Mining ZimbabweLatest Mining News, Policy and Industry Updates

South African Police Minister Bheki Cele says reinforcements will be sent to West Village in Krugersdorp, Gauteng to help fight illegal miners accused of terrorising residents.

On Sunday, Cele, Gauteng Premier David Makhura and senior police officers visited the area for a community imbizo.

Residents claimed that armed gangs of illegal miners were terrorising them.

The community meeting came after a group of models filming a music video were assaulted and raped, allegedly by a gang of illegal miners.

Cele said he had ordered a “full SAPS clean-up in the West Rand”.

“No community must be prisoners of crime and ruthless criminals who act with impunity. Residents have the right to feel safe and to sleep at night. This is why the SAPS must be seen and must be felt, while the sealing off of mines is expedited by those responsible,” he said.

National police commissioner, General Fannie Masemola, vowed to send more officers to the mining area.

“We will respond through action, as the police. We will deploy the highly trained TRT (Tactical Response Team), NIU (National Intervention Unit), Special Task Force, and K9 teams to make sure we flush out all undesirable elements in this area. Whoever comes with fire will be met with fire,” he said.

Masemola asked for the community’s cooperation.

Residents had called for the army to be deployed in the area because they said the police were inadequately resourced and corrupt.

Cele said the request for the deployment of the army would be considered when the need arose.

“This process takes a long time. However, in the meantime, the police response to flush out zama zamas will continue and will be bolstered by reinforcements of these specialised units, who will be deployed while government works on a broader security plan to tackle the whole value chain of illicit mining and its beneficiaries,” he added.

Cele however did not mention the viral video of more than ten men purported to be illegal miners who were stripped naked and assaulted by the community whilst Police looked on.

Source Mining Weekly and additional reporting by Mining Zimbabwe

US company Columbia Gem House has denied accusations from Malawi that it owes more than $300 billion in unpaid taxes on minerals extracted in the country.

In a letter dated July 26, Malawi’s attorney general Thabo Chakaka Nyirenda accused the firm of evading duty on sales of rubies and sapphires mined at its Chimwadzulo Mine in Ntcheu from 2008.

The letter alleges Nyala Mines Limited, which it describes as a Columbia Gem House subsidiary, paid taxes of just $600 against projected $24 billion revenues from their Malawian operation.

The Zimbabwe Republic Police (ZRP) in West Nicholson, Matabeleland South Province is investigating a murder case where a 44-year-old man was allegedly murdered by a 22-year-old man at Base One illegal gold panning site along Umzingwane River.

Rudairo Mapuranga

The news has come shortly after a report that the Police in Bulilimamangwe, Matabeleland South is investigating a case of murder were a 37-year-old artisanal miner was allegedly killed by his younger brother (23) following an argument to share gold proceeds.

According to Police spokesperson Asst Comm Paul Nyathi, the Victim, Okay Shoko was attacked with stones and a spear by Disire Sibanda and two other unidentified suspects.

“ZRP West Nicholson is investigating a case of murder which occurred on 2/08/22 at around 1300 hours at Base One illegal gold panning site along Umzingwane River.

“The Victim, Okay Shoko (44) died after he was attacked with stones and a spear by Disire Sibanda (22) and two other unidentified suspects. The suspects accused the victim of having beaten them sometime in 2021,” Nyathi said.

Reports of violence in the artisanal mining sector has been on a decline following the commencement of operation No to Machete gangs which was introduced by the police in 2019 following series of murders around the small-scale mining communities.

A 2019 report by the Zimbabwe Peace Project stated that At least 105 people were murdered all in a space of three months in Zimbabwe’s violent prone mining areas of Kadoma and other neighbouring districts.

The Police since January this year have arrested 29 887 people under operations no to machete gangs. The operation is meant to restore sanity in the artisanal and small-scale mining (ASM) sector.

Illegal Miners are mostly a target of criminals usually referred to as machete gangs who have been causing havoc in the ASM sector.

According to Police spokesperson Assistant Commissioner Paul Nyathi, the operation is ongoing and Police have covered all the provinces.

Machete-wielding criminals are notorious for pouncing on small-scale and artisanal miners, stealing their gold or gold ore and smuggling processed gold to neighbouring countries like South Africa and Botswana through the country’s porous borders.

The Zimbabwe Miners Federation (ZMF) has called miners to formalize their operations by adhering to the dictates of the law to avoid a situation where work is constantly being disrupted by law enforcement agents.

According to ZMF President Ms Henrietta Rushwaya, the Federation has a zero-tolerance mantra of no to illegal mining.  She said that the organisation’s offices are open for everyone to come and get investment advice.

“As small-scale miners, we are saying it is a crime to mine illegally in the country. And we are saying zero tolerance to illegal mining. We should be seen as being associated with constructive and proper mining, constructive in the sense that our mining should be guided by principles as stated in the Mines and Minerals Act.  People are advised and allowed to come to our ZMF offices to find out how best they can be linked with proper mining houses and how best they get tributes from other registered miners,” Madam Rushwaya said.

Zimbabwe will double the royalty rate it charges mining companies on the platinum group metals (PGMs) they produce to 5% from January 2023 in a bid to increase government revenues.

The country is the world’s third-largest producer of platinum, after South Africa and Russia, hosting major miners Anglo American Platinum, Impala Platinum and Sibanye Stillwater.

Presenting a mid-term budget in parliament on Thursday, Finance Minister Mthuli Ncube announced that government income from the mining industry was low due to what he called “a generous royalty regime on some major minerals”.

While more tax will worry mines already creaking under higher production costs, Ncube says miners are contributing too little tax.

“Despite the significant contribution to output and export receipts, the mining sector contributed about 1.2% of GDP in direct taxes to the Fiscus in 2021. This is a significant contrast to countries in sub-Saharan Africa which averaged 2% during the same period,” Ncube says.

“A royalty rate of 5%, which is in line with other platinum-producing countries in Africa, is proposed effective 1 January 2023,” Ncube said.

Ncube also proposed a 5% royalty rate for lithium, a mineral that is drawing investor interest in Zimbabwe, which holds some of the largest hard-rock lithium deposits in the world, as demand for battery minerals grows.

Mineral exports from Zimbabwe, mainly gold and PGMs, reached US$5 billion in 2021, accounting for 80% of the country’s total export value.

Ncube expects total export earnings to increase 16% to US$7.3 billion this year, buoyed by commodities.

How do Zimbabwe royalties compare?

In 2012, Zimbabwe doubled royalties for platinum miners to 10%. However, operators under a special lease paid only 2.5%. Under pressure from miners who said this brought uncertainty to investment, government then dropped the royalty to a uniform 2.5% in 2017.

South Africa, the world’s leading PGM producer, uses a formula to calculate the royalties it charges mining companies, based on earnings. The royalty rate is capped at 5% for refined minerals and at 7% for unrefined minerals.

In Zambia, producers of copper, the country’s biggest export, pay 5.5% when the price is under US$4,500 per tonne and up to 10% should the prices firm above US$9,000 a tonne. While Zambia is not a major platinum producer, it has set its royalties for precious metals, including platinum, at 6% of the value.

Mining companies in Zambia are allowed to deduct royalties as an expense from their taxes.

In Tanzania, platinum miners pay a 6% royalty.

NewZWire

The Zimbabwe Republic Police (ZRP) Bulilimamangwe, Matabeleland South is investigating a case of murder where a 37-year-old artisanal miner was allegedly killed by his younger brother (23) following an argument to share gold proceeds.

Rudairo Mapuranga

According to ZRP, the Victim Khaliphile Ndlovu died after he was hit with stones on the head by his brother Coster Ndlovu together with Coster’s 24-year-old friend Jonathan Moyo at Gossan Mine in Mphoengs.

“Police in Mphoengs are investigating a case of murder which occurred on 31/07/22 at Gossan Mine.

“The victim, Khaliphile Ndlovu (37) died after he was hit with stones on the head by his brother Coster Ndlovu (23) as well as his friend Jonathan Moyo (24) following an argument over sharing of gold proceeds,” the police said.

Reports of violence in the artisanal mining sector have been on a decline following the commencement of operation “No to Machete gangs” which was introduced by the police in 2019 following a series of murders around the small-scale mining community.

A 2019 report by the Zimbabwe Peace Project stated that at least 105 people were murdered all in a space of three months in Zimbabwe’s violence-prone mining areas of Kadoma and other neighbouring districts.

Zimbabwe’s widespread and lucrative artisanal mining which back then was controlled by machete-wielding criminals was a death sentence to many with mobs often caught up in machete wars that often turned fatal. Ordinary citizens were also caught in the crossfire or in some instances, they were direct targets of the gangs.

The Police since January this year have arrested 29887 people under operations no to machete gangs, the operation is meant to restore sanity in the artisanal and small-scale mining (ASM) sector.

Illegal Miners are mostly a target of machete gangs who have been causing havoc in the ASM sector.

According to Police spokesperson Asst-Comm Paul Nyathi, the operation is ongoing and they have covered all the provinces.

Machete-wielding criminals are notorious for pounding on small-scale and artisanal miners stealing their gold or gold ore and smuggling processed gold to neighbouring countries like South Africa and Botswana through the country’s porous borders.

The police restored order in mining areas after taking the machete gangs head-on, arresting large numbers of people and thwarting a wave of violence that threatened to disturb gold mining and consequently deliveries to Fidelity Gold Refinery (FGR).

The Zimbabwe Miners Federation (ZMF) has called on miners to formalize their operations by adhering to the dictates of the law to avoid a situation where work is constantly being disrupted by law enforcement agents.

Under its quest to see the Artisanal and Small Scale (ASM) sector contributing an annual revenue of US$4 billion to the US$12 Billion 2023 mining vision.

According to ZMF President Ms Henrietta Rushwaya, the Federation has a zero-tolerance mantra of no to illegal mining.  She said that the organisation’s offices are open for everyone to come and get investment advice.

“As small-scale miners, we are saying it is a crime to mine illegally in the country. And we are saying zero tolerance to illegal mining. We should be seen as being associated with constructive and proper mining, constructive in the sense that our mining should be guided by principles as stated in the mines and minerals act.  People are advised and allowed to come to our ZMF offices to find out how best they can be linked with proper mining houses and how best they get tributes from other registered miners,” Madam Rushwaya said.

The world’s biggest miners have spent the past two weeks reporting lower profits, shrinking dividends and a worsening outlook as the year rolls on.

While commodities like iron-ore and copper have retreated as gloom settles over the global economy, Glencore is enjoying two key advantages over its mining rivals – a powerful trading business that thrives in volatile markets, and a suite of coal mines now churning out previously unimaginable earnings thanks to the global energy crunch.

As a result, analysts are forecasting record profits and returns when Glencore reports on Thursday, with first-half earnings seen more than doubling from a year ago.

It’s a sharp reversal from previous years. The company had lagged its biggest rivals, largely because it doesn’t mine any iron ore, a commodity that helped supercharge earnings for mega miners BHP Group and Rio Tinto Group. But China’s Covid controls have sapped demand for the steelmaking ingredient as investor worries about a global recession weigh on commodity prices more broadly.

Rio Tinto last week reported a sharp decline in first-half profit and cut its dividend in half, while Anglo American announced lower earnings and shareholder returns. Other miners from Vale to Lundin Mining also disappointed.

For now, the companies are still making good money, if not at last year’s record levels. It was Anglo’s second-best first half on record, while Rio paid its second-biggest interim dividend. But the increasingly uncertain outlook and weakening prices have cast a shadow over the underlying numbers, particularly as relentlessly rising costs across the industry add to profit-margin pressures.

“Prices have sharply declined from first-half averages, so these reported results do not reflect the reality of the markets today,” said Christopher LaFemina, an analyst at Jefferies Group. “We are in a stage of the cycle during which prices are falling and costs are still rising. Not a good combination.”

Against this backdrop, Glencore is expected to deliver its best-ever results. The company has already said that its trading profit will exceed the top end of its guidance range, after it cashed in on volatile markets.

But it’s coal — the dirtiest fuel — that is seen as the really big earner.

Prices have soared to records this year as a global energy crisis boosts demand for fossil fuels around the world. Utilities are curbing imports from Russia due to the war in Ukraine, tightening the amount of available supply, while surging natural gas prices are also increasing demand for coal.

That’s put Glencore in a position to return cash to shareholders on a scale that was previously the reserve of the iron-ore majors, with some analysts forecasting payouts could exceed $10-billion in total this year.

The current dividend policy is to pay $1-billion from its trading unit, plus 25% of free cash flows from the sprawling mining business.

Still, some of those expectations — at least for the half year — have been tempered after Glencore flagged that its profitable bets on volatile commodity markets have tied up more working capital than normal.

“The underlying result will be very strong, and when markets return to lower volatility this working capital will be released making it a temporary impact,” said Tyler Broda, an analyst at RBC Capital Markets. “For now, however, this could temper the cash returns expected at the half-year results.”

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