Thursday, December 06, 2012

(HERALD ZW) Three mining giants to lose licences

Three mining giants to lose licences
Sunday, 02 December 2012 00:00
Kuda Bwititi and Tinashe Farawo

Three major mining companies are set to have their operating licences revoked after blatantly refusing to comply with Zimbabwe's indigenisation regulations. The Ministry of Youth Development, Indigenisation and Empowerment has recommended that the three, Metallon Gold — the largest gold mining company in the country — Vumbachigwe Mines and John Mack Gold Mine face punitive action for ignoring instructions to cede shares to the respective communities they operate in under the Community Share Ownership Scheme.

The companies were also expected to initiate and draw up their respective indigenisation proposals.
In an interview last week, Youth Development, Indigenisation and Empowerment Minister Cde Saviour Kasukuwere said he had already written his Mines and Mining Development counterpart, Dr Obert Mpofu, advising him to revoke their operating licences.



Cde Kasukuwere said his ministry took the decision after the three firms remained stubborn.
A Metallon Gold spokesperson refused to comment on the issue last week, saying the firm will issue a full statement this week.



Vumbachigwe Mines and John Mack Gold Mine officials could not be reached for comment.
"We have always been very worried about Metallon Gold. They are the biggest gold mining company in the country, but do not want to comply," said the Minister.



"We have now written a final warning to the three mining companies, telling them that if they do not comply they will lose their licences."



Cde Kasukuwere said Metallon Gold's negative attitude towards indigenisation was unacceptable.
He said the company refused to budge despite being approached by Government several times.
"We consulted them numerous times, asking them to give us their proposals for compliance.



"We even approached and asked them to contribute to the Mashonaland Central Community Share Ownership Trust. They, however, refused, yet they have the biggest gold mines in the province. Our patience has run out; we will not be deterred in implementing the law when dealing with them."



Minister Kasukuwere said authorities would also "read the Riot Act" to Canadian-owned Vumbachigwe Mine after its proprietors refused to contribute to the Gwanda Community Share Ownership Trust. The Trust was launched by President Mugabe in May this year. Cde Kasukuwere said Government was working to revoke the company's licence following its clear disregard for the law.



"I held a discussion with Minister Mpofu. I proceeded to write him a proposal to revoke the mining licence of Vumbachigwe Mine.



"We have already said there are no sacred cows when it comes to the laws of the land."
The Minister added that he would also meet officials of John Mack, one of the biggest mining firms in the gold-rich town of Kadoma.



Cde Kasukuwere emphasised the need for all foreign companies to comply with indigenisation regulations.



"Those who are no longer interested in doing business in this country must leave. We have already said 'lets share the national cake and some are refusing.'"



National Indigenisation and Economic Empowerment Board director of compliance Advocate Zwelibanzi Lunga said the ministry unearthed irregularities in the shareholding structure of Vumbachigwe Mines.
Advocate Lunga added that investigations were also in progress to determine how the firm was conducting business.



"We understand there was an agreement between the Forbes and Thompson family (the owners of the firm) and Duration Mine.



"We are investigating the nature of this arrangement because we suspect there could have been some irregularities."



In terms of the Indigenisation and Empowerment Act, all foreign companies should cede 51 percent of their shareholding to locals.
The indigenisation and empowerment programme has also seen the setting up of community and employee share ownership Trusts.

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posted by MrK @ 5:41 PM