(DAILY MAIL) Mine law to be revised

COMMENT - Yes, minister Mwale, being allowed to steal from your shareholders must make Zambia an extremely attractive place to invest in. Minister Maxwell Mwale should go to prison for fraud. Mining companies in Zambia also pay an effective tax rate of 0% or less. I guess that makes Zambia 'very attractive'.

Mine law to be revised
From MARTIN KAPENDE in Cape Town

ZAMBIA is to re-enact the 2008 Mines and Minerals Development Act to put it in line with the changing environment and in conformity with stakeholders’ participation. The changes will be in line with consultation with various stakeholders including increasing the upper limits of prospecting areas explorers can hold from 1,000 km2 to 2,000km2 to promote conceptual large-scale exploration.

Minister of Mines and Minerals Development Maxwell Mwale told an African Mining Ministerial Forum here that the revision will see the maximum tenure of a prospecting licence increased from seven to 10 years with an initial period of four years and two subsequent renewals of three years each.

He said this is expected to give companies sufficient time to conduct conclusive prospecting operations over the licence areas and also compensate for the lost time from November to April due to the rainy season, which makes access to exploration areas virtually impossible.

The Ministerial Forum was held at the ‘Investing in Africa Mining Indaba 2011’, which has attracted about 6,000 people from the initially projected 4,500 delegates.

Mr Mwale said the upper limit of an area of large-scale mining a licensee can hold has been increased from 250km2 to 1,500km2 to accommodate large mine development where ore bodies may be scattered over a larger area.

The minister also said Zambia has reviewed the type of licences that can be issued from the current seven to five.

He said the licensing and granting authority will also be vested into one office, that of the director of mining cadastre under the proposed law to be re-enacted to enhance efficiency in the administration of mining rights and align it with international best practices.

He said in reviewing the Act, the government has adopted a give and take approach and cautioned investors that the ministry will use the ‘use or lose it principle’, adding that the exploration law says if a firm does not use the licence then it can lose it.

And Government has abandoned calling for bids for oil and gas exploration, but will allow companies that want to simply procure the data and pay for the blocks while it has also reserved seven blocks for itself.

So far, out of the 23 oil and gas blocks demarcated, government has awarded 11 blocks to local and foreign investors while seven have been reserved for itself.

Meanwhile, the minister said he was not aware that First Quantum Minerals (FQM) had kept in its accounts about US$300 million unpaid dividends to ZCCM-IH, of which it owns itself a 20 percent stake in (FQM).

He was responding to a question from one of the minority shareholders in ZCCM-IH who wanted to know when Government will put its foot down to ensure FQM pays the dividends due to ZCCM-IH.

But the minister said FQM had been one of the companies paying higher taxes to Government and had found the environment in Zambia attractive to invest in.

Mr Mwale urged investors to come to invest in Zambia and outlined the various mining opportunities and minerals available for them.

Zambia has been stable and maintained the corporate tax of 30 percent, three percent mineral royalty of gross value, plus 15 percent withholding tax on interest, dividends, royalties and management fees coupled with 100 percent capital allowance on machinery.