…as vast resources, govt agreement imminent
AIM-listed mining company, Vast Resources Plc is close to sealing an agreement with the government on the modalities around the undertaking of its Chiadzwa Community Diamond Project.
The project is a proposed joint venture between Vast’s majority-owned Katanga Mining Pvt Ltd and Zimbabwe Consolidated Diamond Company (ZCDC).
Vast Resources CEO Andrew Prelea said the details on the proposed agreement will be finalised by the end of this month.
“The company has received official communication from the Ministry of Mines and Mining Development to the effect that all internal processes leading to the conclusion of the joint venture are expected to be finalised during the month of March 2020,” Prelea said.
The resource firm has already arranged financing for the Chiadzwa diamond venture while awaiting finalisation of the investment agreement with the government.
The financing being arranged is earmarked for the company’s Baita Plai Polymetallic Mine in Romania and Chiadzwa Community Concession in Zimbabwe.
The company, however, is in the process of drawing down on the first tranche of the Atlas Capital Markets facility (US$7.1m).
“Discussions continue regarding the conclusion of the company’s diamond joint venture with its Zimbabwe stakeholders.
These discussions are in line with previous expectations, save on timing,” Prelea said.
On the Marange mining venture, the mining group has since concluded a joint venture with Chiadzwa Mining Resources (Pvt) Ltd, a company designated to represent Chiadzwa community interests in the Chiadzwa Community Diamond Concession.
Continued discussions are being undertaken to finalise the joint venture agreement with ZCDC which will enable the concession to procure a special grant for the mining of diamonds, the company said.
Vast’s portfolio includes an 80% interest in the Baita Plai Polymetallic Mine in Romania, where work is now currently underway towards developing and recommissioning the mine and the Community Concession Block in Chiadzwa, Zimbabwe De Beers, Vast Resources and Alrosa are the company that have been allowed to explore for diamonds in Zimbabwe making them the first companies to mine diamonds since the consolidation of the sector in 2016.
In early 2016, former President Robert Mugabe’s government evicted all diamond miners from Marange, saying their licences had expired after they declined to merge under the state-owned mining firm.
As part of its quest to attract foreign investment, the government has scrapped the indigenisation laws that prescribed that foreign-owned companies could have a maximum of 49% shareholding in the diamond and platinum sectors.
However, there are some big changes afoot in Zimbabwe’s diamond sector.
A Chinese backed company, Anjin, is set to resume mining in Marange following a three-year hiatus.