Hello Vaughn:
From the Financial Post:
Tuesday, September 29, 1998
South African accusation angers SouthernEra
By PETER KUITENBROUWER
The Financial Post
A bitter exchange after a gathering of mining investors has raised questions about a promise by the government of South
Africa to roll out the red carpet for Canadian mining firms.
The flareup over diamond mining came after top South African mining officials told a gathering in Toronto Friday that
changes approved last week by that country's cabinet will ease foreign investment.
"There are many opportunities," said Nchacka Moloi, South Africa's chief director of minerals promotion. "If you want to be
a global player, you have to be in South Africa."
Jan Bredell, South Africa's deputy director-general of mineral development, said a new law will force mineral-rights owners
to allow mining on their land. "We're taking the veto rights of tenants out of the equation," he said. "The state will determine
internationally competitive royalties" to be paid to the tenant.
Bredell said the change, set to become law within a year, means brawls over mineral rights like this year's fight between
SouthernEra Resources Ltd. and De Beers Consolidated Mines Ltd. won't happen.
The dispute arose after heirs popped up to claim a diamond cache uncovered by SouthernEra. The Canadian firm ended up
with 40% and De Beers 60% of the diamonds.
But after Friday's meeting, Bredell sparked fireworks when he said SouthernEra's errors, not problems with his country's
laws, had been at the root of the firm's hardships.
"They went ahead and announced the results," he said. "If they had applied for cession before they announced, they would
have been OK."
Kim Freeman, vice-president of SouthernEra, said new state powers to give out mining permits will be useful only if the
government learns to move more quickly.
"Our application [to mine on one section of the deposit that is state-owned] has been in for three years. That's why I get a bit
bitter and twisted when I talk to this guy," he said.
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Regards. Goalie. |
