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Murky world of Marange mining firms
Jason Moyo, Mail & Guardian (SA)
July 06, 2012

http://mg.co.za/article/2012-07-05-murky-world-of-marange-mining-firms/

Along with accusations that companies are not paying their dues, the owners remain a mystery, writes Jason Moyo. Zimbabwe's Mines Minister Obert Mpofu estimates that the country's vast diamond wealth could generate $2-billion a year, but it is increasingly unclear who is benefiting more - the government or the faceless shareholders who own the miners.

Foreigners are still queuing up to get in on the action and South Africa's Utho Capital is planning to set up a forum of the world's top diamond companies in Zimbabwe.

The Marange fields cover 123000 hectares, with only 54000 hectares being mined. The remainder is up for grabs, according to the Zimbabwe Mining Development Company (ZMDC), the state mining firm.

But even as international interest grows, the ownership of mines remains hidden under layers of secrecy.

There are currently five companies operating in Marange and other concessions in the east of the country.

Anjin

Anjin is the biggest miner in the diamond fields and there is conflict over how much it owes the government and who really owns it.

Finance Minister Tendai Biti recently said the government had received nothing from Anjin since it opened in 2009. But Munyaradzi Machacha, an Anjin director, said Biti's expectations had been too high to begin with.

"We have contributed $30-million to the fiscus. A single carat is valued at $60 and not the $1500 projected by the minister," Machacha told visiting European ambassadors last week. "He should stop persecuting innocent companies like ours."

But it is a fact that officially nobody, not even the finance minister, knows who owns Anjin, something that reflects the murky world of Zimbabwe's diamond industry.

Deputy Mines Minister Gift Chi­manikire said that the Chinese owned 50% of Anjin, the Zimbabwe Defence Industries (ZDI), a state-owned ammunitions-maker, owned 40% and the ZMDC held the remainder.

But Biti said the ZMDC did not have any stake in it and he did not know who the other shareholders were.

This week, there was more controversy - apparently the ZDI is not a shareholder in Anjin either. ZDI chief executive Tshinga Dube, a retired colonel, denied that ZDI owned a stake in Anjin. "Such an opportunity has not featured on our radar," he said.

The question then is: Who owns Anjin and who stands to benefit from its potentially massive earnings?

What is known is that half of Anjin is owned by Chinese firm Anhui Foreign Economic Construction. As part of the deal, Anhui is building a large military complex on the northern outskirts of Harare, which is being partly funded by a $98-million loan from China's Eximbank.

But what is less well known is the identity of Anhui's partner, reported to be Matt Bronze, a shelf company bought by the military to house its investments. Matt Bronze's directors have never been named publicly, but Anjin's Zimbabwean directors are almost entirely from the security forces.

Mbada Diamonds

Mbada Diamonds is a joint venture between the ZMDC and several investors, among them South Africa's Reclamation Group, which has established links with Zimbabwean state companies.

Old Mutual holds a minority stake in the firm, although it has said it would be reviewing its interests.

Among Mbada's shareholders is ex-army figure Robert Mhlanga, once President Robert Mugabe's pilot and now one of Zimbabwe's richest men. Weeks ago, it was reported that Mhlanga was building a mansion next to the Zimbali Golf Estate in KwaZulu-Natal. He insists he bought the property 10 years ago, before he went into diamonds.

In 2002, Mhlanga was a key witness in the treason case brought against Prime Minister Morgan Tsvangirai, leader of the opposition Movement for Democratic Change.

Through his Skyview Minerals, Mhlanga owns shares in Mbada Diamonds and has other interests in Zimbabwe, Angola and elsewhere in the region.

Recently, Mhlanga said Mbada had made $600-million since 2009. Half of that had been handed to the government in taxes and other fees. The remainder went into working capital and to Reclamation.

In the first quarter of this year, Mbada exported $87.6-million worth of diamonds.

Stung by United States-imposed sanctions, Mbada earlier this year claimed it was under attack from a "jealous and outright anti-Zimbabwe and anti-African agenda".

Marange Resources

Marange Resources is wholly owned by the ZMDC, after the government cancelled a joint venture with Canadile, over claims the consortium had defrauded the state.

But Canadile's Lovemore Kurotwi has claimed Mpofu demanded a $10-million bribe in exchange for a mining licence. Kurotwi wrote a letter to Mugabe detailing Mpofu's alleged demands.

Dube is chairperson of Marange Resources. It exported $11.7-million worth of diamonds in the first quarter of the year.

Diamond Mining Corporation

DMC is a joint venture between the ZMDC and Pure Diam, based in Dubai. Pure Diam's shareholders are unknown. DMC made $38.9-million in the first quarter.

Zimbabwe-Ozgeo

Zimbabwe-Ozgeo is a partnership between Zimbabwe and Russian investors. The company expects to begin operations soon in the eastern Chimanimani area. Russia, a long-time ally, has separately agreed to supply military helicopters in exchange for platinum concessions, according to the Russian newspaper Kommersant.

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