Mining & Trade News

Persistent power blackouts due to Malawi’s insufficient electricity supply, has compelled government to diversify energy sources from hydro-power to include solar, wind energy, coal fired energy sources and the power interconnection to the Southern African Power Pool (SAPP).

Currently, Malawi generates about 250MW of hydro power while the suppressed demand is 351MW. The unmet electricity need does not account for the majority of Malawians who are not yet connected to the electricity grid.

53 per cent of Malawi’s population live below the poverty line and just 10 percent of the country is connected to the national grid with heavy load shedding schedules.

Intermittent power supply has significantly reduced the country’s industrial production rate.

According to Saidi Banda, spokesperson for the Ministry of Energy, several companies are set to start complimenting the hydro power supply by producing and supplying solar energy across the country.

“JCM is currently planting equipment in Salima and will serve the country with almost 70 megawatts of solar energy,” says Banda adding that another company is setting up operations in Nkhotakota while others who have also signed power purchase agreements with government will be rolling out in other areas soon.

Meanwhile, EGENCO, a body assigned to be producing electricity in the country, has recently switched on solar energy to power Likoma and Chizumulu Islands on Lake Malawi.

According to the 2019 World Bank report, Malawi has abundant untapped solar potential, with an average of 3,000 hours of sunshine per year.

Government has confirmed that criminal locomotives attacks have contributed to low usage of the Nacala Corridor, a railway line that transfers goods between Malawi and Mozambique’s Indian Ocean Nacala Port opening access to regional and international markets.

Andrew Nthiko, spokesperson for Ministry of Transport and Public Works admits that despite rail transport being cheap and the Nacala Corridor being revamped, traders prefer using the Beira Port that has no rail route to import goods into Malawi.

The spokesperson says government has devised strategies to ensure safe and secure movements of people and goods on the Nacala rail route.

“We have introduced a toll-free line – 1718 – where any type of vandalism and theft can be reported to relevant authorizes,” Nthiko said.

He adds that government and the Central East Africa Railway (CEAR) has also identified hotspots of theft along the rail and placed cameras for easy tracing.

In a bid to facilitate continued use of the Beira Port, Nthiko says that the Malawi and Mozambique governments have agreed to extend the Limbe-Makhanga-Mutara railway line to the Sena line.

 “CFM of Mozambique has already secured funds to construct their 45 Kilometer line from Mutara. On the other hand, we have tendered for rehabilitation works for reconstruction of line from Marka to Bangula,” he says.

Nthiko further says that with the rehabilitation of the Nacala Corridor, government is optimistic that importers and exporters will start prioritizing rail transport when transferring goods.

“We hope to see people change their attitudes towards this mode of transport,” he explains.

Malawi is a landlocked country. As such, improving regional transport network is a necessary condition for both the country’s competitiveness as well as for improved regional and global economic integration.

Small and Medium Enterprise Development Institute (SMEDI) has advised young entrepreneurs to venture into business partnerships as one way of dealing with challenges facing their businesses.

Speaking during 265 Pitch event in Lilongwe, CEO for SMEDI Rodrick Chattaika said young entrepreneurs in the country are facing challenges including lack of financial support and technical skills, which can be addressed through partnerships.

Chattaika said: “We want to encourage the entrepreneurs to rely on partnerships because one might have feasible ideas and another one resources. If these two merge, they can improve their image amongst themselves and therefore excel in their businesses.”

He said on its part, from the year 2018 to 2020 SMEDI has been working in partnerships with other stakeholders including National Bank, NBS Bank, Malawi Enterprise Development Fund, Synergy and other development banks.

Chattaika said through the partnerships, SMEDI is able to access services that entrepreneurs are lacking as well as giving the banks an opportunity of meeting upcoming business gurus.

SMEDI supported 265 Pitch event as one of its programs that gives courage to young entrepreneurs to showcase their ideas, and gain support from financial institutions.

Chattaika said the event also helps instill entrepreneurship spirit in people who get motivated by fellow entrepreneurs.

“As you know many youths in the country, even if they have the potential to innovate, are the ones who are highly affected in terms unemployment. So if we can harness their skills we can create more entrepreneurs in the country who will substantially contribute to country’s economy,” he said.

In her remarks, Deputy Minister of Labour Vera Kantukule concurred with SMEDI on the issue saying for someone to succeed in business, a partner is required.

Kantukule said: “We have people who are good at marketing while others at production. They have to come together to create a successful business entity.”

“If you look at western culture, a lot of enterprises are working as partnerships and are exceling on the market.”

She, however, said she is impressed with the growing number of young entrepreneurs in the country saying the development will help to reduce the unemployment rate which is growing at an alarming rate.

In the October 2020 265 Pitch, Mtengo Wakumunda company specialized in production of porridge flour emerged as the winner, seconded by Adamant Furniture with Adas Season Farms coming on the third position.

SMEDI is a parastatal under the Ministry of Trade, and was established in 2013 with three departments of business information and training; planning and research; and finance and administration.

Malawi’s rail operator Central East African Railways (CEAR) says it is making substantial progress in the the rehabilitation exercise for the Limbe-Makhanga railway line that was damaged by devastating floods in 2015.

CEAR Spokesperson Chisomo Mwamadi said in an interview that contractors who are working on re-installing the railways have completed 50% of the works.

Mwamadi explained that Limbe-Luchenza stretch of the railway is expected to be finished by April 2021.

He said CEAR has planned to rehabilitate a 72 km rail stretch from Limbe to Sandama while the rest of the line will be rehabilitated by the government.

Mwamadi said the Limbe-Luchenza rail rehabilitation exercise was divided into two phases with Phase 1 covering Limbe to Nansadi segment now 75% completed and Phase 2 covering the Nansadi-Luchenza stretch which is at 50%.

The works underway involve placing of ballast, replacing of bridge wooden sleepers, temping and bridge works at Nansadi.

Other works will include earthworks, installation of rails and track assembly.

Mwamadi, however, bemoans the impact of the coronavirus (Covid-19) pandemic saying it resulted in a five-month suspension of the works which has weighed in on the scheduled completion period.

He, nonetheless, said that CEAR has put in place strategies to speed up the rehabilitation exercise which will open up business in areas along the railway, which is a cheaper mode of transport compared to road transport currently widely used in Malawi.

Malawi’s President Lazarus Chakwera says his administration is committed to resuscitate the tourism sector currently on death bed due to the impact of the novel coronavirus (Covid-19) pandemic.

Chakwera said this when he officially  launched the Sogecoa Golden Peacock Hotel in Blantyre which has over 160 rooms, two restaurants, a shopping mall, a casino and conference rooms.

Sogecoa has invested an estimated K44 billion in the facility which covers an area of 1.6 hectares, with a total floor area of 22,000 square meters.

Chakwera said his administration will endeavor as much as possible to create an enabling environment for the tourism sector which has a strategic role to play in poverty eradication.

He said: “The facility will help in promoting local tourism industry, which is a critical driver of economy in the new Malawi which is currently taking its course.”

“My administration is fully committed in revamping the sector as it is resurrecting from shocks of Covid-19 pandemic, through fiscal stimulus packages.”

He explained that his administration will administer investment incentives packages that are comprehensive and accessible to both local and foreign investors to facilitate growth of the industry.

“We cannot run away from the fact that this sector caters for others such as Agriculture, Technology and Finance hence it is vital that we take good care of it for our own economic recovery and advancements,” he said.

He advised the Ministry of Tourism to conduct feasibility studies that will see development of new tourist cities in Mangochi, Salima, Karonga and Nkhatabay.

Minister of Tourism and Culture Michael Usi described the sector as an integral pillar for Malawi’s development as it offers 6.3% employment opportunities at present and it also contributes 6.7% to the country’s gross domestic product (GDP)

“Tourism is catalyst to unearth business opportunities for other sectors such as Agriculture. However due to the Covid-19 pandemic, a lot of jobs have been lost but as the pandemic situation is improving, the sector will also be revived”.

MD for the hotel group Mike Xhang said the launch of the facility is a milestone to local tourism business and job creation as over 1 thousand jobs were secured during construction works alone.

“We are in the process of developing Africa’s tourism sector, and this is one of the finest hotels in Malawi. This is the 16th hotel we have so far built in Africa with some in Madagascar, Mozambique and Zambia.”

Xhang said as Sogecoa they are committed to come up with creative and innovative solutions for developing economies.

Deputy Ambassador of Peoples Republic of China to Malawi Wang Shung Shen lauded the investment describing it as one of the major projects that Chinese investors have executed in Malawi in the recent years.

Shen said China is determined to do more in developing the Malawi economy owing to the mutual relationship existing between the two countries.

“As we are yearning for better bilateral trade, I believe more Chinese investors will come to Malawi to explore various sectors such as Agriculture and Technology to invest in.”

Renewable Energy Industries Association of Malawi (REIAMA) has advised the Electricity Supply Corporation of Malawi (ESCOM) to avoid the use of untreated poles for high voltage transmission lines.

REIAMA President Andrew Nkoloma said in a Press Release that his association has observed that some poles used under Rural Electrification projects are not to the acceptable standard to carry high voltage power lines as they are not well treated and strong enough to carry high voltage (HV) lines.

Nkoloma cited an incident that happened in Chiradzulu at Malele village, T/A Kadwere where a fallen pole carrying 11kV lines to Nsoni area was spotted with lines almost blocking the road.  He said a closer look at the pole revealed that it was eaten up by termites all inside but, apparently, the line is less than five years old.

“REIAMA has found this hazardous to the general public and immediate attention needs to be taken by ESCOM and any relevant authority,” he said.

Nkoloma urged players in the industry to urgently address the issue of substandard and not well treated poles, which was also raised by Minister of Energy Newton Kambala when he visited RAIPLY Limited.

He said: “REIAMA suggests that inspectors from Malawi Bureau of Standards and Malawi Energy Regulatory Authority (MERA) visit timber processing plants and certify the wood treatment processes for HV poles. Existing power lines must be inspected and certified fit to continue carrying HV lines.”

 “Any sub-standard and not properly treated poles in use must be replaced, every production batch of locally treated poles must be inspected and certified, and finally a toll-free phone number must be made available to the general public for reporting any such faults.”

Renewable Energy Industries Association of Malawi (REIAMA) is a membership association of players in Renewable Energy Industry in Malawi. One of their mandate is to provide a conducive environment for businesses and all players plying their trade in the technologies while at the same time protecting the consumer and general public.

Malawi’s Electricity Generation Company (EGENCO) says 95% of the 18MW Tedzani IV Hydropower Station is ready with all the civil works completed.

The Company says in a press statement that it has commenced electrical-mechanical works following the arrival of various parts and spares required for the project.

Egenco says it has expedited the works despite delays due to the coronavirus disease (Covid19) pandemic that resulted in works being suspended for 3 months, from March to May 2020.

Meanwhile, works have since resumed and it is expected that they will be completed ahead of time in February 2021, beating the official commissioning date of September 2021.

The Power Station is being built with a US$52 million Grant Assistance from the Japanese Government through the Japanese International Cooperation Agency (JICA) with EGENCO contributing US$4.8million.

Tedzani Power Station has a total generation capacity of 102MW comprising Tedzani I and II with 40 MW and Tedzani III with 62MW.

The addition of the 18MW Tedzani IV will increase its capacity to 120MW.

In a quest to mitigate power outages in the country, the company is also constructing 1.3MW Solar Power Plant that will see the livelihood of the people of Likoma and Chizumulu islands greatly improving with a 24-hour availability of electricity.

The solar power plant is part of a 3.1 MW Hybrid Power Plant comprising of 1.8 MW diesel generators and 1.3 MW solar power that was launched in December 2019 by EGENCO with the initial commissioning of only the diesel generators while the commissioning of the solar power plant is expected this year.

The solar power plant is being financed by EGENCO to the tune of K3.2 billion.

Malawi’s Ministry of Mining has dismissed claims on social media that there is occurrence of natural crude oil (petroleum) in Limbe, Blantyre.

A video went viral on the social media alluding to the occurrence of natural crude oil in the area that lies approximately 90 metres to the West of Limbe River and about 170 metres to the East of Limbe Free Market.

This prompted the Ministry of Mining through its Departments of Geological Survey and Mines to send a technical team of experts to the site on a fact finding mission.

Principal Secretary in the Ministry Dr. Joseph Mkandawire said the study revealed that the substance was a refined petroleum product, specifically, diesel.

Mkandawire explained the area is underlain by basement metamorphic rocks assigned to charnockitic granulites which are overlain by younger unconsolidated sediments.

He said; “The unconsolidated sediments were observed on site. To understand the sediments, pitting and augering was done. Water and soil samples were collected and analysed by the Malawi Bureau of Standards (MBS).”

“The pit profile and physiography indicated a gentle slope towards Limbe river; two soil horizons one rich in humus (top soil layer) and the other high in iron content (sub-soil layer). Oil contamination was more visible on the top soil layer and diminishing with depth. If oil had a natural source and pathway, the contamination would be increasing with depth.”

He, therefore, said the results from the standard sample analytical tests such as Distillation, Density, Flash Point, Pour Point, Grease and Oil; conducted in accordance with Standard Test Methods from MBS clearly indicated that the sample fluid collected from the hole at the alleged site was processed diesel and not natural crude oil. 

“The results provide sufficient evidence that some form of anthropogenic disposal of diesel took place in the area and members of the general public are therefore advised to desist from using an analysed spillage to avoid accidents.”

Blantyre City Council reportedly relocated vendors to the area for vending purposes. Land preparation for construction of the vending structures unearthed the alleged oil occurrence.