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Miners seek gold under the desert sands after Egypt changes rules

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Miners seek gold under the desert sands after Egypt changes rules

Mining companies awarded blocks in Egypt’s Eastern Desert are set to start exploring for gold under a legislative overhaul that seeks eventually to unlock vast untapped mineral resources.

Despite plentiful reserves and a rich mining history that gave rise to elaborate Pharaonic gold jewellery, Egypt has just one commercial gold mine in operation. Foreign investment in oil and gas has grown, but mining has languished.
Now, the country is banking on high gold prices and amended mining laws that scrap red tape and a profit-sharing rule, unpopular in the industry, to lure interest.

One year after launching its first bid round under the new rules, it has so far clinched five gold exploration contracts in a first bidding round and kept the tendering system rolling as it tries to build momentum.

The government is looking to attract $1 billion in annual investments in mining, a target industry sources say could be within reach.

“Success is ultimately going to be measured by how many mines are going to be discovered and advanced to production,” said Patrick Barnes, Head of Metals & Mining Consulting EMEARC at Wood Mackenzie, which advised Egypt’s government on its mining law reforms.

“Early indicators show us that this bid round was much better than the ones held previously.”

“Healthy mix”

In its initial tender, Egypt in November awarded 82 exploration blocks to what metals analysts say is a healthy mix of 11 companies, ranging from junior explorers to industry giants such as Barrick Gold.

The blocks on offer are in the Arabian-Nubian shield geological formation, which flanks the Red Sea and is believed to be one of the most mineral rich areas in the world.

Egypt’s mining drive is still at an early stage.

UK-based Altus Strategies told Reuters it was looking to build up its technical team and conduct remote sensing and mapping operations on the 1,500 square kilometres of land it has been awarded before starting exploration.

It expects to invest several million dollars in the short term but that could rise above $100-$200 million if a economic discovery is made.

COUNTRY IS BANKING ON HIGH GOLD PRICES AND AMENDED MINING LAWS THAT SCRAP RED TAPE AND A PROFIT-SHARING RULE TO LURE INTEREST

A spokeswoman for Canada-based B2Gold, which also won concessions, said the company was looking forward to starting exploration soon “given the relative under-investment in modern exploration, and therefore untapped potential in the historically prospective Arabian-Nubian Shield”.

Mining firms welcomed the elimination of a requirement to form joint ventures with the Egyptian government, and the capping of state royalties at 20%.

However, the retention of a tendering process for exploration blocks limits the chances of any gold boom, said Sami El Raghy, Chairman of Australia-based Nordana Pty Ltd.

“No other successful mining countries use this process. They all have a clear transparent mining laws stipulating the qualification, obligations and the rights of investors. (They) work on the principle first come, first served,” said El Raghy, who was also a founder of Egypt’s first and only commercial gold mine, Sukari.

The Ministry of Petroleum and Mineral Resources declined to comment.

Gold price

On average, a mining project goes from discovery to production in 10-15 years. While gold prices have eased after reaching a record in 2020, economists expect they will remain high by historical standards over coming years.

“If you get to a point where several discoveries are made, Egypt could be one of the largest gold producers in Africa… It had top-tier potential,” said Steven Poulton, CEO of Altus Strategies.

Environmental campaigners, however, say there is no justification for gold mining. It generates emissions, can add to water-stress and in contrast to copper and battery minerals is not in demand from technologies that can bring about a low carbon economy.

The government has said it is open to other minerals, but gold is the focus for now.

“Gold is absolutely the best thing for them to start with, because there’s a known amount of it,” said Wood Mackenzie’s Barnes.

“Egypt has immense potential for mining copper and gold and other commodities. The biggest concern in the industry is lack of supply for copper, places like Egypt which are considered underexplored and high potential are going to get a lot of attention if they can maintain investment conditions,” he added.

Reuters (By Nadine Awadalla; Editing by Aidan Lewis and Barbara Lewis)

Miners, millers seek tight security

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Miners, millers seek tight security

GOLD miners and millers have pleaded for tight security due to the increased number of robberies in mining areas.

Miners have said they feel unsafe when delivering gold due to the rising numbers of armed robberies, hence they need to be escorted with tight security. Speaking at the Zimbabwe Miners Federation (ZMF) gold millers meeting on Friday in Bulawayo, Mthandazo Women Mine in Gwanda owner Mrs Sithembiso Ndlovu said women in mining felt they were the most targeted group when it came to robberies.

“We are the most targeted group when it comes to robbery, it seems like the thieves have observed how we are operating especially when we go to carbon processors where we exchange our gold for money,” said Mrs Ndlovu.

ZMF co-vice-president Mr Mafura Sithole said engaging the police while transporting gold from one place to the other was the best way to curb cases of robberies in the sector.

“There is a need for police escort when one is transporting gold whether processed or not so as to make sure that one is safe. Also one needs to go to the police station to ask for police escort during and after carbon processing so as to be safe.

“Recently in Kwekwe a miner was robbed of US$45 000 just after finishing carbon processing due to lack of tight security hence I advice you to go to the police and ask for protection so that you are escorted during and after processing the gold,” he said.

Mr Sithole also advised miners and millers to work with ZMF so as to improve the mining industry and contribute to the US$12 billion mining sector by 2030. A miner from Munam Mine in Esigodini, Mr Amen Gumbi also noted that miners were being “harassed” by the Environmental Management Agency (Ema) officials.

“Ema wants foreign currency and most of the time they do not have change, so they must also accept bond notes and swipe like other companies for easy payments,” said Mr Gumbi.

 

The Sunday News

Lithium pilot project 70 percent complete

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Lithium pilot project 70 percent complete

AUSTRALIA-LISTED mining concern, Prospect Resources, says construction of the Arcadia lithium pilot plant is now 70 percent complete with the company expecting to start shipping high grade petalite to Europe by end of June.

The mining firm whose Arcadia project is situated a few kilometres East of Harare, produces lithium that goes into both technical (glass and ceramics) and chemical (vehicle and electronic batteries) manufacturing.

In a latest statement, Prospect said it remains on schedule to achieve the first shipment of high purity petalite by end of the second quarter.

“The company is pleased to advise that approximately 70 percent of the EPC (Engineering, Procurement and Construction) scope for its high purity petalite pilot plant is complete.

“The company remains on schedule to achieve the first shipment of high purity petalite by end second quarter of 2021. Importantly, the pilot plant remains on schedule and on budget,” it said.

Recently, Prospect announced that it was developing a smaller commercial scale pilot plant for only one of two locally available lithium varieties as the route is a lower risk pathway to near term production.

On progress regarding the development of the Arcadia pilot plant, the firm’s managing director, Mr Sam Hosack, was quoted as saying:

“The company’s project team have now delivered approximately 70 percent of the works required to commence production at our pilot plant.

“It’s pleasing to report development of the pilot plant remains on time and on budget, with Prospect on target to shipping purity petalite by the end of June 2021.

Lithium mining was designated as an integral part of the Government’s US$12 billion mining industry target by year 2023 and is a strategic subsector expected to earn US$500 million annually.

Prospect has announced that it would be producing petalite, which is technical grade and spodumene, (chemical) grade lithium samples.

The company has decided to focus the pilot plant on producing only technical grade petalite samples using dense media separation (DMS).

The latest alternative is in accordance with Arcadia’s existing feasibility Study flowsheet rather than producing both petalite and spodumene samples using a flotation flow sheet.

The DMS feasibility study flowsheet has proved to have greater technical certainty than the flotation flowsheet.

Prospect has already signed offtake agreements with buyers in Europe and other markets for its lithium output but must submit samples to determine whether its produce meets technical specifications. To qualify petalite with potential customers the company must provide samples of up to 100 tonnes per customer.

It is hoped that the production and export of petalite produced by the pilot plant will test the readiness of the regulatory and fiscal regime (including the Special Economic Zone) that will apply to the commercial operation.

The operation of the pilot plant will allow for the accumulation of knowledge during design, mitigating the scaling issues that peer lithium producers have experienced on account of a too-rapid growth in supply.

 

The Chronicle

Debswana to plow US$6bn on giant underground diamond mine

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Debswana to plow US$6bn on giant underground diamond mine

Debswana Diamond will spend 65 billion pula (US$6 billion) to build the world’s largest underground diamond mine at Botswana’s Jwaneng, which is already the richest mine by value for the previous stones.

The underground mine will have more than 360 kilometers (224 miles) of tunnel development and will hit full production by 2034, Debswana’s head of transformation and innovation, Thabo Balopi, said at a briefing in the capital, Gaborone, on Friday.

The underground mine will have a capacity of as much as nine million carats per year, extending Jwaneng’s lifespan by 20 years, according to Balopi. 

An early access decline will be in place by 2023, he said.

“We are still doing the studies toward transforming to an underground producer, which is a very different environment, with different capabilities and mindset,” he said.

‘Huge Undertaking’

Going underground will be a “hurdle” for the group, which has operated exclusively as an open-pit miner since its establishment in the 1970s, according to acting managing director Lynette Armstrong.

“It’s a huge undertaking,” she said during the briefing.

The board of Debswana – a 50/50 joint venture between De Beers and Botswana — is yet to make a final decision on how to finance the project, according to head of technical services Len Dimbungu.

The last expansion at Jwaneng had a 24 billion pula budget and transformed the mine into one of the world’s largest open-pit diamond operations.

Diamond mining has traditionally anchored the Southern African nation’s economy, accounting for the bulk of budget revenue and foreign-exchange receipts.

Jwaneng, in operation since 1982, has been expanded several times as its resources declined over the years. 

The mine is critical to De Beers, and produced 7,5 million carats of the group’s 2020 output of 25,1 million carats. Jwaneng produced 3,2 million carats in the first quarter, or 41 percent of De Beers’ total production. – Bloomberg

Gold buyer loses US$45k to fake gold dealers

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Gold buyer loses US$45k to fake gold dealers

A HARARE businessman was allegedly duped of US$45 000 after being sold fake gold.

Three men — Stephen Mhumbwe, Louis Mudzongo and Mike Tafira — appeared before Harare magistrate Mr Dennis Mangosi on Thurday and were remanded out of custody to June 2. It is the State’s case that the trio connived and duped businessman only identified as Mr Mashiri who is a registered gold buyer and sold him what later turned out to be fake gold. 

It is alleged that Mudzongo was approached by Tafira who told him that he had some people selling gold in Ngezi and were looking for a buyer. Mudzongo reportedly engaged Mhumbwe to look for a buyer. Mhumbwe allegedly approached Mr Mashiri and convinced him that he had a brother, Mudzongo, who was selling gold and Mashiri got interested

It is the State’s case that Mashiri was later linked to a person only known as Mashonganyika who was reported to have the gold. 

Mhumbwe accompanied Mr Mashiri to meet Mashonganyika who was in the company of one Jena and T-One where the transaction was conducted after Mashiri was convinced that it was genuine and paid US$45 000 through Mhumbwe.

Later on, Mashiri discovered that it was not gold and that he had been defrauded prompting him to make a police report.

No recoveries were made as the trio became evasive.

Lancelot Mutsokoti prosecuted.

Masvingo Mines office in corruption saga

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Masvingo Mines office in corruption saga

The Masvingo Provincial Mining office has been hit by corruption allegations with the Mining Engineering, Geology, and Survey departments sucked in what could be a criminal cartel meant to defraud miners of their mining rights.

Rudairo Mapuranga

The allegations of air pegging, backdating of applications, and double allocation of claims in the province have been labeled a sole creation of the Ministry’s deep-rooted cartel which is meant to defraud miners the chance to enjoy the country’s resources.

It is alleged that the mining engineering department led by Engineer Claud Shonhai with the blessings of the Provincial Mines Director is leading the cartel which works with Geologist Malunga and from Survey Chikoto.

The cartel is allegedly working to dispossess a Chrome mine claim with over 50 percent chrome samples prospected by TSMG mining syndicate in Chiremwaremwa Chegwite to give to Zimplats Geologist Tendai Manyange.

The saga

It is alleged that TSMG Mining syndicate sought pegging services to peg a chrome claim in Chegwite through Masvingo Mines Geologist named Malunga. Upon finding that the area was chrome rich TSMG Mining syndicate claims Malunga allegedly informed his colleagues to craft stories and excuses meant to deprive the TSMG of their right to own the claim legally.

It is said that the syndicate (TSMG) was initially advised that the area was free to peg, however after submission of notification and registration fee through the help of an approved Prospector named Tinashe (whose work was a reference from Engineer Claud Shonhai) the syndicate was told that the area was under Save conservative when the syndicate questioned the truth of the Ministry’s position, goal posts were shifted that the area was under ZMDC.

It is alleged that Chikoto and Shonhai then went to one of the TSMG director’s father and convinced him to partner with them to form a syndicate and peg the area. The story is that the officials of the Mines Ministry initially wanted to give the area to Tendai Manyange whose prospecting license application was done by Malunga.

Things done wrong

Malunga who is a permanent employee of the Ministry of Mines and Mining Development acted as a prospector when he pegged for TSMG Mining syndicate in Chegwite.

According to the Prospector Tinashe, Malunga used his GPS equipment to take coordinates and collected prospecting or pegging and consultancy fees from TSMG syndicate this he did in Tinashe’s name since he’s an approved prospector. It is also alleged that TSMG syndicate was ordered to work with Tinashe by Engineer Shonhai against their rights to choose a prospector of their choice.

It is alleged that Manyange used one of the Mines officials to get a prospecting license instead of a consultant company, TSMG Mining syndicate believes that Shonhai was used to get the prospecting license. Tinashe admitted that he received  Manyange’s prospecting license from Malunga to peg him a claim.

However Manyange said he does not know anything regarding prospecting in Masvingo, he said he had never been anywhere outside Kadoma for a very long time.

“I stay in Ngezi work here and literally have been here for the past year and a half ever since lockdown. The only Ministry point I have set foot at is the Ministry of Lands in pursuit of my farming papers otherwise I still think you have the wrong person,” he said.

Shonhai did not answer the questions sent by Mining Zimbabwe, Malunga and Chikoto’s phones went unanswered.

Second quarter wage negotiations long overdue – ZDAMWU

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Second quarter wage negotiations long overdue – ZDAMWU

ZDAWU press release

The Zimbabwe Diamond Allied and Minerals Workers Union (ZDAMWU) is worried about delays or unwillingness by concerned parties to conclude 2nd quarter wage negotiations. The negotiations are long overdue.

The 2nd quarter wage negotiations are coming against the backdrop where every mine have practically failed to pay the  January February back pays. The reason for this travesty of justice on mine workers is because the 1st negotiations were concluded late that is  in March when the March payroll was already being processed.

It is disturbing to note that some mines are already applying for exemptions not to pay the back pays.

The reason why we are having these challenges is because of the connivance between  AMWUZ and their handlers (Chamber of Mines) to short change the workers as they are waiting  to hear a new wage increase from NEC.

Cry the beloved workers. It is a known fact that workers are expecting  a second quarter increase effective on the 1st of April.

Hope is fast fading for mine workers, considering that April is coming to an end and there has been no sitting. Chances of workers receiving the back pays are fast fading.

A critical question is that why didn’t the negotiators  a dollar value increase in March  when they signed the 1st quarter.

A normal and an effective trade union should have pushed the Employers Chamber of mines to agree on a dollar value increase for the 2nd quarter since the 1st quarter was complicated  last month March  so as to avoid this unnecessary claim of back pay each time wages are increased.

Who is benefiting from this unreasonable approach to issues of bread and butter?

Maybe it’s  because our friends in AMWUZ get seating allowances for every seating they attend.

Our resolution as ZDAMWU is that as long  as the mining  sector is still paying these  slave wage, workers will not rest.

As mine worker representatives we are not going to tire in pushing for a living wage in the range of USD$ 400-600.

In addition, mine workers are also so disappointed by the failure to consider the  Covid-19 allowances were the sector was the only industry that remained on the ground and sustained other sectors during the lockdowns.

It’s sad the parties to the negotiating table don’t consider these facts.

As a people-centred union we are going to continue capacitating our members through trainings which are currently underway, as we are giving workers skills to bargain at works council level.

We are also encouraging workers committees to take the bargaining to works council as waiting  for  NEC will not help them as well.

It’s better to get an increment now than waiting for a back pay.

SMM investment capital looted

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SMM investment capital looted

As much as US$16 million was allegedly looted from SMM Holdings after administrator Afaras Gwarazimba lost control of the company to the State-owned mining entity, Zimbabwe Mining Development Corporation about 10 years ago.

SMM, formerly owned by businessman Mutumwa Mawere was placed under reconstruction in terms of Presidential Powers (Temporary Measures) (Reconstruction of State-Indebted Insolvent Companies Act) on September 16, 2004.

Government, through ZMDC took over the management of SMM in 2011 and reportedly injected US$16 million which, Gwaradzimba intimated in a recent meeting with employees, was stolen because he had lost control of the company.

The latest revelations are in an application by SMM workers through the Zimbabwe Diamond and Allied Minerals Workers Union to the Minister of Legal, Justice and Parliamentary Affairs Ziyambi Ziyambi seeking removal of Gwaradzimba.

Employees of SMM, the parent company of Shabanie and Gaths mines claim Gwaradzimba continued stay in office is illegal. In terms of the Act, Ziyambi is empowered to vary the reconstruction order by removing Gwaradzimba and any other person appointed to assist him. But this will need the High Court confirmation.

The workers claim Gwaradzimba, in a meeting held on March 8 this year intimated his continued stay in office was illegal as he was, at some stage, relieved of his administrative duties after the management of the company was transferred from Ministry of Justice to ZMDC under Mines and Mining Development Ministry.

He was to be re-appointed informally by a Cabinet Committee handling the SMM portfolio.

Gwaradzimba and SMM are being cited as first and second respondents respectively.

According to the application, Gwaradzimba was relegated to only deal with litigation brought against SMM by Mawere. 

“The 1st respondent stated in our meeting that the ZMDC board had a US$16 million capital injection from the Government but it was squandered because he had no control over the company or funds,” read part of the application, now before Minister Ziyambi Ziyambi.

When he was “informally” reinstated, Gwaradzimba is said to have indicated that despite the capital injection, the company found itself in financial challenges, “having wasted investment capital on purchases of motor vehicles” and salaries.

Gwaradzimba also alleged late former president Robert Mugabe rejected the investor he had secured and directed the company removed from the Minister of Justice, then under Patrick Chinamasa to Ministry of Mines under Obert Mpofu.

Nearly 1000 ex-employees are owed US$17,6 million. The company is also said to have outstanding obligations amounting to about US$3,4 million to the Mining Industry and Pension Funds and US$2,7 million to National Social Security Authority.

Asset stripping

The workers have also alleged Gwaradzimba was converting SMM mining leases into residential stands. It is further alleged that he has already raised US$50 million through a deal struck with a local bank involving disposal of land under mining leases.

“He divulged that he is converting mining leases belonging to second respondent into residential stands….he claims he wants to (use the funds) to service  what is owed to employees.

“These actions amounts to asset stripping. The obvious and natural consequences is that this undermines the viability of second respondent as a going concern.

“Effectively, first respondent has abandoned his primary duty of securing investors to resuscitate second respondent and then service the company’s debts.

Waning revival prospects

While the revival of Shabanie and Gaths mines remain a priority, some experts believe resuscitating the two mines might not make economic sense given high levels of structural weaknesses, huge capital outlay needed and low global demand of the fibre.

Instead, Government might need to concentrate on the dumps for the local market as challenges on the ground are clear that reviving the mines might not be feasible.

Some investors have been previously linked to the resuscitation of the mines over the past few years, but there hasn’t been much achieved in the regard. According to SMM, about US$120 million is needed to revive the two mines. Mining experts say that after the mines ceased operations, there was no proper care and maintenance, resulting in both mines flooding, thus submerging equipment.

The experts also said the mines have suffered fatal geotechnical failures such as roof collapses which makes it difficult “if not impossible” to access critical mining levels.

Similarly flooding may cause rock strata stability challenges, which calls for huge capital to reopen the mines.

The top three levels of Gaths mines are said to have collapsed due to flooding of the mines.

Compounding challenges related to the re-opening of the mines is that potential investors may not be keen to go into asbestos on the back of the lobby to ban the mineral.

Health authorities around the world have long advocated against the use of asbestos, saying it posed health risks when the silky fibres that make up the mineral get into the air that people breathe. When inhaled in significant quantities, asbestos fibres can cause a scarring of the lungs that impedes breathing; mesothelioma, a rare cancer of the lining of the chest or abdominal cavity; and lung cancer.

Asbestos, which is widely used in the construction and other industries has been banned in many developed countries, including the European Union. In some countries, such as Canada its use is strictly controlled through the laws, according to reports.

Business Weekly

Umguza small-scale miners cry foul over double pegging

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Umguza small-scale miners cry foul over double pegging

ARTISANAL and small-scale miners in Umguza District, Matabeleland North have raised concern over double pegging of mining claims.

Speaking on the sidelines of the Umguza Miners Association revival meeting last week, the newly-appointed Umguza Miners Association chairman, Mr Themba Tshuma said there has been a growing number of mining claims that have been double pegged. He said a miner who had all the documents and had his claim pegged in 2004 clashed with a person who later on brought papers dating back to 1994, claiming to be the rightful owner of the pegged area.

“What usually happens is that when you start making money, you start to see well-financed people coming with documents which state that they also pegged the same area in the 1990s. What will be surprising is that you would have been mining at the place for six years. You then ask yourself where were those people before you unearthed more gold in the place?”

He also noted that the Ministry of Mines and Mining Development office in the province was failing to address the issue. However, the provincial mining director for Matabeleland North Mr Farayi Ngulube said the issue of double-pegging was not peculiar to Umguza District.

“It’s inevitable in most cases because either there will be human error or the cause will have to do with the state of our maps that are torn, tattered and most likely now invisible due to being handled countless times over the years. So there is a need for new maps and putting the cadastre system into use to address these issues,” said Mr Ngulube.

Commenting on the issue of double pegging, Parliamentary Portfolio Committee on Mines and Mining Development chairperson Mr Edmond Mkaratigwa said the case of double pegging in Matabeleland North was a tip of the iceberg regarding what was prevailing in the country.

“Our pegging system has been mostly manual in terms of boundaries and that is why we have always been making a lot of noise for the introduction of the electronic mining cadastre system and the process is moving, although not as fast as we anticipated. As a committee we have recommended the speeding up of the implementation of the cadastre system in the country,” said Mr Mkaratigwa.

 

The Sunday News

Machete gang hits Gwanda Mine

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Machete gang hits Gwanda Mine

A gang armed with machetes and axes raided Dubane Mine in Gwanda and got away with R700, police have confirmed.

Matabeleland South police spokesperson Inspector Loveness Mangena confirmed the incident that happened around 8.30 pm last Wednesday. She said the seven men arrived at the mine and found two workers, Lastboy Ndlovu (21) and Prince Ncube (27). They then demanded money from the workers while threatening to axe them.

Insp Mangena said the two were saved by villagers staying close by who managed to help apprehend three of the gang members while the other four got away with R700 taken from the workers.

“The case was reported to the police the very same day and three accused men were arrested. These being Steven Moyo (37) from Guyu under Chief Marupi, Richard Mangena (31) from under Chief Mathema in Gwanda and Melusi Nyoni (18) from Guyu. Society must emulate what these villagers did as they worked hand in glove with the police in apprehending the robbers,” said Insp Mangena.

She, however, warned members of the public that if they are raided by armed gangs, they must not fight back, adding that businesses such as mines should also improve security to protect their properties.

The Sunday News

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