Zimbabwe Parliament suggests giving mining companies time to develop before beneficiation


0

Zimbabwe’s legislators have suggested that the government should give mining companies between seven and 10 years to develop their operations before penalizing them for continuing to sell ore.

Presenting recommendations by the Parliamentary Portfolio Committee on Mines and Energy for the 2018 budget, chair Fani Munengami said the current framework in which the government seemed to be expecting accompany  to simultaneously invest in mining development, set up smelter facilities, install base metal refineries as well as installing the precious metal refinery before commencing all extraction appeared  not only as punitive but also impossible as investors need time to recover their capital before reinvesting it to the next stage of the value chain.

He said  the beneficiation tax framework must be improved by granting investors some tax break or tax holidays between each stage of the beneficiation value chain to allow them time to recover committed capital so that they can reinvest into the next stage of the beneficiation value chain.

“As a committee we propose the following period breaks for the beneficiation tax framework.

  • Mine Development – 7 to 10 years, depending on the nature of the project. The time frame must be sufficient enough for the company to develop mine and build sufficient feed stock for beneficiation.
  • Smelter facility – 7 to 10 years, depending on the nature of the project. This period covers construction of the smelter of at least two years and five to seven years to recoup invested capital
  • Base metal refinery – 7 to 10 years also. The time frame covers a minimum of two years for construction of the BMR and five to seven years to recoup invested capital. It is further proposed that individual company’s unique circumstances such as the life of the mine and size of the assets must be carefully weighed into the time line considerations. We are also imploring the Government and platinum producers to agree on a precious metal tour treatment facility for Zimbabwe as in the case of Fidelity Printers and Refineries Gold Processing. This would reduce burdened platinum producers and ensure huge capital savings that can be deployed in developing new mines and create more jobs.

 

Continued next page

(77 VIEWS)

Don't be shellfish... Please SHAREShare on Google+
Google+
Tweet about this on Twitter
Twitter
Share on Facebook
Facebook
Share on LinkedIn
Linkedin
Email this to someone
email
Print this page
Print

Like it? Share with your friends!

0
The Insider

The Insider is a political and business bulletin about Zimbabwe, edited by Charles Rukuni. Founded in 1990, it was a printed 12-page subscription only newsletter until 2003 when Zimbabwe's hyper-inflation made it impossible to continue printing.

0 Comments

Your email address will not be published. Required fields are marked *