Gov­ern­ment ven­tures into min­ing

Lesotho Times - - News - Lekhetho Nt­sukun­yane

GOV­ERN­MENT has reg­is­tered the coun­try’s first state-owned min­ing com­pany that would re­cover any di­a­monds that might be where poli­hali Dam would be con­structed in Mokhot­long.

The firm, Poli­hali State Di­a­mond Min­ing Com­pany pro­pri­etary Limited, was reg­is­tered in Novem­ber 2014 and would en­gage in al­lu­vial ex­ca­va­tion only.

Min­ing min­is­ter tlali Khasu, the min­istry’s prin­ci­pal Sec­re­tary (ps) ’ Ma­phutheho Ranooe, Fi­nance ps Khosi Let­sie, Law and Con­sti­tu­tional Af­fairs ps te­bello tha­bane and for­mer tourism and en­vi­ron­ment ps Sa­muel Ra­papa, are listed as di­rec­tors of the com­pany due to their po­si­tions in gov­ern­ment. how­ever, Mr Ra­papa, yes­ter­day told the Le­sotho times he was no longer part of the set-up fol­low­ing his res­ig­na­tion from the min­istry last month.

Con­firm­ing the de­vel­op­ments to the Le­sotho Times yes­ter­day, Mr Khasu said: “A cabi­net de­ci­sion was reached some­time in 2013 for the estab­lish­ment of a state-owned min­ing com­pany.

poli­hali State Di­a­mond Min­ing Com­pany was then reg­is­tered last year, for the sole pur­pose of al­lu­vial di­a­mond-search in poli­hali be­fore dam-con­struc­tion be­gins.

“Gov­ern­ment de­cided to es­tab­lish this this firm to avoid prob­lems that al­ways come with for­eign com­pa­nies or even lo­cal ones get­ting such ten­ders. For in­stance, the gov­ern­ment is pay­ing thou­sands of mal­oti to peo­ple who went to court to com­plain that they had min­ing rights in some ar­eas where such op­er­a­tions were tak­ing place.”

Ac­cord­ing to Mr Khasu, the com­pany would be dis­solved as con­struc­tion of poli­hali Dam, which starts in 2017, nears com­ple­tion.

Mean­while, the com­pany’s for­ma­tion comes at a time the pol­icy Anal­y­sis and Re­search In­sti­tute of Le­sotho (paril) has rec­om­mended the estab­lish­ment of such a firm wholly owned by gov­ern­ment “for Le­sotho to max­imise re­turns from min­ing op­er­a­tions.” paril — a non-gov­ern­men­tal or­ga­ni­za­tion (NGO) con­duct­ing re­search stud­ies on na­tional poli­cies among other func­tions –– last year worked in part­ner­ship with South­ern African Re­source Watch (SARW) to pro­duce a re­port on the own­er­ship of min­eral rights in Le­sotho.

In the re­port, paril rec­om­mended that gov­ern­ment should find ways to man­age its eq­uity “in or­der to en­able proper co­or­di­na­tion and re­port­ing by peo­ple rep­re­sent­ing it in min­ing com­pa­nies’ boards.”

the re­port added: “there is need for gov­ern­ment to es­tab­lish a state-owned min­ing com­pany, which would take con­trol of all eq­uity held by gov­ern­ment in min­ing op­er­a­tions.

the com­pany will rein­vest div­i­dends into de­vel­op­ing its ca­pac­ity in or­der for Le­sotho to max­imise re­turns from th­ese min­ing op­er­a­tions. the rein­vest­ment will not only be limited to in­vest­ing in Le­sotho but could buy shares in min­ing gi­ants such as Gem Dia- monds and oth­ers.

“this will also en­sure the coun­try is able to train and re­tain skilled per­son­nel for fur­ther min­eral devel­op­ment.

“How­ever, this re­quires a very high level of pro­fes­sion­al­ism on the side of those who will be en­trusted to run the state-owned com­pany.

“It would also mean that the coun­try should be ready to forego some of the rev­enue from the sec­tor in the short-term in or­der to be able to en­joy the long-term benefits.”

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