Zim's Supreme Court backs Mpofu, Essar Holdings

HARARE - Zimbabwe's Supreme Court has backed Mines minister Obert Mpofu’s move to cancel Bearable Prospects (Bearable)’s claim to the Mwanesi iron ore reserves, which were given to Essar Africa Holdings Limited (Essar).

By dismissing Rodrick Mumbire’s appeal this week, Deputy Chief Justice Luke Malaba has effectively facilitated the conclusion of the Mauritian-based resources group’s $750 million acquisition of the Zimbabwe Iron and Steel Company (Zisco), now NewZim Steel.

“In light of the publication of government gazette, Vol XC No 60, general notice 484 of 2012 dated October 26, 2012 cancelling the claims in dispute, the appeal is hereby withdrawn,” he said, adding the parties (Bearable and defendants) would meet their own costs.

In the hard-hitting ruling, Malaba — sitting with Annie-Mary Gowora and Yunus Omerjee — not only declined to make an “academic judgment”, but also noted that the October 2012 gazetting of the cancellation of the claims was final in the circumstances.

The decision came after the court upheld the defendants’ counsel Addinngton Chinake, a senior partner at Kanter & Immerman's argument that the matter had been effectively settled by Mpfou's decision, which the appellant's lawyer Advocate Lewis Uriri concurred with.

While ex-Zisco employee Mumbire has claimed ownership of a significant part of the 41 000 hectare-Mwanesi resource base, government had given the coveted asset to Essar as part of the Indian-backed investor’s deal with the Midlands-based steelmaker.

After Bearable had learnt of this development, it made a successful High Court appeal last year, which further delayed the Essar-NewZim Steel transaction.

Last year, Industry minister Welshman Ncube — the main driver of the Essar deal — said the dispute over the Mwanesi claims, along other hurdles, was withholding the implementation of the multi-million dollar deal.

“It was agreed that we will transfer Buchwa, Ripple Creek and 20 claims in Mwenezi that are not in dispute to NewZim Steel. We will wait for the Supreme Court ruling on who is entitled to the other claims that Mumbire has,” Ncube said.

“If the court says the claims belong to Mumbire, we will give them to him. We don’t believe the Supreme Court will so rule,” Ncube added.

On Wednesday, Ncube referred questions on the latest court outcome to Mpofu’s ministry, but the latter’s deputy Gift Chimanikire also said he was yet to be “formally briefed” on the matter.

Last year, Chimanikire said the High Court had based its findings on a Mines and Minerals Act clause stipulating that claims not opposed within two years of being awarded could not be challenged.

“The judge erred because that clause refers to unexplored areas, but that was a reserved area. It is government property,” he was quoted as saying.

With the foreign-backed Essar acquiring a 54 percent stake in the former Zisco, it also undertook to take over the once State-owned company’s debts totalling $400 million and in return for other concessions. - Eric Chiriga, Business Editor

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