Mining mogul Rautenbach to develop Zim's third largest platinum mine

Mining mogul Rautenbach to develop Zim's third largest platinum mine (Source: Mineweb)

African mining mogul Billy Rautenbach has a growing interest in Zimbabwe through proposed development of the nation’s third largest platinum mine, as well as the Hwange coal exploration venture.

Author: Tawanda Karombo, Mineweb
Posted: Tuesday , 09 Oct 2007


Controversial mining magnate and African investment mogul, Billy Rautenbach, is reported to have clinched a deal to develop a platinum mining project in Zimbabwe's Great Dyke region.

Sources close to the mining mogul confirmed that "should the deal materialize, it will become Zimbabwe's third largest platinum mine" after Zimplats and Mimosa.

Early indications are that Rautenbach - who counts Zimbabwe's President Robert Mugabe among his best friends - is understood to be negotiating a potential joint venture deal with a consortium of local businessmen who could control 30 percent of the investment.

The Zimbabwe Guardian reports that Rautenbach--who is a majority shareholder in the Democratic Republic of Congo's (DRC) state-owned Gecamines and also the Central African Mining and Exploration Company (CAMEC)--will pursue the project through Gecamines.

Sources told Mineweb that Gecamines, which has over the past few months increased its visibility in Zimbabwe, has always had an interest in entering the nation's mining sector. Although the deal is still under negotiation, Rautenbach is also courting a joint venture with local businessmen pursuant to the deal, possibly allowing locals to assume 30 percent control of the project.

A few weeks ago, Rautenbach struck a coal exploration deal with the beleaguered and underperforming Hwange Colliery Company, which signaled the mining magnate's arrival onto Zimbabwe's mining scene.

"Locals have been lined up to up 30 percent shareholding in the platinum mine," confirmed a source close to the developments. "The mine could be developed in Dyke Region, which is estimated to hold the largest platinum deposits the country."

The Zimbabwe Guardian reports that Rautenbach "met high-ranking government officials in August to discuss the deal". It is believed that it was during this meeting that the deal was given the nod, but finer details of the meeting nor of the deal still can not be obtained.

Barring the Zimbabwe government's resilient intentions - which were slammed by the country's central bank governor's push through Parliament legislation that would require all foreign-owned mining companies to cede 51 percent of their shareholding to locals - the country's mining sector has shown prospects of growth over the past two years.

Rautenbach's intent to develop the platinum project comes at a time when Implats-owned Zimplats has commissioned a US$258 million underground mine under phase one of the company's long-term expansion programme.

The Mining Amendments Bill and the Black Empowerment Bill, now before Parliament, require that locals hold 51 percent and 50 percent shareholdings in every project involving foreign investment.

Analysts and observers have marveled at the entry of Gecamines into the country's platinum mining sector at 70 percent shareholding. They say this development raises eyebrows since the new legislation restrict s foreign shareholding of companies to just 49 percent.

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