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Strange Platinum Rumblings in Zimbabwe PDF Print E-mail
Mining and Politics in Zimbabwe
Written by Barry Sergeant   
Thursday, 26 June 2008 08:12
Foreign Mining companies are under pressure to stop investing in Zimbabwe under the current regime of President Mugabe. The new round of sanctions against Zanu-PF by Western governments will include asking mining companies to stop their activities in Zimbabwe. Mining giant Anglo-American is increasingly under pressure to abandon its $400 million platinum investment in Zimbabwe.

Has Anglo American CEO Cynthia Carroll lost the Zimbabwe plot, or is she squaring up for a battle of a completely different kind?
On Wednesday, Anglo American, a transnational mining company, finally reacted to media speculation over its involvement in Zimbabwe, specifically in connection with the Unki platinum project, situated on Zimbabwe's Great Dyke, the world's second largest repository of platinum group metals, after the Bushveld igneous system in South Africa.

Accused of wanting to build a platinum mine costing $400m that would somehow support Zimbabwe president Robert Mugabe, a clearly stung Anglo American attempted to deflect attention to the "wellbeing of its more than 650 employees and contractors" involved in the Unki project. The London Times echoed the concerns of a number of parties in stating that the proposed Unki investment "is believed to be the largest foreign investment in Zimbabwe to date, just as the British Government puts pressure on companies to withdraw from the country".

Anglo American CEO Cynthia Carroll has taken some flak over the corporation's stance on Zimbabwe. Anglo American holds a primary London listing, and, as such, is expected to comply with UK pension fund ethical guidelines. Legal & General, Anglo American's largest single shareholder with a stake of about 5%, was quoted as saying that "we have a corporate and social responsibility policy and that overrides all investment activity".

Anglo American's announcement on Wednesday did not mention Johannesburg-listed Anglo Platinum, the 76%-held Anglo American subsidiary that houses the Unki project.
The Unki project is already boiling in scandal for other reasons. In April, London-listed Camec announced that it had acquired an interest in "platinum mining assets in Zimbabwe" via the acquisition of 100% of Lefever, a British Virgin Islands company. Lefever owns 60% of Todal, a Zimbabwean company, "which in turn has the rights to certain platinum concessions in Zimbabwe". The remaining 40% of Todal is held by the Zimbabwe Mineral Development Corporation (ZMDC), the Zimbabwean State-owned mining company. The key assets held by Todal are the Bougai and Kironde claims, previously held by entities controlled by Anglo Platinum.
For Lefever, Camec agreed to pay $5m cash, plus 215m new Camec shares (currently worth $233m). Camec also agreed to loan $100m to Lefever (to be repaid from the ZMDC's share of dividends from Todal). Neither Camec nor its paid representatives have been prepared to disclose the see-through identity of Lefever, but international media have noted that the transaction took place when a Chinese arms shipment was about to dock on African shores with goods destined for Zimbabwe.

When asked about the background to Camec acquiring two Anglo Platinum concessions, Anglo Platinum finally stated on April 22 that it still owns and continues "with some development at Unki". It turns out that Anglo Platinum entered into a deal with the government of Zimbabwe "that will result in the cession of certain claims to government, in exchange for indigenization credits".
The cession of the claims, Bougai and Kironde, Anglo Platinum said, did not affect the development of Unki. However, the latest Anglo Platinum annual report stated that as of 31 December 2007, "Anglo Platinum envisages a 51% controlling share in the Unki Platinum Mine". It appears that the game shifted from negotiating stakes in the overall Unki project, to Anglo Platinum sacrificing Bougai and Kironde. There is no indication that Anglo Platinum was paid a penny for the sacrifice, but there is public evidence that some faceless person/s has benefited to the tune of more than $300m, in cash and near-cash.
Camec made some prominent investment headlines last year when it made a (later failed) bid for London- and Toronto-listed Katanga Mining. At the time, Camec, directed by executives Phillipe Edmonds and Andrew Groves, was battling Dan Gertler over Mukondo Mountain, a significant cobalt-copper deposit in Katanga Province, Democratic Republic of the Congo.
Camec apparently acquired its Mukondo stake from well-known Zimbabwean Conrad Muller "Billy" Rautenbach, while Gertler bought his stake from ex-Zimbabwean John Bredenkamp. The parties made peace earlier this year after Gertler vended his stake in Mukondo into Camec, in return for a substantial stake in Camec.
This time around, Camec may find itself in a battle with Anglo American, over Unki. Time will tell if Bougai and Kironde were the eyes plucked out of Unki and handed on a plate to Camec. If nothing else, Anglo Platinum's activities at Unki had long moved beyond the greenfields stage.

With development of underground declines ahead of schedule, Anglo Platinum intercepted the orebody at Unki in September 2007, and initiated the startup of a stockpile. Anglo Platinum had long settled on Unki as a 120,000 ton a month operation, with both mine and concentrator built to allow expansion. The concentrate would be transported to Anglo Platinum refinery facilities in Polokwane, South Africa.
Construction of the concentrator is yet to start up. On Wednesday Anglo American stated that Unki, "in development since 2003, is a long-term investment for a mine which is yet to start production and will not generate revenues for some years". By contrast, in April this year, after apparently acquiring Bougai and Kironde, Camec stated that it "believes it will be able to bring a mine into production, producing 120,000 -150,000 ounces per annum at a capital cost of approximately $200m within 18 months". Something clearly doesn't add up.

Anglo defends $400m project in Zimbabwe

Author: Sure Kamhunga
Posted: Thursday , 26 Jun 2008

ANGLO American yesterday defended its planned $400m platinum project in crisis-torn Zimbabwe, saying the government there had confirmed it would simply take over if the company withdrew from the project.

Reacting to a report in the Times of London that the UK foreign office was investigating whether Anglo's Unki mine would contravene sanctions imposed on Zimbabwe, the company said it was not about to abandon the project, because it had not broken any laws.

Former colonial power Britain is one of the western countries trying to isolate Zimbabwe because of human rights abuses and violence after disputed presidential elections.

Anglo said the project had created direct employment for 650 people. Hundreds more had been retained by contractors working on the mine.

The project had not contravened any local or international laws, Anglo said.

However, the company condemned the violence and human rights abuses taking placing in Zimbabwe.

The project, which is owned by Anglo American Zimbabwe, but managed by Anglo Platinum, is making progress towards achieving full production of 120000 tons a month by the fourth quarter of 2010.

Unki lies on the Great Dyke, which varies between 10km and 30km in width, and comprises a large sulphide zone, of which 2,5m is mineralised.

“It has been made clear to Anglo that if it ceases to develop this project, the government of Zimbabwe will assume control," Anglo said of the mine, which is one of the single-largest mining investments in Zimbabwe in more than a decade.

“The Unki platinum project in Zimbabwe, which has been in development since 2003, is a long-term investment for a mine which is yet to start production and will not generate revenues for some years.

“Anglo American is monitoring the situation in Zimbabwe very closely and is reviewing all options surrounding the development of the project.”

Anglo said it had a clear responsibility to protect the wellbeing of its employees on the mine and contractors, including their families and their indirect dependents, whose livelihoods would be jeopardised should the company withdraw from Zimbabwe.

“The responsible development of the Unki mine will create long-term viable business which will be important to the economic future of Zimbabwe for years to come.”

“Anglo American continues to support the communities around the project with a number of important social development activities, including the provision of basic food and supplies, the building of a dam to help support agriculture, and other assistance to the primary and secondary schools and community health facilities.”

Anglo also has a 37,2% stake in Tongaat Hulett, a sugar and starch group with operations in Zimbabwe and employs 16 000 people.

 

Anglo reviewing platinum project in Zim

Anglo American says it can’t give a firm answer on the future of the Unki platinum project yet as it is reviewing the “fluid” situation in the country.

Author: Tessa Kruger
Posted: Wednesday , 25 Jun 2008

JOHANNESBURG -

Anglo American could not give a definitive answer yet on the future of its Unki platinum project in Zimbabwe as the company was reviewing the "fluid" situation in the country on a "very regular" basis.
The company spokesperson in London, James Wyatt-Tilby, said Wednesday that Anglo had to keep a very close eye on what was going on in Zimbabwe as it was deeply concerned about the political situation in the country.
"We made it clear in our statement that in happy circumstance we can develop the project into a long-term viable business," Wyatt-Tilby said. But we can't give a firm answer yet, as we are continuing to review the situation."
Anglo American said in a statement today it was reviewing "all options" around the development of the Unki platinum project in Zimbabwe.
The project was a long-term investment for a mine which is yet to start production and will not generate revenue for some years. It has been made clear to the mining company that the Zimbabwean government would assume control of the project if its development was halted.
Anglo said it had a clear responsibility to protect the wellbeing of its more than 650 employees and contractors, as well as their families and those who depended indirectly on the activity around the project.

ARM includes Zimbabwe in Africa growth plans

by Charlotte Mathews

AFRICAN Rainbow Minerals (ARM) has taken a contrary view on Zimbabwe, at a time when Anglo American has also come under fire for its presence in the embattled country.

ARM, the black empowerment group headed by mining entrepreneur Patrice Motsepe, applied in March for mineral rights over platinum group metals deposits in Zimbabwe’s Great Dyke, head of investor relations Monique Swartz confirmed yesterday.

Zimbabwe’s Financial Gazette reported ARM would have filed its applications three months after Motsepe was rumoured to have met President Robert Mugabe.

Asked why ARM had applied for the rights at this time, Swartz said “as part of ARM’s strategy to grow into Africa, initiated in 2005, we have been pursuing opportunities in various southern African countries for a few years”.

ARM, created in May 2004, has ferrous metals, platinum, coal, base metals and gold interests. In its prior financial year the biggest contribution to attributable earnings before interest and tax came from its platinum operations, which include a 50% stake in Modikwa Platinum Mine, 55% of Two Rivers Platinum Mine, 50% of the Nkomati nickel mine and 90% of the Kalplats exploration project.

Last week Anglo American was under fire in various UK papers for proceeding with its $400m Unki platinum project in Zimbabwe. The Times said the foreign office was looking into whether Anglo had defied sanctions.

Anglo said it had not broken any laws and would not drop the project, as the Zimbabwean government had confirmed it would just take it over.

Another UK-listed company criticised from various quarters — including The Telegraph and industry websites — for its involvement in Zimbabwe is Central African Mining & Exploration (Camec). Camec made a $100m loan to the Zimbabwean government in April, as part of a deal in which it got two claims on the Unki property Anglo was pressed into handing over under Zimbabwe’s indigenisation policy.