What is the government motive for squeezing Zimplats for more claims?

Mugabe’s critics and opposition officials have charged that the funds were used to fund his ZANU-PF’s party’s violent campaign to recover lost ground in a run-off election won by the veteran leader but widely disputed by the international community after Tsvangirai pulled out of the contest, citing violence which killed over 200 opposition supporters.

The Bokai platinum project, handed to the state-owned Zimbabwe Mining Development Corporation (ZMDC), initially saw CAMEC take out a 60 percent share, with the ZMDC keeping the remainder.

By 2009, the majority shareholding had shifted to the then London-listed Kazakh firm Eurasian Natural Resources Corporation (ENRC), which immediately announced plans to build a world-class platinum mine on the Bokai concession, producing an initial 120 000 ounces of platinum group metals annually, which would rise to 400 000 ounces.

At the time, ENRC officials, who described the Bokai project as “one of the best in the industry” said they would develop the project “as soon as possible.” Seven years on, the project remains a development prospect.

ENRC has since gone private, changing its name to Eurasian Resources Group (ERG).

It took longer for government to find a taker for the ground released by Zimplats on the Hartley Complex, with a Russo-Zimbabwe joint venture only being announced in September 2014 at an event officiated by Mugabe and Russian foreign affairs minister Sergey Lavrov.

The Great Dyke Investments project in Darwendale, a joint venture between Zimbabwe’s Pen East Investments and OJSC Afromet, a Russian consortium comprising Vi Holding, Rostec and financier Vnesheconombank, plans to mine its 45 million resource at a projected rate of 600 000 ounces per year. So far, more than $50 million has been invested in the project’s exploration activities.

While government might, once again, cash in after hawking the mineral claims to an intrepid punter, its disregard for agreements with country’s biggest ever investment will provide scant comfort to existing and prospective investors already spooked by the administration’s buccaneering tactics.

The Zimplats case, currently before the Administrative Court, raises questions of government sincerity in upholding investment agreements.

Government filed its papers on June 28, with Zimplats submitting opposing papers on July 6 and the case is yet to be heard.

The company contends that, under the 2006 release of ground agreement, “it was accepted by both the government and Zimplats that the ground that Zimplats remained with was required by Zimplats to achieve its expansion objectives”.

Continued next page

(171 VIEWS)