INDIAN firm Essar recently sought clarification from government on whether it would transfer iron ore claims necessary for the finalisation of the takeover of troubled steelmaker, Zisco. The move by Essar came after Mines and Mining Development deputy minister, Gift Chimanikire was quoted by state media as saying the ministry did not want Essar to have a monopoly over claims and that indigenous players had shown an interest in the claims.
Mr Chimanikire was quoted as saying that "We don't want to create a monopoly by giving all the claims to one company. We have to allow other players, for instance, indigenous players should also be able to explore the ore."
"Already we have been approached by two new indigenous companies who are interested in smelting iron ore in Chivhu and Mvuma. They have very viable proposals. They have good partnership proposals."
Industry and Commerce minister Welshman Ncube said Essar had resolved that it would come back and work but were disturbed by Chimanikire's statements. He said that "They asked for reconfirmation about the Cabinet decision of September 9. We have given them that reconfirmation. We told them this [last] week."
In September, Cabinet resolved that iron ore claims in Mwanezi should be transferred to New Zim Minerals as the final stretch towards the revival of the former Zisco.
Mr Ncube said mixed signals from government about the deal were to blame when Essar stopped paying workers' salaries in March arguing that it would only proceed once the transaction was finalised. He said that "When Essar stopped paying salaries, it was Chimanikire who had issued statements. When we are about to start he [Chimanikire] issued a similar statement that the Ministry of Mines will not abide by a cabinet decision."
After announcing a USD 750 million investment into Zisco last year, Essar has been finding it difficult to conclude the deal due to bureaucracy in government over the transfer of iron claims to NZM. The claims are at Bimco, Ripple Creek and Mwanezi.