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Crackdown chases away gold producers

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Crackdown chases away gold producers

A crackdown by the police and the Environmental Management Agency (EMA) on illegal gold miners has forced Zim Goldfields, a joint venture between Zimbabwe and Belarus, to end its operations in Penhalonga, in Mutare district, Manicaland Province.

The joint venture was signed in 2018 by the Mines and Mining Development Minister, Winston Chitando and Belarus Chief of Presidential Affairs, Victor Sheiman.

Goldfields had been granted the right to mine gold in the province.

But the recent government ban on riverbed mining and the threat of illegal gold miners, forced the company to stop operations.

The joint venture has been subject to controversy as many questioned government policies with regards to riverbed mining.

“After some time, illegal operations were getting out of hand so our company has written numerous reports to the local and district offices of police, EMA, Ministry of Mines. Police had to come on the ground and hold operations against illegal mining, explaining to the local community about mining rights and their importance. The problem was not solved as the illegal miners were benefiting more,” Zim Goldfields representative Dmitri Krasilnikov told Business Times.

“[Also], due to the ban on riverbed mining our operations had to stop and currently we do not hold any operations in that area, as our company strictly follows all government regulations.”

Krasilnikov hoped the ban “will soon be lifted and we will be able to hold proper operations”.

Zim Goldfields was planning to set up a test plant which has now been shelved.

 

 

 

Tesla, Re|Source to launch final pilot in DRC to trace cobalt from mine to EVs

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Tesla, Re|Source to launch final pilot in DRC to trace cobalt from mine to EVs

Re|Source, a solution to trace responsibly produced cobalt from mine to electric vehicle (EV), is moving forward with a pilot project in the Democratic Republic of the Congo (DRC) jointly developed with EV giant Tesla.

Mining

The program is being tested in real operating conditions at multiple on-site pilots, including the DRC and Europe, Re|Source said, with further pilots in Asia and the US planned to start later this year.

The final pilot across the entire Tesla supply chain is expected to take place in the fourth quarter. The launch of the final industry solution, supported by boutique blockchain technology studio, Kryha, will follow in 2022, it said.

Tesla struck a deal in 2020 with Glencore (LON: GLEN) to buy cobalt from its Congo mines, but it has also been seeking to reduce its reliance on the metal. 

DRC holds around 70% of the world’s reserves of cobalt, crucial for the lithium-ion batteries used in the fast-growing EV sector.

Congo’s artisanal miners are the world’s second-largest source of cobalt after the country’s industrial mines. Consultancy CRU expects the DRC to produce more than 100,000 tonnes of cobalt this year, or 71% of the global total, of which 8,000 will come from artisanal sources.

Child labour and a lack of safety measures in artisanal mining are behind many initiatives to formalize the sector.

According to Amnesty International, children as young as seven have been found scavenging for rocks containing cobalt in the DRC. The group also claims to have evidence that the cobalt those miners dig has been entering the supply chains of some of the world’s biggest brands.

Cleaning up the sector’s image 

Tesla is not alone. Several market actors are involved in similar initiatives in the DRC. Volkswagen , for one, is working on improving working conditions in the cobalt-rich nation. The metal, a by-product of copper or nickel, is an essential metal in the production of the batteries that power EVs and high-tech devices.

Trading house Trafigura inked earlier this year a supply deal with Entreprise Générale du Cobalt (EGC), a DRC-owned company that began operating in March. It was created a year ago to help control artisanal supplies and boost government revenue through price controls.

China’s biggest cobalt producer, Huayou Cobalt, which supplies to LG Chem as well as Volkswagen, said last year it would stop buying from artisanal miners in the DRC.

Official figures show that more than 200,000 people make their living digging cobalt and copper in Congo’s southeast Katanga region.

 

Re|Source’s founding members include Glencore, Eurasian Resources Group (ERG) and China Molybdenum (CMOC)

It counts The Responsible Minerals Initiative and The Cobalt Institute as its strategic advisers.

Re|Source is the latest effort to use blockchain to improve the transparency of global supply chains, especially in commodities.

Blockchain, the technology behind cryptocurrency Bitcoin, creates a link between the physical and the digital worlds, offering a secure digital ledger of transactions that can’t be tampered with.

A few companies have explored of the use of blockchain in the mining industry over the past two years. The world’s no. 1 diamond producer by value, De Beers launched its Tracr platform, which allows tracing gemstones throughout the entire value chain — from mine to buyer.

Automaker Ford partnered in 2019 with IBM, South Korean battery maker LG Chem and Huayou  to trace cobalt on a simulated sourcing scenario.

Act covering mining leases

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Act covering mining leases

Introduction

Mining leases are covered in Part VIII, being sections 135-157 of the Mines and Minerals Act (Chapter 21:05) (or the Act) while special mining leases are covered in Part IX, sections 158-168.

Mining rights of holder of mining lease

In terms of section 150 (1) every holder of a mining lease shall possess the following mining rights:

The exclusive right of mining any ore or deposit of any mineral mentioned in section 135 (2)

(a) which occurs within the vertical limits of the area covered by his or her lease.

It is a requirement in terms of section 135 (2) (a) for an applicant for a mining lease to furnish the mining commissioner particulars of the minerals which are being mined or to be mined in the area applied for.

The exclusive right within the vertical limits of the area covered by his or her mining lease any ore or deposit of any mineral discovered within such area after he or she has notified the mining commissioner.

This excludes the right to mine coal, mineral oil or natural gas.

Section 150 (2) confers the holder of a mining lease which includes any metal blocks in respect of which he gave details under section 135 (2) (c) the right to retain, in respect of such blocks, the extra-lateral rights which he or she held at the date of issue of the lease.

Extra-lateral means the right of following a reef on its dip beyond the vertical limits of the block.

Application for mining lease

According to section 135 (1) the holder of a registered mining location or of contiguous registered mining locations may make written application to the mining commissioner for the issue to him or her of a mining lease in respect of a defined area within which such mining location or locations are situated.

Information requirements are specified in the section.

Consideration of mining lease application

An application for a mining licence is considered by the Mining Affairs Board (MAB or the board) in terms of section 142. The MAB considers the following in determining an application:
Any determination on any objection made by the Administrative Court or the mining commissioner and any objection mentioned in section 139 (3). That the applicant’s financial status is such that he or she will be able to meet any payment due under section 344.

That mining operations on a substantial scale are likely to be conducted for a considerable period within the area applied for.
That no ground not open to prospecting is included in the area to which such approval would relate.

According to section 142 (6) the decision of the MAB to grant or refuse an application for a mining lease shall be final and without appeal.

Issue of mining lease

This is done in terms of section 145. Where the MAB has approved an application for a mining lease, the board shall forthwith issue a mining lease in favour of the applicant in respect of the area approved and in accordance with the terms and conditions fixed by the
MAB itself.

Transfer of mining lease

Section 149 applies. A mining lease may not be transferred except to a person approved by the MAB after consultation with the owner of the ground covered by the lease. The board shall not approve the transfer to any person unless it is satisfied that the person is able to meet any payment which may become due under section 344.

No impeachment to title to mining lease

Section 153 of the Act provides for no impeachment of title to a mining lease on certain grounds.

Special Mining Leases

Special mining leases are covered in Part IX, being sections 158-168 of the Act.

Application for special mining lease

Section 159 applies. Where the holder of one or more contiguous mining locations intends to establish or develop a mine thereon, and:

Investment in the mine will be wholly or mainly in foreign currency and will exceed US$100 million, and the mine’s output is intended principally for export, he or she may apply in writing to the mining commissioner for a special mining lease in respect of a defined area within which his or her mining location or locations are situated.

According to section 159 (2) the MAB may permit a person to make an application for a special mining lease even though (notwithstanding that) either or both the criteria mentioned in section 159 (1)(a)-(b) will not be met, if the MAB considers that it is desirable in the interests of the development of Zimbabwe’s mineral resources to consider the grant of a special mining lease to the applicant. In such a situation the MAB considers:

The nature and size of the mineral deposits within the area over which the applicant seeks a special mining lease, and
The estimated life and economic viability of the proposed mine, and The extent of the investment that will be made in the proposed mine, and The proposed method of extraction, mining and treatment of ore from the proposed mine,
and Any other relevant circumstances.

Issue of a special mining lease

This is done in terms of section 163. The Minister (of Mines) shall forthwith issue a special mining lease if authorised by the President, in accordance with the MAB recommendations or other terms and conditions as the President may direct.

Disclaimer
This simplified article is for general information purposes only and does not constitute the writer’s professional advice. Laws may be subject to frequent changes. To be compliant, organisations and individuals are advised to consult adequately.

Godknows Hofisi, LLB(UNISA), B.Acc(UZ), CA(Z), MBA(EBS,UK) is a legal practitioner/conveyancer with a local law firm, chartered accountant, insolvency practitioner, registered tax accountant, consultant in deal structuring, business management and tax and is an experienced director including as chairperson. He writes in his personal capacity. He can be contacted on +263 772 246 900 or
[email protected].

BlueRock shares jump on biggest diamond found at Kareevlei

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BlueRock shares jump on biggest diamond found at Kareevlei

BlueRock Diamonds (LON: BRD) shares jumped more than 16% on Monday after the miner announced it had found a 58.6-carat diamond at its Kareevlei mine, in Kimberley, South Africa.

The “D” colour makeable stone with some spotted black sulphide intrusions is the largest diamond found to date at Kareevlei.

The discovery comes only a week after Bluerock recovered a 21.6-carat diamond from the same mine.

BLUEROCK EXPECTS THE DIAMOND’S SALE VALUE TO BE “SIGNIFICANT” DUE TO IT BEING A ‘D’ COLOUR “MAKEABLE STONE”

“This is a very important discovery for BlueRock as it supports the ‘size frequency distribution charts’ that indicate our pipes will deliver large high value diamonds,” Houston added.

The executive also noted that the “run of mine” parcel of diamonds recovered this year have secured values of over $400 per carat.

The two diamonds will be sold at the end of the month, BlueRock said.

Shares in BlueRock climbed to £47.22 in early morning London trading on the announcement and were still up 10.6% at £44.8 by 2:30pm GMT, leaving the miner with a market capitalization of £5.72 million (about $7.9m).

The company, which updates the market when it recovers stones valued at over $50,000, fetched $163,000 in January for a 14.8 carat diamond. 

Tycoon may have shifted assets to Zimbabwe after US sanctions

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Tycoon may have shifted assets to Zimbabwe after US sanctions

Zimbabwe’s government is pressing ahead with a plan to combine its mining assets under a massive private-public enterprise, even as evidence mounts that the project could be linked to a tycoon sanctioned by the US and UK.

Previously unreported documents, including correspondence among executives and shareholders, show that weeks after Kudakwashe Tagwirei was sanctioned by the US, his Mauritius-based Sotic International Ltd. began planning to shift its assets to a newly created Zimbabwean holding company — Ziwa Resources Ltd. Ziwa is the only private shareholder in the partnership, called Kuvimba Mining House Ltd.

Zimbabwe government officials have repeatedly denied that Tagwirei has any connection to Kuvimba. But Bloomberg in May reported that Kuvimba holds assets that were until at least late last year part-owned by Tagwirei, citing company documents, emails and transcripts of Whatsapp conversations between executives. The government has as recently as last month declined to say how Kuvimba came to possess the assets, which include choice mineral deposits and mines that it says are worth $2 billion.

Tagwirei, an adviser to Zimbabwe’s President Emmerson Mnangagwa, was sanctioned by the US on Aug. 5 last year on allegations that he used political influence to gain access to scarce foreign currency and win lucrative deals. The US linked him to the disappearance of $3 billion from a farm-subsidy program, and the UK sanctioned him last month for similar reasons.

Under the US sanctions, Tagwirei is effectively cut off from international financial markets. The ruling prohibits US citizens from doing business with him, and his assets in the US are frozen and must be reported to the US Treasury.

Tagwirei didn’t answer calls made to his mobile phone for this story.

Known locally as “Queen Bee,” Tagwirei’s influence over the Zimbabwean economy is so deep that US and UK officials have said payments made to him helped trigger a collapse in Zimbabwe’s currency and contributed to runaway inflation, including drastic increases in the price of food. Zimbabwe last year called the US sanctions racist and intended to undermine the government.

Paying dividends

In June, Finance Minister Mthuli Ncube announced that Kuvimba had paid a dividend of $5.2 million to state agencies, including one charged with compensating White farmers for land seized two decades ago. Two weeks later, on July 6, the government again denied in a statement that Tagwirei was part of Kuvimba. That was in response to an investigative report by The Sentry, a private anti-corruption organization backed by the actor and director George Clooney.

Kuvimba is 65% held by the state and 35% by Ziwa. The private company was registered in Zimbabwe in September with an identical stakeholder structure to Mauritius-based Sotic: Almas Global Opportunity Fund SPC with 65% and Pfimbi Ltd. with 35%. Almas told Bloomberg earlier this year it had decided to exit its Zimbabwean assets. The company didn’t respond to a new request for comment.

Pfimbi’s sole shareholders are Tagwirei and his wife, according to separate documents reviewed by The Sentry. Bloomberg in May reported that Tagwirei controls the company via agreements with nominee shareholders, citing company documents.

‘Negative press’

One month before Ziwa was founded, David Brown, chief executive officer of both Sotic and Kuvimba, wrote Sotic’s shareholders to say that Mauritius was increasingly being seen as a tax haven and that moving the company’s assets to a Zimbabwean subsidiary would encourage “local co-investment” in mines that needed “significant capital investment,” according to documents seen by Bloomberg.

Brown told them restructuring the company was necessary to address “the negative press the company has been subjected to over the past weeks.” He said that Mauritius had been included in the G7 countries’ Financial Action Task Force’s grey list, which forces strict monitoring to combat money laundering, and had also been blacklisted by the European Union.

“Management is proposing to the shareholders that they create a subsidiary in Zimbabwe, and proceed with a restructure of the ownership of the company’s assets such that the Zimbabwean assets are held by a Zimbabwean holding company,” Brown said. This will “give confidence to local Zimbabwean entities who would wish to invest in the mining group,” he said.

Brown said in June that he would be stepping down as CEO of Kuvimba, without giving a departure date.

In conversations with Bloomberg last month, Brown said he’s also a director of Ziwa, but doesn’t know who its shareholders are. He also confirmed that assets held by Mauritius-based Sotic are now part of Kuvimba. He declined to comment further.

Bloomberg

Chrome stage miners protest over $22 per tonne purchase price

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Chrome stage miners protest over $22 per tonne purchase price

Women miners are demanding a fair chrome price from Afrochine agents Ling and Blackie saying the value at which the firms are purchasing their chrome is very low.

Shantel Chisango

Demonstrating at Afrochine Damex Norton Plant last Saturday over unfair chrome prices, chrome miners said Afrochine agents disregard the grade or quality of chrome buying from as little as $22 per tonne.

“All the women miners are demanding is a fair price for chrome. The Afrochine agent Ling and Blackie do not consider the quality/grade of chrome, they buy at a controversial face value basis as little as $22/ton,” said Chiedza Chipangura, a chrome miner and former ZMF Mashwest boss.

Chrome miners further complained that the absence of a chrome pricing model is making it difficult for them to trade their chrome.

“Women miners are demonstrating at Afrochine Damex Norton plant over unfair chrome buying prices. The government has stopped the export of raw chrome however there is no chrome pricing model,” Chipangura said.

In addition, the chrome miners demanded that Afrochine agents Ling and Blackie must be removed from the chrome business so Afrochine’s name does not get tarnished because of such actions.

Commenting on the demonstrations that took place, Afrochine said they are communicating with suppliers to purchase chrome at much higher prices.

“We want to place it on record that we are in constant touch with suppliers with a view to buying the resource at the most competitive prices. Recently, we received upwards the price of chrome ore.”

Afrochine further urged stakeholders to approach them with matters disturbing them so that emerging issues can be addressed amicably and timely.

Local chrome miners depend on Chinese investors for machinery and a market for ore. In theory, the partnerships are mutually beneficial. But in practice, Zimbabwean miners say, the relationships are exploitative.

Research showed that foreigners say paying more for chrome will run them out of business hence the low prices for chrome.

In recent years, the government-owned Minerals Marketing Corporation of Zimbabwe has paid more than $100 per ton to local miners.

BNC dumps Glencore, strikes fresh deal

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BNC dumps Glencore, strikes fresh deal

ZIMBABWE Stock Exchange-listed nickel producer Bindura Nickel Corporation (BNC) saw its sales volumes return to four digit figures during the quarter ended June 30, 2021 as offshore shipments resumed after last year’s bold step to suspend trade and pursue favourable deals.

Volumes rocketed to 1 153 tonnes during the review period after hitting a 27 tonne low during the comparable period in 2020, company secretary Conrad Fungai Mukanganga said, as he projected steeper surges to 1 687 by the end of the 2022 second quarter.

He said BNC concluded a fresh deal with Zopco SA, a Switzerland domiciled offtake partner, in place of its longrunning agreement with global commodities giant Glencore, which also hails from Zurich.

“Sales tonnage for the quarter ended 30 June 2021 was significantly higher than the tonnage sold in the quarter ended 30 June 2020,” Mukanganga said.

“In the latter period, the insignificant sales tonnage was attributable to the temporary suspension of sales, which was necessitated by the need to conclude a more favourable new off-take agreement with Zopco SA, a Switzerland based trading house, in place of the agreement with Glencore.”

Trading was boosted by rocketing international nickel prices, which averaged US$17 343 per tonne during the review period, compared to US$12 197 during the comparable period last year.

Mukanganga projected a big rise in milled ore output during the second quarter of 2022 after completing a crucial shaft re-deepening programme at Trojan Mine.

The miner saw output surge to 95 518 tonnes during the quarter ended June 30, 2021 following a production ramp up that kick off after bringing back the re-drilled shaft online from April.

Mukanganga said with the fresh capacity output would be robust in the coming quarter, rising to 164 871 tonnes of milled ore by the second quarter of next year.

“During the period March to April 2021, a planned production stoppage came into effect to facilitate the completion of the Shaft Re-deep Tie-in Project, as well as the refurbishment of major components of the concentrator plant.

Both were successfully completed,” Mukanganga said in the trading update.

“Production resumed at the end of April 2021, following the commissioning of these projects.

“Despite there being no production for most of April 2021, tonnes milled in the quarter under review, were marginally higher than for the comparative period in FY (financial year) 2020.

“This was due to the loss of production during the latter period, occasioned by the operational restrictions imposed by the government in response to the advent of the Covid-19 pandemic, coupled with the unavailability of massives in the production mix, which were in turn attributable to lagging development.

“Head grade, at 1,45%, was marginally lower than in the prior year.

“The capital expenditure which has been directed towards the replacement of ageing and obsolete mobile underground mining equipment is expected to lead to the attainment of the Company’s forecasts for the financial year ending 31 March 2022.”

Mines, like many other industries, were last year crippled by the outbreak of the Covid-19 pandemic, which forced government to roll out hard lockdowns between April and October, as the battle to combat a deadly spread kicked off.

While the mining industry was classified among essential services, serious disruptions in global supply chains grounded many as export markets briefly collapsed, which raw material and equipment import routes closed as people headed back to the comfort of their homes.

The pandemic has continued with deadly precision through a string of emerging variants, but governments including in Zimbabwe, are slowly learning to live with it, and have been taking bold steps to reopen their economies.

 

 

The Standard

Mining giant to leave London’s FTSE 100 for Sydney

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Mining giant to leave London’s FTSE 100 for Sydney

Mining giant, BHP, is set to leave the FTSE 100 index after unveiling plans to scrap the dual listing of its shares in London and Sydney.

The company, part of the UK’s blue chip index since 2001, will move its main listing to Australia as part of a huge shake up announcement on Tuesday.

BHP regularly tops the list of the FTSE 100’s biggest companies, depending on fluctuations in market values.

The move will see some investor funds that track the FTSE sell BHP shares.

“Now is the right time to unify BHP’s corporate structure,” said its chairman Ken MacKenzie. “BHP will be simpler and more efficient, with greater flexibility to shape our portfolio for the future.

“Our plans announced today (Tuesday) will better enable BHP to pursue opportunities in new and existing markets and create value and returns over generations.”

The move comes as BHP announced it was combining its oil and gas assets with Australia’s Woodside, creating one of the world’s 10 biggest producers of liquified natural gas.

BHP’s chief executive, Mike Henry, is trying to shift the company’s focus towards metals such as copper and nickel, and away from fossil fuels. BHP has also put its last thermal coal mine up for sale.

Abandoning the dual listing unwinds a structure that has been in place in 2001, when Australia’s BHP merged with the UK’s Billiton. The company was known as BHP Billiton until 2017.

Unilever has also abandoned its dual structure more than three years ago when it chose London above Amsterdam.

BHP also told shareholders that its pre-tax profit had risen to £17.8 billion in the last financial year, up from £9.8 billion. – BBC News.

Premier makes £1 million placement for Zulu lithium project

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Premier makes £1 million placement for Zulu lithium project

PREMIER African Minerals has made a placement to raise a total of £1 million for the ongoing Definitive Feasibility Studies at Zulu Lithium project in Matabeleland South.

In April, Premier announced that it had initiated a DFS and a funding strategy to be applied in future development of its Zulu lithium and tantalum project in Matabeleland South.

In a statement, the mining group said the placing has been arranged within its existing share authorities.

“The board of Premier African Minerals Limited is pleased to announce a placing today to raise £1 million before expenses at an issue price of 0,2 pence per new ordinary share for the ongoing DFS at the company’s Zulu Lithium project in Zimbabwe,” it said.

 

 

 

 

The Chronicle

Afrochine donates fuel to Mberengwa Hospital

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Afrochine donates fuel to Mberengwa Hospital

In an endeavour to fight the surge of the Covid-19 pandemic in Zimbabwe, the largest ferrochrome producer, Afrochine Smelting Private donated fuel to Mberegwa Hospital to assist in its operations.

Anerudo Mapuranga

The company speaking on its official Twitter handle said Mberengwa hospital was delighted to receive the fuel donation from the company.

“Yesterday, Mberengwa Hospital in the Midlands Province, warmly acknowledged our donation of fuel to assist the institution in its operations, esp for #Covid19 outreach and contact tracing. We have been at hand to assist them for a period now,” Afrochine said.

The company last month in its effort to fight the pandemic organized Covid-19 vaccinations for its staff, with more than 2000 already having had their first jabs.

The company procured the vaccines from the national Covid-19 stocks and brought in Chegutu district health department, using Selous Clinic staff, to administer the jabs.

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