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'Zimbabwe mining rights belongs to Mugabe,' says Mutambara

by Staff reporter
20 May 2013 at 10:04hrs | Views
MINING rights in Zimbabwe are vested in the President and acquisition of a mining title does not transfer ownership of mineral claims to the investor, Deputy Prime Minister Arthur Mutambara has said.

Prof Mutambara was speaking in Nyanga last week during the 74th Annual General Meeting of the Chamber of Mines of Zimbabwe, at Troutbeck Resort under the theme "Where to from here: Managing Developing the Mineral Wealth of Zimbabwe for Tomorrow".

"A (mining licence board) stamp will not give you ownership of our assets in Zimbabwe," he said. "You have to pay the value of the assets. The right to mine must (also) be linked to the value of the unmined asset."

Prof Mutambara was responding to a comment made by Mines Parliamentary Portfolio Committee chairperson Mr Edward Chindori-Chininga on why Government had for a long time haggled with mining companies, such as Zimplats, over the release of excess claims without Government paying, yet it could simply enact legislation that provided for this.

Zimplats recently took Government to court to contest its plans to acquire more than 27 809 hectares of land containing platinum reserves for purposes of allocating to other interested investors after the State had satisfied itself that the country's biggest platinum miner did not have immediate plans to develop the claims.

Prof Mutambara's comments were also informed by the current debate as to why indigenous investors and State institutions should be made to pay for a 51 percent stake in the foreign companies as required by law yet most of the companies acquired the mining rights without paying anything for the mineral value.

Prof Mutambara said there was no discussion of the mineral value when Zimplats acquired its estimated US$4 billion platinums, but the firm wanted Government to pay for repossessed land and for the 51 percent equity under indigenisation.

His remarks that mineral rights are vested in the State through the President was collaborated by Mines and Mining Development permanent secretary Mr Prince Mupazvirihwo, who also said that obtaining approval to mine did not translate into ownership of mineral claims within the allocated ground.

"Zimplats got US$4 billion assets, invested US$700 million as working capital, of which US$400 million was borrowed from the banks. There was never a discussion on the value of the asset because 'we are blind, deaf and dumb'."

"But when the Government started the conversation on the 51 percent equity and to give back land that you (Zimplats) got for free, you put value to it and you charge (Government) US$150 million because 'we are deaf, dumb and blind," the DPM said.

But the Government had since engaged Zimplats over the issue with a view to reaching a mutually beneficial consensus.

Prof Mutambara said negotiations for the disposal of the Government's stake in Ziscosteel to Essar had also not touched on the value of the iron ore reserves, which conservative estimates put at more than US$20 billion.

Prof Mutambara said ongoing processes to come up with a new mining policy and legislation should provide for payment of the mineral value for an investor to obtain the right to mine in Zimbabwe.

Government, he said, should not repeat the mistakes when it negotiates with investors for millions of unallocated mineral-rich land containing diamonds, tantalite, uranium and platinum, among others.

Zimbabwe has more than 40 mineral occurrences most of them under-explored.

It is also against this background that Prof Mutambara called on the Government to move with speed and mobilise resources required to support exploration for new mineral deposits in Zimbabwe.

He said this was critical as it would give Government leverage when negotiating from a position of knowledge of the value of the unmined asset.

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