Mine case cites Gwede
‘Nephew’ claim as court told Gwede gave go-ahead to Chinese ‘irregularly’
● A man said to be claiming he is the nephew of Gwede Mantashe has been accused of dropping the mineral resources minister’s name in an attempt to bolster his claim to a 26% BEE stake in a lucrative mining project.
Community leaders told the Sunday Times that the man, Vuyani Gaga — who is facing fraud and corruption charges relating to a R600m toilet-building scandal in the Eastern Cape — was present when a mineowners’ delegation met community leaders in Limpopo last year.
His presence at the meetings is being cited in a bitter Pretoria high court battle involving Chinese-owned Nkwe Platinum and its long-time local empowerment partner, Genorah Resources, over the mining rights.
On Friday Mantashe described any dropping of his name as “mischievous”, saying Gaga, 36, “is not related to me”. “Vuyani … is Tshawe, uMdange kaTshiwo, and I am uMqwathi. I don’t have a relative married to the Gaga family, and he has no relative married to the Mantashe family.”
Mantashe also accused the Sunday Times of bringing him into the matter to tarnish his reputation.
The minister is accused by one of the warring parties of “irregularly” giving Nkwe the go-ahead to mine part of Garatouw farms, near Burgersfort in Limpopo. The land’s precious metal resources are estimated at 23-million ounces, including platinum, palladium and rhodium worth billions of rands.
Genorah CEO Maredi Mphahlele alluded in court papers to a possible conflict of interest, as Gaga is said to be aligned to Nkwe and to have received payments from it through Omarocube, a company of which he was a director.
In November last year, in the middle of the court battle, Mantashe granted Nkwe the rights to start mining the land from June 14 this year.
Mantashe was drawn into the fight after Mphahlele claimed in his affidavit that Gaga, through Omarocube, was a consultant to Nkwe.
“On 8 September 2020, [Genorah director Mokganyetsi] Sithole had a telephonic discussion with [Mantashe] to raise Gaga’s involvement in the Garatouw Mining Project and the possible conflict of interest that exists considering the position of authority occupied by [Mantashe] within the [department of mineral resources & energy],” Mphahlele said in his affidavit.
“[Mantashe] was of the view that Gaga was free to conduct business with whoever he wanted and was adamant that no conflict of interest existed.”
In an interview with the Sunday Times, Mantashe denied there is any conflict. The Sunday Times pointed out to him that Gaga is a co-director of a separate company, Siphamba Consulting, with Mantashe’s wife, Nolwandle. Mantashe declared his wife’s interest in Siphamba in the parliamentary register of members’ interests in 2018.
“If he’s a director of Siphamba Consulting, is Siphamba involved in the work there?” Mantashe responded. “Conflict does not happen just because you know someone. You declare a conflict of interest when that relationship is involved in an activity.”
The Sunday Times has seen proof of a number of payments from Nkwe to Omarocube’s First National Bank account amounting to more than R1.1m between October and December last year.
Company records show Gaga was the sole director of Omarocube from its establishment in 2017 until March 23 last year, the day he resigned and was replaced by a relative, a 24-year-old college student.
Gaga’s involvement in the Garatouw mining project was confirmed by community leaders who allege that he, alongside Nkwe CEO Gary Fan and former public enterprises director-general Richard Seleke, was part of a series of community meetings to discuss it. Two community leaders who attended the two meetings, held on July 4 and August 1 last year at the Fusion boutique hotel in Polokwane, told the Sunday Times that Gaga introduced himself as Mantashe’s nephew and one of Nkwe’s BEE partners.
“We met Richard, the China guy who they say is the CEO, and then this guy Vuyani Gaga … they say he is Gwede’s nephew in Polokwane,” said one.
“They told us that Nkwe wants to talk to the communities directly, and the chiefs, and that they need our assistance. What I did not understand was what Gwede’s nephew was doing there. He mentioned that there is 26% available and that the Chinese were willing to buy those shares for the community. He was also mentioning his uncle’s name every time he spoke.”
The community leader, who asked not to be named for fear of reprisals, added: “Even if there were battles between Genorah and Nkwe, why was Gwede’s nephew being part of this? Also, why should we as locals be asking somebody from the Eastern Cape for opportunities which are here?
“I even asked Seleke if Vuyani Gaga was part of Nkwe and he never answered me.”
Another community member confirmed the Polokwane meetings and also said Seleke, Fan and Gaga were present.
Mphahlele said in court papers that these meetings confirm Genorah’s suspicions that the Chinese are seeking new BEE partners and that Gaga is positioning himself for that.
Numerous attempts to contact Gaga were unsuccessful, with all of his listed numbers going to voicemail. His family members and associates said he had changed his number and they promised to relay a message to him. One relative said Gaga refused her permission to pass on his phone number.
Seleke, who left the department of public enterprises after allegations that he helped the Gupta family loot Transnet in the R5.2bn China South Rail locomotives tender, confirmed he was a consultant for Nkwe but said he had never met community members in Gaga’s presence.
“I have no knowledge of such meetings, the only meetings I know of are official meetings with the chiefs. It was me and Gary Fan and they are recorded and formally minuted. There was no Vuyani Gaga in those meetings I know about,” he said.
“I wouldn’t know why people would claim that I had a meeting with them when I didn’t. We were engaged in negotiations with the chiefs for surface lease agreements including co-operations. As a consultant I am part and parcel of the company and speak on the CEO’s behalf.”
Asked whether he had met Gaga, he said: “I do not want to deny that I may have met someone.”
In one of the recorded meetings, Seleke told community members that once Nkwe’s mining operations began there would be plenty of opportunities for locals.
The fight between Genorah and Nkwe began when Nkwe merged with a subsidiary of its majority owner, Chinese listed company Zijin. It formed a company, also called Nkwe, which is registered in Bermuda.
The new company is claiming its predecessor’s mining right, despite the fact that the transfer was not approved by the minister, as required by South African law.
In terms of section 11 of the Mineral and Petroleum Resources Development Act, a transfer or sale of mining rights needs ministerial approval.
Nkwe argues it did not need these approvals because according to Bermuda law, the amalgamation did not mean the cessation of the old company’s rights, Fan said in court papers. Fan did not address questions the Sunday Times put to him, but said: “Nkwe specifically denies strongly the direct or indirect allegations that it has acted irregularly or unlawfully in any way relating to the matters raised in your e-mail. All of Nkwe’s rights are fully reserved.”
Genorah and the old Nkwe owned 26% and 74% respectively of the Garatouw mining right awarded in 2014.
Despite the court battle that began last August, Mantashe issued the new Nkwe, which is 100% owned by the Chinese, with a letter permitting them to carry out mining operations. The letter, which the Sunday Times has seen, appears to be a response to a November 2019 application by Genorah and Nkwe for an extension of commencement of mining operations until June 2021.
It is unclear why Mantashe issued a letter authorising Nkwe to start mining in June.
Mantashe said many officials are involved in any letters he signs. “You will find letters with my signature all over the place,” he said. “When I sign, the matter has been through a long process from the region to various layers within the department. But if a person has a query there is an appeal process, they don’t appeal through the Sunday Times.”
The mineral resources department said it is aware of litigation in which Genorah is seeking declaratory orders about the transfer of shares in the mining right. “No relief is sought against the minister, who abides by the decision of the court,” it said.
Mphahlele said he and Genorah believe the registration of a new Nkwe with the same name and registration number as its predecessor was a way to deceptively house the mining right in a company over which only the Chinese have control.