Namibian miner courts Murowa boss

HARARE - Namibia's largest uranium mine, Rossing, is reportedly targeting Murowa Diamonds (Murowa) managing director Zebra Kasete to take up a senior position at the company, businessdaily has learnt.

Kasete once worked at Rio Tinto’s Namibia unit since 1987 and rose through the ranks to become general manager corporate services before he was appointed to head Murowa in 2011.

However, his future at Murowa — which early last year temporarily closed down to reflect on high taxes and fees — is in doubt following pressure from government on the junior resources firm to participate in a forced merger of diamond companies.

When contacted for comment, the mining executive, with over 26 years’ experience in the industry, was evasive and could not elaborate on his future plans.

Kasete said he knew Rossing because that is where he came from but had “no comment” on current reports linking him with a return to Namibia.

Murowa, in which the international resources group Rio Tinto Plc sold its 78 percent shareholding to new investors mid last year, had been crippled by hostile government policies and was battling to remain afloat.

Amid pressure from softening international mineral prices that have rocked the market in 2015, Murowa had pleaded with government to review a range of taxes and fees charged on mines to give the industry breathing space.

Instead, government responded by hiking royalty rates for chrome miners, demonstrating that it was not prepared to give concessions to an industry long suspected of externalising its income, although government has failed to back its accusations with evidence.

“The associate, Murowa Diamonds (Private) Limited in which RioZim has a 22 percent interest, incurred a loss,” RioZim announced in a note to shareholders and other stakeholders in the half year to June 2015.

“The group recorded a share of the loss of $573 000 from a profit of $414 000 in June 2014.

There is no significant mining that was done in the first half of the year at this operation. Murowa Diamonds (Private) Limited finalised its mine plan subsequent to the reporting period and operations will commence in the fourth quarter after nine months of stoppage, but losses are expected to continue into 2016,” RioZim said.

In February last year, Murowa warned that fees and tax hikes slapped on the mining industry in the past few years would have serious implications on its going concern status.

Murowa said it had its best production in 2014, with total material mined, at 5,1 metric tonnes, setting a new record and “demonstrating our capacity to deliver on our promise”.

But in an address to staff on January 26, Kasete said the mine, based in Zvishavane, faced a gloomy future as taxes continued to pile pressure on revenues and profitability.

“The business is facing formidable challenges, which could have serious implications for our operation. The government has slated a regime of taxes that include ground rental fees, which are weighing down the business,” he told workers.

“The management team is continuously engaging government and hopes for some positive outcome from this process; else the viability of Murowa Diamonds as a going concern will be impacted. Employees will continuously be updated on any changes resulting from this outcome,” Kasete added.

Subsequently, Rio Tinto Plc, the world’s second largest resources firm which held a controlling stake in the diamond operation, announced its exit after selling its shareholding in diamond and coal assets. Indian investors were reported to have taken over control of Murowa.

Comments (2)

The regime of taxes is meant to cater for our God - given hard working people's CABINET, which is the smallest by world standards given our vibrant economy. Thanks to the ZimASSET,

Mukanya - 13 January 2016

Zebra came from Rossing and was seconded to Murowa when it was still under RioTinto. robably with his secondment contract coming to an end, plus change of ownership...its only natural that he goes back to the company that seconded him to Zimbabwe. Nothing special or unexpected about it.

Bro Fidza - 15 January 2016

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