adminclaims to a former employee of NewZim Steel Limited, formerly Ziscosteel.
Mines and Mining Development Deputy Minister Gift Chimanikire confirmed yesterday that the Government was now waiting for the final report.
“We are doing due diligence over who now owns the (iron ore) claims and how the transfer was done,: he said.
“The question is how the (Gweru) mining commissioner issued the claims to an individual on a reserved area. It is an ownership issue.”
Deputy Minister Chimanikire said a team from the ministry had visited Masvingo, Mwenezi and Gweru on “an audit trail” to establish how the irregular transfer of claims had occurred.
This follows difficulties that have emerged around the transfer of iron ore claims to new co-shareholders in NewZim Steel and NewZim Minerals. This has delayed the process to revive the former steel manufacturer. The Government had a majority stake in the renamed companies before Essar Africa Holdings bought a controlling shareholding in each of them last year.
But the Mauritius-registered conglomerate, owned by Essar Global of India, has not started reviving the dormant steel giant due to problems around concessions considered crucial for a successful rebirth of the company..
Deputy Minister Chimanikire said as the licence issuing authority, the ministry had the right to exercise due diligence over transfer of mineral claims.
Irregularities emerged after it was discovered that the claims could not be transferred to NewZim Minerals as they were registered in the name of an individual. The individual is alleged to have used inside information to acquire the claims as a former employee of NewZim Minerals, formerly Ziscosteel.
This brings an intriguing dimension to the planned revival of NewZim Steel, which was brought to its knees by financial constraints three years ago.
It is understood there are serious concerns over ownership of iron ore reserves, with fears centering on the possibility of NewZim Mineral, majority-owned by Essar, controlling most of the iron ore mineral reserves.
Essar owns 54 percent of NewZim Steel and 80 percent of NewZim Minerals, which owns the majority of known iron ore deposits in Zimbabwe.
There are concerns that transferring all reserves formerly registered in Buchwa Iron Ore Mining Company, which was renamed NewZim Minerals, would create a monopoly and affect the future expansion of the steel industry. Problems with monopoly over mineral resource ownership have been encountered with such companies as Zimasco, Zimplats and ZimAlloys.
But Government will have to deal first with the ownership feud over claims transferred to an individual by the ministry’s Gweru mining commissioner, but rescinded by the chief mining commissioners over alleged irregularities. The wrangle is currently before the courts.
Revival of NewZim Steel, estimated to result in a US$750 million investment for operations and retiring debts, has been blighted by constraints around unfulfilled guarantees from some Government departments.
The guarantees include mining claims for coal, water, rail transport and fiscal concessions, which should be consistently available for sustainable revival of NewZim Steel and its mining arm, NewZim Minerals.
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