Project Name Zimbabwe-Shagelok Chemicals (Pvt.) Limited

Region Sub-Saharan Africa

Sector Sodium Silicate Production

Project No 007129

Projected Approval Date January 22, 1995

Company Name Shagelok Chemicals (Pvt.) Ltd.

Technical Partner and/or Major Shareholders:   The project sponsors include: three Zimbabwean businessmen, Messrs. Mhlanga, Sibanda, and Masola, who would contribute 28% of the project’s equity, Foksor SA Ltd., a major phosphate manufacturer who would provide 18% of the equity, and VCCZ and ZDB, institutional investors who would provide a combined 37% of the project’s equity requirements.  Messrs. Mhlanga, Sibanda, and Masola would assume top management positions in the company.

Project Cost Including proposed IFC Investment:

Project Cost: US$2.271 million equivalent

IFC Investment: US$0.845 million (US$0.680 loan and US$0.165 equity)

Location of Project and Description of Site: The project will be located in the Mambo Industrial area on the outskirts of Gweru. Gweru is located in the Midlands province of Zimbabwe, 276km from Harare.

Description of Company and Purpose of Project: The project entails the purchase of equipment for the manufacture of sodium silicate for use in the production of textile, detergent, oil, steel and chemical, paper and adhesive products, making Shagelok the second and largest sodium silicate plant in Zimbabwe. The intended production of 40 tons a day will also make Shagelok the second largest sodium silicate producer in Southern Africa, second only to the SCI plant in Durban, South Africa. Shagelok is being set up to produce raw sodium silicate and will not make any liquid silicates. The company''s product is targeted at the Zimbabwean and Southern African markets.

KTG Systems Inc. USA (KTG) will design the furnace equipment, supply, install and commission the plant. KTG has agreed to provide capacity and raw material utilization guarantees.

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Environmental Category and Issues: This is an environmental review category ''B'' project.  Environmental and occupational health and safety issues include furnace emissions, dust emissions, employee protection against dust and noise and general plant safety issues. The sponsors have agreed to comply with all applicable World Bank and Government of Zimbabwe requirements. In order to address the issues listed above, the key features of the company’s mitigation plan entail installation of the following; electrostatic precipitators, covered conveyors, silos enclosed with de-dusters and provision of personal protection equipment.

The ERS is expected to be available on or about January 9, 1996.

Date SPI sent to PIC: December 8, 1995

For additional information contact: Corporate Relations Unit - Telephone (202) 473-7711 Facsimile: (202) 676-0365.



Environmental documents for this project are available at http://www.ifc.org and from the World Bank InfoShop (http://www.worldbank.org/html/pic/aboutinfo.html).