Namibia has "shot itself in the foot" by announcing that Government now has exclusive exploration and mining rights of all the country's strategic minerals through its state-owned Epangelo Mining Company.
Mines and Energy Minister Isak Katali's statement in Parliament last Wednesday that Cabinet has declared uranium, copper, gold, zinc and coal as strategic minerals of which Epangelo holds the exclusive exploration and mining rights, is rocking the international investor boat.
Concerned investors, busy with mega-deals locally, have spoken to The Namibian on condition of anonymity from as far as London, expressing their concern and confusion about the announcement. Epangelo, with a budget of only N$5 million for the current financial year, simply doesn't have the capacity to exercise these rights, they claim.
Approached for comment yesterday, Katali said there should be no confusion.
"Epangelo will have the exclusive exploration and mining rights, all 100 per cent of it, of all these strategic minerals," he said.
Investors interested in these sectors will have to approach Epangelo to become partners in exploration and mining ventures of this nature, he said.
Katali said Government is aware that with such a small budget, Epangelo has capacity constraints. That is where partners will fit in.
Investors will have to negotiate with Epangelo for a share of the interest in ventures, Katali said. He didn't want to elaborate on how big a shareholding they will be entitled to, but indicated that Epangelo will be the majority shareholder.
When he announced Cabinet's decision last week, he said "so that the Namibian citizen can fully reap the benefits arising from the rich endowment of our mineral resources".
While sources who The Namibian spoke to were afraid to comment on record, world-renowned mining analyst, David Hargreaves, however, didn't mince his words.
In the latest international newsletter, Hargreaves: The Week in Mining, he said: "Just as you give a nation a clean bill of health, it goes on a foot-shooting spree."
Recapping Katali's parliamentary statement, Hargreaves said: "Will Africa ever learn?"
Mining last year contributed about 15 per cent to Namibia's gross domestic product and its export earnings were more than half Namibia's total export revenue. Namibia recently retained its position as the fourth biggest uranium producer in the world.
Katali last week said his Ministry's priority this year will be to finalise the Minerals Bill and minerals policy to allow Epangelo "to fully participate in the exploration and mineral development" in the country.
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