TerraLex Cross-Border Guide to Cross-Border Guide to Mining Rights

The mining sector in Zimbabwe is regulated by the Ministry of Mines, The Environmental Management Agency, The Minerals Marketing Corporation of Zimbabwe Act (Exporters) and the Zimbabwe Investment Authority (Foreign Direct Investors). The main laws that may have a bearing on anyone mining in Zimbabwe are:

• Base Minerals Export Control Act (Chapter 21:01)
• Companies Act [Chapter 24:03] -Environmental Management Act [Chapter 20:27]
• Electricity Act [Chapter 13:19]
• Exchange Control Act [Chapter 22:05]
• Forest Act [Chapter 19:05]
• Joint Ventures Act [Chapter 22:22]
• Labour Act [Chapter 28:01]
• Mine and Minerals Act [Chapter 21:05]
• Minerals Marketing Corporation of Zimbabwe Act [Chapter 21:04]
• Precious Stones Trade Act [Chapter 21:06]
• Special Economic Zones Act [Chapter 14:34]
• Water Act [Chapter 20:22]
• Zimbabwe Investment Authority Act [Chapter 14:30]

List: - The Ministry of Mines

• The Zimbabwe Investment Authority
• The Minerals Marketing Corporation of Zimbabwe
• The Environmental Management Agency
• The Zimbabwe Water Authority

Mining and prospecting rights in Zimbabwe are not only limited to concessions, but are awarded under Zimbabwean law and may take the form of: An Exclusive Prospecting Order (EPO) which allows exploration over a large area and restricts others from pegging (registering rights) within the EPO area for the duration of the EPO award, usually years. Previous rights holders before an EPO issue are not affected even if EPO is over their mining titles. The holder of the EPO has a licence to explore and register mining titles over any areas within their EPO that they find economic deposits they wish to exploit.

A Concession which gives the right to mine over large areas of land, usually in the 0000s of hectares. This has a use it or lose it policy.

A Special Grant (mining lease) which is issued for large areas to mine, where it would not be economical to have many mining titles due to the size of areas, usually 00s-000s of hectares. These are for a fixed period (years) and must be renewed at the expiration of the Special Grant.

A Mining title is usually 50 hectares a block for a base metal and 10 hectares a block for precious metals. These are for life and are demarcated by beacons installed by registered peggers.

A general guideline of the stages is:

1. Setting up of a company.
2. Registering for taxes, opening bank accounts, looking for areas to mine that are open.
3. Registering your business plan and investment with relevant authorities
4. Applying and acquiring of rights.
5. Completing all steps required to be granted the rights.
6. Beginning the process of mining.

List: 1. Need for at least One Zimbabwean Director for the company seeking the mining rights. 2. Police Clearance, identity documents and tax clearance for all directors of company applying for rights. 3. Well drafted application with the requisite fees for licence/s sought. Fees dictated by type of mineral and size of area being applied for. 4. Lodging of documents at the relevant Ministry of Mines for the specific province where mining will take place.

After being granted a prospecting licence - exploration and land rehabilitation are done in tandem. An environmental licence is also needed which is granted by the Environmental Management Agency. The licence will detail any restrictions if any.

List: 1. Working within the boundaries set out by the Environmental Agency. 2. Keeping mining licences and results up to date with the Ministry (annually). Failure of which can result in licences 3. being cancelled or forfeited back to the Ministry of Mines. 4. Respecting the community and involving them by either improving the area and or hiring local workforces. 5. Land rehabilitation after mining exploitation/production.

List: 1. Land rehabilitation of which the estimated cost is approved by the Environmental Agency before mining activities begin. 2. For any minerals exported a royalty is paid to the Minerals Marketing Corporation of Zimbabwe. Some minerals have a minimum threshold of beneficiation before they can be exported and/or minimum prices they can be sold for to the world market (dependent on the current world prices). 3. Some base minerals cannot be exported in raw form, they must be beneficiated up-to required thresholds before export, like Granite, Chrome, Lithium.

Can be done in a straightforward manner with the aid of a legal firm.

List: 1. The relevant authorities must approve it. 2. In some cases, a joint venture with a public body is a requirement for monitoring processes.

Land rehabilitation and community focused corporate social responsibility for the areas that have been mined. Failure to follow your environmental licence requirements can result in mining activities being shut down and heavy penalties.

List: 1. Environmental Prospectus must be drafted detailing proposed mining plan, plant design, estimated project cost and rehabilitation plan. 2. Environmental Impact Assessment done by registered person/s of the Environmental management Agency. 3. Licence issued for 2 years, then renewable annually after the initial period.

No mining activities within 200 meters of any water body. Sourcing of water from dam can be done if authorised (Water Act [Chapter 20:22]) Alluvial mining is also banned in Zimbabwe.

The requirement for an Indigenous person to own at least 51% of a mining company is no longer a requirement. Foreigners can own 100% of a mining company but at least one director must be a Zimbabwean resident.

There are a number of local companies sitting on great deposits but lack the financial capacity to realise full scale mining. These companies are open to joint ventures.

Gold mining and production has grown by 300% over the last 3 years.

Lithium at a good grade can be found all over the country.

Many minerals are being found in good economical deposits like: Coal, Platinum Group Metals, Diamonds, Chrome, Granite, Copper, Iron, Manganese and are open to investment.

Zimbabwe will be one of the biggest suppliers of Lithium in the world market by virtue of having the sixth largest reserves known with much more scope for further exploration.