Daniel Nemukuyu Harare Bureau
MBADA Diamonds – one of nine companies evicted from Chiadzwa by the government last week — yesterday won a temporary reprieve allowing it to return to its mine pending a High Court hearing tomorrow. The government last night said it would fight to reclaim the rich diamond deposits, accusing the mining firms of wanton plunder.
An order won by Mbada Diamonds, which was a 50-50 joint venture between Mauritius-registered Grandwell Holdings and the government-owned Marange Resources, allows the company’s security guards “full access to the mining site, full access to all the relevant premises thereat, including residential premises; full access to all the equipment, diamond ore, and any other assets belonging to Mbada Diamonds”.
The government ordered all diamond mining companies off the Chiadzwa fields after they defied a policy directive to merge into a single company called the Zimbabwe Consolidated Diamond Company (ZCDC).
Mbada, along with nine other firms, was given 90 days to remove its equipment and other assets from the site.
Grandwell Holdings chairman David Kassel said the government directive stopping the miners’ operations was “unlawful”.
“… the government respondents have embarked upon an unlawful scheme which is designed to facilitate the nationalisation and or expropriation of Mbada’s assets,” he said in an affidavit.
The government accused Mbada of failing to renew a special grant, which was now the basis for its eviction.
But Grandwell argues that its joint venture partner, Marange Resources, a government company, undertook to do the renewal of the grants among other warranties as part of the shareholding agreement.
Part of the Principal Agreement signed between the two companies states: “Marange Resources undertakes that it shall forthwith after the signature date and thereafter for the duration of this agreement-
“Pay all necessary fees and make application for the renewal and or continued existence and of all that may be necessary so as to ensure that the special grants and rights thereunder are in good standing and remain valid for the duration of this agreement allowing Marange to mine and prospect the concession areas in perpetuity.”
Grandwell argues that the government, through Marange Resources, undertook to protect the rights of the foreign investor and to “observe the utmost good faith and not do or omit to do anything which might prejudice or detract from the rights or interests” of the foreign investor.
The company argued that government had wilfully and with malice, breached its obligations and undertakings.
Kassel said Mbada, over the existence period of the joint venture agreement, paid $472 million to Treasury, a figure which will drop to zero if the company’s operations are permanently shut down.
Last night, Mines Minister Walter Chidhakwa said he had instructed the Attorney General’s office to appeal the High Court order granted in Mbada’s favour ahead of a more substantive hearing into Mbada’s court challenge tomorrow.
“We’ve instructed the Attorney General’s office to look into the matter and file an appeal. Maybe tomorrow [today] we’ll be filing the appeal,” Chidhakwa told ZiFM.
Justice Joseph Mafusire issued the court order yesterday after postponing the urgent chamber application by Grandwell Holdings to tomorrow (Wednesday).