Landela targets more Zim mining assets
FOLLOWING an aggressive 2019, Landela Mining Venture said investing in Zimbabwe's mining industry remains central to its overall strategy going forward. And the company is showing no loss of appetite for Zimbabwe's mining assets after its chief executive David Brown hinted to Business Weekly that the company would maintain the scale of investment whenever opportunities arise.
“We will invest in the (mining) assets to make Zimbabwe a mining giant. We will continue assessing every opportunity to create sustainable livelihoods going forward,” said Brown, who is former chief executive of Impala Platinum Holdings, the major shareholder of local platinum miner, Zimplats.
Its strategy bodes well for Government's ambitious vision of propelling the country's mining sector to a US$12 billion industry in the next three years, underpinned by investments in gold, platinum, diamonds and other strategic minerals.
The country is largely looking up to the mining sector to underpin the revival of the economy grappling with foreign currency shortages, low industrial output, high unemployment and spiralling inflation.
“In the past one and half years, Landela has become a household name on Zimbabwe mining landscape and this will probably make it the country's, if not the biggest investor in the next few years,” said Jacob Murefu, a commodity analyst with a local research firm.
Landela has been on a buying spree of mining assets, both owned by the Government and the private sector.
Recently, the company concluded the takeover of gold mines owned by the Government through the Zimbabwe Mining Development Corporation (ZMDC).
ZMDC, the state owned mining entity had been looking for investors for the mines, which include Elvington, Sabi, Golden Kopje and Jena for more than a decade, but there were no takers. In 2008, ZMDC publicly invited the tenders but again there was no immediate response.
Landela took over Shamva gold mine previously owned by Mzi Khumalo's Metallon Corporation.
Shamva Mine has since reopened and the company is now focusing on ramping up production. Metallon suspended operations at three of its mines including Shamva and Mazowe last year due to mounting debts estimated at US$200 million. Negotiations for other Metallon's mines are underway. Landela is also a major shareholder in a multi-billion-dollar platinum project, Great Dyke Investments and in Bindura Nickel Corporation, a listed entity on the Zimbabwe Stock Exchange.
This week, Brown said Landela was expecting to conclude negotiations for Sandawana emerald mine “in a month's time”.
“The acquisitions are part of our broader vision to make Zimbabwe a mining giant. So in addition to our portfolio which include gold, nickel and platinum, we would also like to add the gemstones,” Brown said.
Sandawana has been an important producer of emeralds for 40 years before production was suspended in 2011 due to loss of some traditional markets.
Landela is owned by Sotic, a Mauritius based investment company. It has been previously linked to businessman Kudakwashe Tagwirei but he has denied any links.
Already, the mining sector is the country's largest foreign currency earner, accounting for nearly 70 percent of export receipts. Gold is Zimbabwe's largest foreign currency earner.
The sector also remains one of the key industries expected to anchor the revival of an economy suffering from depressed productivity and foreign currency shortages among others. Under the US$12 billion mining roadmap, gold is expected to contribute US$4 billion, platinum US$3 billion while chrome, iron, steel diamonds and coal will contribute US$1 billion.
Lithium is expected to contribute US$500 million while other minerals will contribute US$1,5 billion.
President Mnangagwa's administration remains optimistic that the US$12 billion target is achievable and would help propel his vision of an upper middle-income status by 2030.
“Our desire is to achieve higher middle income status by 2030. No doubt we will achieve the vision we have set but this won't be achieved by mining alone but all sectors,” President Mnangagwa said last week while touring coal mines in Hwange.