Mining ZimbabweLatest Mining News, Policy and Industry Updates

A TOTAL of 52 families in Lubimbi, Binga, Matabeleland North are facing eviction after Hwange Colliery Company got a grant to extract coal from the area.

The community was already facing eviction to pave way for the construction of the Gwayi-Shangani Dam.

Lubimbi ward councillor, Chrispen Munkuli confirmed the developments.

“As a community, we have discussed the issue and agreed that we will not agree to the evacuation.  However, we are advised that he mining company is now ready to mine.”

Munkuli said they were waiting for the district development co-ordinator (DDC) to address the villagers on the issue.

DDC Land Kabome said he was aware of the issue.

In 1945 the Lubimbi community was moved from the Madilo area between Shangani and Kana rivers to pave way for a Cold Storage Commission project.

Some were moved to the area during the construction of the Kariba Dam around 1956, and the others came from Sinamatela area around 1950 and were moved to pave way for the establishment of the Hwange National Park.

“It has not yet reached that level of evacuation but l am aware that HCC was given a mining claim long back. The colliery is supposed to go to the community and advise the villagers,” Kabome said.

“We have not yet engaged the community. We will update you, because there will be certain things we expect the HCC to do for the community.”

HCC public relations manager Beauty Mutombe said they were engaging the community.

“There are no evacuations at this stage, we are engaging the community through the office of the DDC but so far we have not yet done anything on site,” she said.

Newsday

ZESA Holdings says the power utility will focus mainly on providing solutions amid a spike in theft and vandalism on its property.

ZESA executive chairman Sydney Gata said the power utility was going to use technology in the fight against theft as the number of incidents has been on the rise, delaying development of key infrastructure as the utility had to channel the money towards replacing the stolen key equipment.

“Solutions to theft and vandalism should be prioritised. In order to mitigate the risk of theft and vandalism, Loss Control is working with other stakeholders and law enforcement agents. Even though this is the case, there is a need to explore technology and ride on such technological interventions to curb with speed the  problem of theft and vandalism,” Gata said at the ZESA Risk Management Awards ceremony held this month.

Equipment theft and vandalism has been identified as one biggest risk prejudicing the power utility of more than US$2m annually.

So widespread is the theft and vandalism that in 2019 the power utility acquired industrial-grade enterprise drones to curb the vice, which has been likened to economic sabotage.

Zesa has also been lobbying for a stiffer, longer sentence for those convicted of infrastructure theft.

There have also been claims that ZESA employees were behind most of the theft cases as economic conditions in the country have worsened rendering salaries useless forcing them into crime.

The Zesa Risk Management awards were held to honour stations with outstanding performance within the ZESA group that excelled in good risk management practices during the year 2021.

ZPC Kariba Power Station and ZENT Projects division were awarded for being the overall best in risk management and loss prevention.

In order to mitigate the risk of fires and explosions, which has also caused severe losses other than theft and vandalism, Zesa reported that it acquired and commissioned Arc Flash personal protective equipment valued at US$350,000.

Business Times

Workers in the mining sector have been awarded between 46% and 50%  wage increase which will see the lowest employee earning ZWL$45 000 from ZWL$30 000 a month following a recent agreement between the Associated Miners Workers Union of Zimbabwe and the Chamber of Mines of Zimbabwe.

The highest paid will now earn about ZWL$104 000 from ZWL$71 000.

According to the National Employment Council (NEC) of Zimbabwe for the mining industry, the workers will  also get a minimum portion of US$198 and US$460 respectively.

“This notice serves to bring to your attention that the following new minimum rates or pay grades 1-13 have been agreed upon in dual currency. This agreement carries an exemption Clause as stipulated in the Principal Agreement Statutory Instrument 152 of 1990 Clause. Non  foreign currency generating companies upon being granted an exemption may be allowed to pay the United States dollar amount in Zimbabwe dollars  equivalent using the official bank rate. Employers who are able to pay more than the NEC minimum are encouraged to do so,” NEC said.

The salary increment comes after the cost of living for a family of six increased  by 25% to $72 967 to meet their basic needs according to the Consumer Council of Zimbabwe (CCZ).

The current cost of living implies that a family of six now requires US$300 using the current parallel market exchange rates per month to meet their monthly requirements or US$700 based on the official rate.

Revenue and together with agriculture the sector is expected to anchor economic growth this year.

Business  Times

Caledonia Mining Corporation has entered into a zero cost contract to hedge approximately a quarter of its 2022 gold production target at Blanket as it seeks to protect its balance sheet during its phase of higher capital investments.

The Victoria Stock Exchange-listed miner has entered into a cap and collar hedging contract for 20,000 ounces of gold in the period March to July.

The contract has a cap of US$1,940 and a collar of US$1,825 which means that for 4,000 ounces of gold per month for the period, Caledonia will receive an effective gold price per ounce of not less than US$1,825 or greater than US$1,940. It will receive an effective spot gold price between these two levels.

CEO Steve Curtis said the resources firm decided to hedge production so as to take advantage of the current strong gold prices to protect the balance.

He said hedging gold production is not an easy decision for a gold miner as investors usually wish to maximise exposure to gold price upside.

“However, given the fact that our capital expenditure phasing is heavily weighted towards the first half of 2022 as we ramp up gold production, the board considered it prudent to take advantage of the current strong gold price to protect the balance sheet during this phase of higher capital investment with a five-month hedging arrangement over a portion of our production,” Curtis said.

Hedging is a risk management strategy employed to offset losses in investments by taking an opposite position in a related asset.

The reduction in risk provided by hedging also results in a reduction in potential profits. Hedging strategies typically involve derivatives, such as options and futures contracts.

Meanwhile the company is targeting an annual gold output of 80 000 ounces in 2022 and they are also top acquire more assets in the country.

Business Times

AUSTRALIA Stock Exchange-listed Invictus Energy Limited, has completed data processing of the 2021 seismic survey for the Muzarabani oil and gas project as well as the concurrent reprocessing of a legacy Mobil dataset.

Invictus, which is developing the Cabora Bassa oil and gas project in Muzarabani, Mashonaland Central province, is reprocessing data from an initial seismic survey that was done in the 1990s by Mobil, a France-headquartered company.

Despite undertaking the initial seismic survey in the Cabora Bassa area, Mobil decided not to follow it up and thus Invictus, using more modern data processing techniques, reprocessed the data gathered and found strong evidence that the underlying geological structures had the domes and traps that could indicate oil and gas in Muzarabani.

In oil and gas exploration, seismic survey refers to the process of using high-tech equipment to listen to underground vibrations in order to determine the existence of hydrocarbons.

“Data processing of the 2021 Cabora Bassa 2D Seismic Survey (CB21 survey) and concurrent reprocessing of a legacy Mobil dataset has largely been completed by onshore highresolution data specialists Earth Signal Processing in Calgary, Canada.

“All key products have been received by Invictus and seismic interpretation is progressing well,” it said.

The acquisition and data processing of the CB21 survey, along with the reprocessing of 1990 Mobil survey data has achieved the objectives of providing a high quality, comprehensive 2D data set which is contractor-consistent and process-consistent.

The parameters employed for the acquisition of the CB21 survey, along with modern data processing technology have significantly elevated the data quality to a high standard.

“As the interpretation is progressing, multiple anomalies have been noted in the basin’s seismic data.

“These can often be indicators for the presence of hydrocarbons. Examples of these are provided in the images overpage.

“These anomalies will be investigated with additional data processing products produced by Earth Signal Processing.

“Their geophysical signature, as well as trapping geometry and position (structurally and stratigraphically) will then be evaluated,” said Invictus.

It is hoped that this would allow the anomalies to be assessed and ranked to ascertain the likelihood of viable hydrocarbons within a definable trap.

Invictus managing director Mr Scott Macmillan commented: “The maiden drilling programme to test the world-class Muzarabani prospect is coming together well.

“We are pleased to have secured Exalo’s rig 202 as well as well services with Baker Hughes and long-lead items.

“The final seismic data has provided evidence of multiple trapping geometries and a target rich environment for the upcoming drilling programme.”

The drilling campaign is scheduled to commence in June this year and Invictus is working towards a two-well programme.

“The Company is maturing additional potential within our acreage and continuing to build on our significant prospective resource inventory,” he said.

The Chronicle

Mining companies in Limpopo are not fully complying with laws compelling them to uplift local communities. This is according to a report released yesterday based on research by the Centre for Applied Legal Studies, Amnesty International and Sekhukhune Combined Mining Affected Communities (SMAC).

Shenilla Mohamed, executive director of Amnesty International South Africa, said mine owners had an obligation to the surrounding communities and to “adhere to social plans”.

Mohamed added that the government needs to be held accountable too.

The research was done between October 2020 and July 2021 in the mineral-rich but underresourced Sekhukhune region, which has an unemployment rate of 47 percent.

It focussed on three companies, Twickenham Platinum Mine, Marula Platinum Mine and Sefateng Chrome Mine, and their compliance with legal obligations to submit and implement Social and Labour Plans (SLPs).

Researchers say the obligation on companies to comply and report to the regulator on compliance with SLP’s comes directly from the Mineral and Petroleum Resources Development Act, which makes SLPs a condition for the award and renewal of mining rights.

SLPs must contain a number of measures to benefit communities and workers. They should also include basic services and infrastructure-type projects formulated in consultation with communities.

According to the report, SLPs were introduced to offset the “dark and sordid history” of discrimination, exploitation and exclusion in the mining industry.

The research finds that there were varying levels of non-compliance by the three
companies.

Researchers gave each of the companies an opportunity to respond to the allegations.

The report found that Twickenham, a subsidiary of Anglo American Platinum Limited, failed to complete a project to provide water and toilets to local schools. Anglo American Platinum Limited is the world’s largest primary producer of platinum.

Researchers said that when pressed for answers, the company acknowledged delays in implementation. “They gave no reasons in some cases and in others blamed project procurement irregularities,” the researchers said.

“Marula, another platinum mine, claimed in its most recent Environmental, Social and Governance (ESG) report that it had completed an SLP project to build and rehabilitate a road. But site visits by the research team and interviews with community members contradicted this,” the report read.

Researchers said that the lack of adequate roads has resulted in mobile clinics avoiding affected villages and community members facing great difficulty in accessing clinics and hospitals.

The report found that Sefateng was only partially compliant with its community water support and schools support projects. Information received from the Department of Mineral Resources and Energy (DMRE) indicated that Sefateng was not submitting annual compliance reports.

“This would be in direct contravention of national mining legislation. However, in their response to the research team, Sefateng denied this and noted that they have been complying with this obligation,” the report said.

Researchers highlighted the failure by the department to properly monitor compliance, in part because of the lack of resources.

They said the department had a poor record management system; had hindered access to information; and was unable to enforce compliance “resulting in communities feeling abandoned and unable to enjoy human rights such as the rights to education, access to healthcare, livelihoods and water”.

The researchers said a direct link between mining and the challenges faced by the communities could not be established but that the failure of mines in general to implement SLPs was a “compounding factor”, warranting further investigation.

Community members interviewed for the report also complained of polluted water sources and many suggested that they and their livestock suffered serious health complications.

“The overall picture painted by interviewees was a range of negative environmental, social and economic outcomes, gender inequality and a lack of adequate grievance mechanisms.”

The researchers recommended that the three mines urgently comply with their legally binding obligations.
The report also recommended that the state develop and implement a plan that ensures proper monitoring, with penalties for companies in the event of non-compliance.

“We further recommend that, whether through regulations or legislative measures, that all company SLP reports to the DMRE are publicly disclosed and made available and accessible to employees, communities and other stakeholders.”

The researchers said they had attempted on numerous occasions to engage with the department but had not received responses.

GroundUp also approached the department but did not hear back from officials by the time of publication.
Companies respond to allegations in the report Anglo American Platinum told GroundUp that the Twickenham project was placed on care and maintenance in 2016, limiting employment and business opportunities at the operation.

Currently, three of the 12 projects in its SLP between 2016 and 2020 remain incomplete due to various challenges.
“We take our SLP obligations seriously. Unfortunately, our efforts to meet our SLP obligations are sometimes affected by external factors beyond our control.

These include, but are not limited to, delays at local government and DMRE level, difficulties in our engagements with the communities, community conflict and obstacles arising from the appointment of contractors.”

The company said it had already started work on its SLP for 2021 to 2025. “We continue to study options to ensure a sustainable future for Twickenham that will benefit communities and the broader Limpopo province.”

Implats’ Marula Mine said it had grown community investment. The company said it “engages in sustainable socioeconomic development to mitigate, where it can, adverse conditions”.

It said 7,5 percent of the mine was owned by the local community through a trust and employees also had a stake. The company said 74 percent of its workforce are local residents and “total remuneration at Marula is approximately R1,6-billion annually”.

“While providing and maintaining roads fits within the ambit of the government, we fully recognise the benefits of being able to travel safely to and from work and elsewhere.

“To the extent that this infrastructure is lacking or poorly maintained, we endeavour to assist, where possible.”

The company said it had built a 12.5km tarred road (the D4170) at a cost of over R200 million, in partnership with Road Agency Limpopo over the past five years. Marula contributed R32 million to this project.

The company said it had also paid for maintenance on other roads and the construction of a bridge.

Sefateng’s chief executive Gerard Blaawu said: “It was a privilege for us to have been part of the sample group of mines in this study. There are various administrative shortcomings, communication gaps between national and local bodies, regulators, struggling municipalities as well as financial challenges.” – Moneyweb

He said that of their projects that were reviewed, they were starting to get one complaint.

The other two were partially compliant, with gaps mainly due to administrative processes and/or the municipality finding it hard to upkeep services built on their behalf.

Since the research was finalised, the mine moved from 75 percent to 80 percent compliance.

“We take to heart the recommendations in the report. Regardless of the level of applicability, we are committed to work with the regulator and other parties to implement these recommendations.”- Moneyweb