Kumba to be charged in rights dispute
Pretoria - The government will lay criminal charges against
Kumba Iron Ore [JSE:KIO] over its application for a mining right over the company’s
Sishen mine it did not yet own, a lawyer for the department of minerals
resources said on Wednesday.
Willie Vermeulen, a lawyer for the department, told the North
Gauteng High Court in Pretoria that more details on the charges would be provided
A Kumba spokesperson said the group - a unit of global miner
Anglo American [JSE:AGL] - would comment on the matter later.
The state's move is the latest twist in a tale that has
unnerved investors and led to allegations of graft and political favouritism in
the resource-rich country.
Shares in Kumba extended losses after the news and the stock
was trading 1.11% lower at R451.92.
Disputes over mineral rights have highlighted transparency
and governance issues after some had been awarded to people linked to
high-ranking officials, sometimes over areas that were already being mined.
The dispute in court, which is at the heart of an ongoing
battle between Kumba and the South African unit of steel giant ArcelorMittal SA
[JSE:ACL], could further unnerve mining companies in the top producing country
for platinum and ferrochrome and a major supplier of gold and iron ore.
Kumba has challenged the state's award of a prospecting
right over a stake in Kumba's Sishen mine to little-known yet politically
connected Imperial Crown Trading (ICT).
Kumba's allegations of fraud and corruption led last month
to an unprecedented raid of the minerals ministry by the Hawks, which analysts
interpreted as signalling serious flaws within a key government department.
Vermeulen said Kumba had tried to manipulate the system to
gain advantage by filing its application early, even before the the previous
holder's right had expired, and asking officials to change the date on its bid
so it would be considered first.
"What is this other than a resolution to mislead?"
he told the court.
This is a BIG one .... Zuma's son is involved ... Hence the governments 'swift' action ... This was what made them R9 BILLION in one day ..... This stinks of corruption!!!!
Wow super rich the government charging Kumba with fraud. Talk about diversion tactic. ICT are a corrupt bunch of government-backed heavies. They should all be charged in their personal capacities for fraud. And AMSA was just clearly sleeping behind the wheel when their rights lapsed. Why should Kumba have to sell its ore at a fraction above cost? They and their investors have every right to charge at market rates. If AMSA cant make money by buying ore at the prevailing rate, then they don't deserve to exist!
this is one battle that Kumba wont win because at the heart of this saga is the president's son.