HARARE, June 9 (The Source) – The government has laid claim to gold deposits on the banks of Gache Gache River in Kariba and elbowed out a contractor who discovered the precious metal while extracting sand for construction work at Kariba South Power Station, documents at hand show.
Minister of Mines and Mining Development Walter Chidhakwa on May 8 told journalists that the ministry had “accidentally” discovered the fresh platinum and gold deposits and that it had swiftly moved in to ring fence the area.
However, documents seen by The Source show that government was in fact made aware of the deposits by Townsend Enterprises when it applied for a special dispensation to recover the gold from the Gache Gache riverbed sand before it is used in construction.
The minister did not respond to the application, but instead moved teams from the government’s wholly-owned firms, Zimbabwe Mining Development Corporation and the Zimbabwe Consolidated Diamond Company, onto the site to conduct large-scale mining and prospect for diamonds.
Townsend is a private company subcontracted by the Zimbabwe Power Company (ZPC) to supply washed sand to Sino Hydro, for use in construction at the $355 million project to expand the Kariba South hydro-electrical plant.
The first sand supplies were made in December, after which a quality confirmation test showed the presence of gold. About 40 grammes were found in less than 100 kilogrammes of sand although later tests suggested a concentration of up to seven grammes per tonne.
Deputy Minister of Mines, Fred Moyo, confirmed to The Source that Townsend had applied for the special dispensation and that he had told the company that its chances of success were slim due to a ban on riverbed mining.
In December 2013, the government ordered mining companies to stop riverbed mining activities following destructive mining practices on Mazowe River by small-scale Chinese miners.
Government tightened the regulations in Statutory Instrument 92 of 2014, Environmental Management (Control of AlluvialMining) regulations, which bans alluvial mining in river beds, banks, wetlands and any land within 200 metres of naturally defined banks.
But new proposals in the draft Mines and Minerals Amendment Bill allow riverbed mining when the mining operation is in a joint venture agreement with the government.
“I told them that their application was unlikely to succeed because there is a government ban on river bank mining,” Moyo said.
The government instead proposed to compensate the company for any additional revenue loss, he said.
The deputy minister also said government had moved mining equipment onto the Gache Gache site, but he was not aware of any mining plans or new developments on the application by Townsend.
Last weekend, Chidhakwa toured the site, along with Finance Minister Patrick Chinamasa and Ignatius Chombo, the Minister of Home Affairs.
Chris Hokonya, a former chief executive of the Chamber of Mines and a director at Townsend, declined to comment on the development.
“I am the chairman of Townsend Enterprises and Chapungu Safaris but beyond that, I cannot comment on an issue that is ongoing. I would advise you to speak with the Ministry of Mines because they are aware of all the details on the issues you have raised and our position,” he said in an emailed response to questions from The Source.
Documents seen by The Source indicate that Townsend approached the Reserve Bank of Zimbabwe governor, John Mangudya, after the discovery of gold. The central bank is the sole buyer of gold in the country through its Fidelity Printers. The governor advised the company to deal with the mines ministry.
The principal director in the ministry, Valentine Vera, demanded that government carry out its own tests, which then showed the presence of platinum and tantalite.
ZMDC officials then requested to meet Townsend officials to discuss the parastatal’s involvement in the project but pulled out at the last minute.
In April, Vera asked for clarity on the equipment to be used by Townsend and also viewed the equipment which had been reserved by the supplier.
It later emerged that government had attempted to buy the equipment reserved by Townsend before importing second hand machinery from South Africa, which it moved onto the site.
Government officials communicated entirely by telephone in the whole process, avoiding any paper trail.