Accessibility links

Breaking News

Agreement Suspends Zimbabwe Shutdown Threat to Canadian-Operated Gold Mine

Canadian-based Caledonia Mining Corporation and the Indigenization Ministry issued a joint statement saying they had 'agreed on a process that will result in a revised indigenization implementation plan' for Blanket Mine

Operations continued Wednesday at Blanket Mine in Gwanda, Zimbabwe, following an agrement between Caledonia Mining Corporation, the mine's Canadian owner, and Minister of Indigenization Saviour Kasukuwere on the indigenization process which the government intends should place a controlling stake in the venture in black Zimbabwean hands.

The Ministry of Indigenization and Caledonia Mining issued a joint statement Tuesday saying they had met and "agreed on a process that will result in the production of a revised indigenization implementation plan for Blanet Mine that is compliant with the Indigenization and Economic Empowerment Act." The statement said the plan will take into account "the independently verified intrinsic value of the mineral resources, plant and equipment."

Consequently, the statement said, "the Honorable Minister Savious Kasukuwere has agreed to suspend the cancellation of Blanket Mine's operating llicense pending the submission of a compliant indigenization implementation plan."

Kasukuwere earlier had sent a letter to the Ministry of Mines saying Blanket's license should be suspended for failure to submit an indigenization plan conforming with the legislation and regulations. Minister of Mines Obert Mpofu said the mine's license had not been suspended.

Caledonia Mining issued a statement late last week noting Kasukuwere's letter to the Mines Ministry. The company said it had submitted a "comprehensive indigenization proposal" to Kasukuwere on May 9, following which it had received no "formal notification that the proposal is deficient or that it should be revised" by any specific deadline.

The company said then that it believed Kasukuwere had "exceeded his legal powers both in terms of his assessment of Caledonia's proposal and his request to the Minister of Mines.

The statement said Caledonia was "seeking urgent clarification from the relevant ministers, and is also consulting with its legal advisers regarding appropriate legal action."

Gwanda residents expressed anger at the prospect of the mine ceasing operations, saying they suspect top officials of President Robert Mugabe's ZANU-PF party want to grab the mine under the cover of the indigenization or black empowerment process.

Mayor Lionel De Necker said residents will not allow the government to cut off the town’s lifeblood. De Necker said Gwanda would become a ghost town if the mine were to close.

Youth In Mining Council member Buletsi Nyathi said Kasukuwere is unfairly targeting the mine. "We are worried the minister is targeting a mining firm based in the Matabeleland region as a test case for this skewed indigenization program," Nyathi said.

[Note: this article is a revised version of the report published Aug. 24 which did not include information provided by the company in press releases regarding the joint statement with the minister of Indigenization, and other pertinent details. VOA regrets these errors.]