Why Platinum Miners Flock to Zimbabwe
Source: International Business Times, Geena Paul (7/12/10)
"Zimbabwe is second only to S. Africa in E&P opportunities."
Zimbabwe is witnessing a revival in its mining sector, with major companies committing to a number of significant platinum projects. And, if Zimbabwe decides to tap its mining resources properly, the country will be on way to high growth.
New mining investment in Zimbabwe is growing fast despite investor concerns about impending indigenization legislation.
Again, President Robert Mugabe has told mining company executives that his government had no intention to expropriate the mining industry. This has resulted in several mining firms flocking to the country.
The country has long been an attractive target as it contains the world's second-largest deposit of PGMs in the Great Dyke Formation, which stretches about 550km.
Zimbabwe made more than $500 million from mineral sales during the first five months of the year. The country's income from the sale of 16 out of 36 minerals amounted to $511 million.
The metals sold during the period include platinum, gold, limestone, high carbon ferrochrome, coal, asbestos, chrome, cobalt and copper.
Leading the list of minerals contributing to the national mineral value was platinum, which contributed $168 million, followed by gold with $117 million.
The country produced 3,628 kg of platinum from January to May.
Zimbabwe is second only to South Africa, where all major mining companies have several operations, in terms of the exploration and production opportunities it boasts.
The view that indigenization legislation may be softened in the country was supported by recent announcements about capital commitments by significant players in the mining industry.