Mugabe in fresh Zimplats land grab

Google+ Pinterest LinkedIn Tumblr +

ZIMBABWE’S largest platinum producer, Zimplats, says government has filed a court application to enforce a prior notice for the compulsory acquisition of 28 000 hectares of its land.
The Alex Mhembere-led platinum mining company yesterday said the latest order was filed on June 26, 2017 as President Robert Mugabe’s government moves to grab the land, ostensibly for allocation to other investors.
“Following the objection being lodged on 24 May 2017, the government served the operating subsidiary with an order of compulsory acquisition and on 26 June 2017 the government filed a court application seeking confirmation of the acquisition,” Zimplats said in a statement accompanying its financials for the quarter to June 30, 2017.
In January, government issued – through a Government Gazette — a preliminary notice giving fresh notice that it intended to compulsorily acquire the land located within Zimplats’ special mining lease area.
Ignoring various warnings from market experts that the move would put investment-starved Zimbabwe on a collision course with foreign investors, Mugabe’s government repealed all previous notices issued in respect of its proposed compulsory acquisition of the land, unleashing a fresh threat to the miner.
This is despite the fact that Zimplats — majority-owned by South African-based Impala Platinum (Implats) — had filed opposing papers urging the courts to throw out the case on a technicality.
Zimplats, however, said it was still engaging government over the matter.
“The operating subsidiary responded to the court application and the parties are currently engaged in discussions to find an amicable resolution of the matter,” the platinum miner said.
According to Zimplats, a 2006 release of ground agreement states that “it was accepted by both the government and Zimplats that the ground that Zimplats remained with was required by Zimplats to achieve its expansion objectives”.
However, government has completely ignored this, threatening the Australia Stock Exchange-listed company of impending expiry of the miner’s 25-year special mining lease granted to its successor BHP Minerals Zimbabwe in 1994.
The 28 000 hectares has been lying idle for years and government intends to acquire and re-allocate it to prospective miners who are keen on extracting platinum for the country’s economic growth.
Meanwhile, tonnes mined by Zimplats in the quarter increased by 10 percent to 1 862 tonnes, from 1 688 tonnes mined in the prior quarter. This was due to an extra nine operating days in the quarter under review.
Revenue increased by nine percent to $143,5 million from $131,2 million on the back of a 16 percent increase in 4E metal sales volumes, which was partly offset by a general decrease in metal prices.
Net operating costs at $109,6 million were up 28 percent in comparison to the previous quarter largely due to a 16 percent increase in sales volumes.
“The net operating expenses for the previous quarter benefitted from the $8 million recognised in relation to the previously written off Reserve Bank of Zimbabwe (RBZ) debt,” the group said, adding that royalties for the quarter were nine percent higher in line with the revenue increase.
At $30,3 million, the firms profit after royalties was down 28 percent on prior quarter.