|Govt reviews Essar deal|
|Friday, 14 September 2012 00:00|
Golden Sibanda Senior Business Reporter
the Zimbabwe Mining Indaba, Mines and Mining Development Deputy Minister Gift Chimanikire said the original US$750 million deal had to be revisited, considering that iron ore was a strategic mineral to the country.
Under the initial deal, negotiated by Industry and Commerce Minister Welshman Ncube, Essar Africa had assumed about 60 percent of NewZim Steel (Ziscosteel) and 80 percent of Bimco. Prior to the deal, Government owned 90 percent of Zisco and 100 percent of Bimco.
“Government used to own, under the then Rhodesia Iron and Steel Company, all iron ore reserves because it had identified iron ore as a strategic mineral.”
Government is largely concerned that the agreement gave Essar virtual control of most, if not all, iron ore rights, which are obviously more than what the Indian firm requires to revive Zisco. Had the deal stood in its original form, Essar was entitled to more than US$30 billion worth of iron reserves and had future plans to establish an iron ore beneficiation plant to export the mineral.
“When Government held 100 percent of the (iron ore) mineral it was because we were contributing to various companies to supply Ziscosteel (with iron ore),” said Deputy Minister Chimanikire.
Bimco), it appears the guys have 100 percent control.”
“Government policy adopted by Cabinet is that we should make sure there is value addition. We cannot indulge in an agreement that is going to ensure that they would export through that pipeline they wanted to build, although they denied it.
Against this background Government is still to assess how much it would give to Essar on the basis of NewZim Steel’s requirements, but the Indian firm would have to make a down payment first.
surrendering the nation over a bowl of soup.
“We also want to issue other firms with the claims to exploit. We do not want a monopoly, because we already have problems (in platinum),” he said.
Asked if the fresh round of negotiations would not scupper the deal, Deputy Minister Chimanikire said there was commitment from both sides.