Zimbabwe Government Seizes Land from Platinum Mining Operation - Gainesville Coins News
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Zimbabwe Government Seizes Land from Platinum Mining Operation

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Zimbabwe Government Seizes Land from Platinum Mining Operation
zimplats Zimplats processing facility in Zimbabwe
(photo: Implats)

 

The Mugabe government in Zimbabwe has seized 27,948 hectares (69,061 acres) of land from the Zimplats subsidiary of Impala Platinum (Implats,) declaring that it will offer to sell the land to new investors. Zimplats is the largest platinum operation in Zimbabwe.  Anglo American Platinum (Amplats) is the only other large-scale platinum operation in the country. Zimbabwe has the second-largest deposits of platinum and chrome outside South Africa. Currently, South Africa accounts for 80% of world platinum production.

Mines Minister Obert Mpofu, when announcing the seizure, declared that in addition to repossessing the land, the government was giving mining companies two years to build a refinery in Zimbabwe, instead of shipping the raw platinum to existing sites in South Africa. Mpofu said that Zimbabwe "has not realized significant value from the platinum sector beyond the traditional statutory payments. We can no longer continue having our minerals refined outside the country." He said that the government was going to pressure the mining companies into building the refinery by blocking exports of platinum in two years. "The ministry has decided that beyond two years, it will stop processing exports for semi-processed platinum products. This is expected to give way for companies to begin channeling resources towards value addition through establishing a PGM refinery in the country."

The mining companies have said that the current 300,000 oz annual production in Zimbabwe is not enough to support a new refinery. Last month, Zimplats CEO Alex Mhembere  told reporters that the company had already spent $30 million on a feasibility study for building a refinery in Zimbabwe, which would cost at least $2 billion.

Regarding the question of compensating Zimplats over the land seizure, Mpofu said "You can only compensate for land that has been bought. The ground belongs to Zimbabwe and there can not be talks of compensation when the land belongs to you."  He elaborated that the land was seized to prevent speculation.

A spokesman for Impala in Johannesburg, South Africa, said when contacted by reporters, that this was the first he had heard of the land seizure.

These demands come after the Mugabe government forced both Zimplats and Amplats to sell 51% of their operations in the country last month to "indigenous entities" in Zimbabwe - 10% to local communities, 10% to the mine workers, and 31% to the government.

(information from Bloomberg, Reuters and Mining.com was used in this report)

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