1 February 2013

Zimbabwe: Renco Saga Spills Into High Court

Photo: Rio Zim
Renco mine in Zimbabwe

DIVERSIFIED resource firm RioZim Limited says it has filed a High Court application seeking to restore normalcy at its Masvingo-based gold mine, Renco. This has come at a time when Government, through the Ministry of Youth Development, Indigenisation and Empowerment, has deployed an investigation team led by police Senior Assistant Commissioner Silence Pondo to probe the disturbances.

About 3 000 workers are at loggerheads with their employer over poor working conditions. Last week, they staged a demonstration demanding better wages. Villagers in surrounding communities are also calling on Government to the indigenise the mine.

RioZim, which is listed on the Zimbabwe Stock Exchange, said while the company was operating, it was being prevented from managing and "exercising control of its assets".

"This has a significant negative impact on the cashflows of the company," said RioZim in a statement yesterday.

"Every effort is being made to ensure the safety of the employees at Renco Mine and to protect the environment in the vicinity of the operations, given the nature of the chemicals used in the processing of gold."

Apart from the seeking legal recourse, RioZim said it would pursue "other avenues to seek prompt resolution", but was not specific on other alternatives.

Minister Kasukuwere said he was concerned over the disturbances at Renco Mine, saying such actions would drag the indigenisation policy "into the mud".

"We have deployed an investigative team consisting of police and some ministry officials because this (also) has to do with law and order since there are now elements claiming ownership of the mine," said Minister Kasukuwere.

Last year, RioZim had projected gold production at its Renco Mine would jump 25 percent to 100kg in the first quarter of 2013, due to development work at the mine.

RioZim's assets are made up of Renco, the Empress Nickel Refinery, Sengwa Colliery and several exploration claims, including a 22 percent stake in Murowa Diamonds.

Last year, RioZim completed a private placement of ordinary shares worth US$6,6 million to Raintree Investments, a rights offer of US$5 million and issue of convertible debentures to GEM Raintree in March.

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