal producer and supplies coke to Zimbabwe Power Company.

The coal miner has been making losses for more than a decade and owes millions to tax authorities, employees and the workers' pension fund.

Mines Minister Walter Chidhakwa said in a statement that Hwange had also laid off nearly half of its junior and middle managers, which would save $3.3 million in salaries every year.

"Negotiations with creditors will continue with a view to enter into payment plans consisting of treasury bills-backed payment plans and rescheduled payment plans," Chidhakwa said.

Hwange is producing between 100,000 to 150,000 tons of coal a month, below a target of 200,000 tons.

Chidhakwa appointed a new board, led by Winston Chitando, who takes on the role in addition to his position as executive chairman of the Mimosa mine jointly owned by Impala Platinum and Aquarius Platinum.

(Reporting by MacDonald Dzirutwe; Editing by David Goodman)

 

Source: Reuter

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