- December 22, 2019
- Posted in LOCAL
Investment vehicles, reportedly linked to a prominent Harare businessman with interests in mining and oil, Kudakwashe Tagwirei, are angling to buy four gold mines owned by the Government of Zimbabwe.
Well-placed sources with knowledge of the ongoing negotiations, revealed the investor was targeting gold mines owned by the State through the Zimbabwe Mining Development Corporation (ZMDC).
The assets comprise Jena Gold Mines, Golden Kopje, Elvington and Sabi. Some of the gold mines, chocked by debts have for years, been struggling while efforts to secure investors had been futile.
The Government is keen to see the mines fully operational in line with its thrust to achieve a US$12 billion industry by 2023.
Sources indicated that Landela Mining Venture, reportedly linked to Tagwirei, is one of the vehicles that have shown interests in buying and resuscitating the gold mines through fresh capital injection.
Landela recently acquired significant shareholding in Great Dyke Investments, a multimillion dollar platinum project in Darwerdnale, Mashonaland West Province, which it jointly owns with Afromet JSC of Russia.
Another vehicle Sotic, also linked to Tagwirei, snatched a 74 percent shareholding in the country’s largest nickel operation, Bindura Nickel Corporation recently.
Landela is also reported to be in the process of acquiring a stake in Zimbabwe Alloys, an integrated ferrochrome mining company
following the cancellation of US$90 million deal in which Indian firm Balasore, wanted to buy 70 percent stake in ZimAlloys.
However, contacted this week, Tagwirei said he is “neither a director nor a shareholder of Landela Mining”, without disclosing more detail.
But highly placed source that cannot be named for professional reasons said; “He is a cash rich investor who in the recent past has been buying some mining assets; platinum, nickel and chrome and now eyes gold assets. You cannot really doubt the capacity given his financial muscle.” Another source said the investor and the Government “have in principle agreed” and negotiations are already underway.
“It is an issue that is now under discussion. The Government wants to see things moving especially the resuscitation of the closed mines…it is hoped negotiations would be concluded soon,” said the source.
Permanent Secretary in the Ministry of Mines and Mining Development Onesimo Moyo, confirmed to Business Weekly that negotiations were underway for disposal of the said mines.
“We haven’t singed yet…but we are currently in discussions with an investor who wants to capitalise all (our) gold assets and we hope discussions will be finalised soon,” he said.
“The recapitalisation of the mines will also put the country on course to meet the US$12 billion mining (industry) by 2023. In October, Zimbabwe unveiled a strategic roadmap to propel the country’s mining sector to US$12 billion industry by 2023”.
Already, the mining sector is the largest foreign currency earner, accounting for 70 percent of export receipts. Under the US$12 billion mining roadmap, gold is expected to contribute US$4 billion, platinum US$3 billion while chrome, iron, steel, diamonds and coal will contribute US$1 billion. Lithium is expected to contribute about US$500 million while other minerals will contribute US$1,5 billion.
Sabi Mine in Zvishavane’s claims were first pegged in the 1890 with the first recorded production in 1909. It was acquired by ZMDC in 1984 which owns 100 percent.
The mine used to employ about 450 employees. Jena Mines, also 100 percent owned by ZMDC was acquired in 1984. It employed about 600 people and operated a multi-shaft system. Elvington Gold Mine suspended operations in 2003 due to the collapse of one of its main shafts and was placed on care and maintenance.
At some point, the mines were involved in dump retreatment in preparation for resuscitation of underground operations. Elvington used to produce 45kgs of gold per month.
The Government acquired Golden Kopje in 2007 from the late businessman McDonald Chapfika.