HomeBusiness DigestGovt suspends issuing prospecting orders

Govt suspends issuing prospecting orders

Augustine Mukaro

GOVERNMENT has suspended the issuance of mining Exclusive Prospecting Orders (EPOs), bringing to a standstill hundreds of exploration work in the countr


Hundreds of EPO applications submitted by prospective mine developers as far back as 2003 have not been processed, depriving the country of exploration money.

Speculation is now rife that government wants the mining sector to be indigenised before opening it up to more players.

The Indigenisation and Empowerment Bill, which forces foreign companies to sell 51% to locals, is now awaiting President Robert Mugabe’s approval.

Sam Chikowore, the operations director of Exporien Mining, an exploration firm, said no new EPOs has been issued despite the industry’s representation to the relevant ministries and the Reserve Bank of Zimbabwe.

Chikowore said the development has stalled any new works in the mining industry and even forced investors to opt for neighbouring countries like Mozambique, Namibia and Madagascar.

“We are now seeking audience with the highest office because representations to the relevant ministries have failed to yield any results,” Chikowore said.

“I have lost at least three bona fide investors to Mozambique, Namibia and Madagascar.”

Chikowore said the mining sector has been neglected compared to other sectors such as agriculture. Government should put in place mechanisms to safeguard the sector to ensure that players develop the mines before they offload it.

Although mining ministry permanent secretary Thulani Ndlovu could not be reached for comment, senior officials in the ministry’s Geological Survey department confirmed that there were no EPOs being processed.

“We are waiting for a government directive to process the applications,” one cartographer said. “There are a number of applications dating back to 2003.”

Chikowore said the Indigenisation and Empowerment Bill, which offered 49% to foreign investors, would be counterproductive considering the nature of the sector.

“Mining is very capital intensive particularly in procurement and maintenance of plant and mining equipment which is usually met by foreign investors,” he said. “To then offer an investor 49% considering his input would not be very encouraging. No investor would want to be a minority in such a venture.”

Chikowore said the sector believed that the indigenisation programme should have been a process done over a timeframe. He said government could also boost production in the sector through investing in servicing the equipment.

“Government can establish control units to provide service to the plant and mining equipment because costs for hiring or maintaining the equipment are very prohibitive and has adversely affected output.”

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