While many Namibians are pushing for increased ownership of the country’s natural resources, the Chamber of Mines yesterday said it vehemently opposed to the notion.
The chamber’s outgoing president, Hilifa Mbako, at their annual general meeting said increased local ownership will stifle exploration activities.
Mbako yesterday said the chamber opposes the introduction of a mandatory 15% shareholding ownership retention by Namibians upon transfer or sale of their existing EPLs as announced by the mines ministry on 2 March 2021.
“The policy would disincentivise exploration by Namibian and foreign investors. The resulting effective 15% free carry on EPLs, held by Namibian entities, makes them unattractive for investors to carry this burden without proportionate local financial contributions to fund exploration expenditure,” lamented Mbako while delivering the 2022 report at the chamber’s annual general meeting in Windhoek.
He said investors will shy away from such transactions, resulting in unintended backlash and thereby defeating the very essence of the intended empowerment.
Further, he noted despite many attempts at consultations and engagements with the minister in 2022, the chamber could not come to a common position on the matter – and the 15% ownership retention was subsequently accepted by the industry.
The statement shocked National Union of Namibian Workers (NUNW) acting president Phillip Munenguni.
In his view, the 15% is not even sufficient, saying Namibia should benefit from her resources and not sell it cheaply.
According to him, if investors are against the Namibian policies, they should go and find what they want elsewhere.
“We rarely find genuine investors. Look at B2Gold; they made profits and now they are packing up. Namibia did not even benefit anything from her own gold,” said Munenguni.
Further, the company has made a killing. In the past nine years, they sold gold worth N$25 billion.
Between 2019 to 2021, B2Gold made a profit of about N$5 billion.
Empower workers
Meanwhile, Otavi councillor George Garab has strongly advocated for mine workers to be offered a percentage of shares in operational mines throughout Namibia to guarantee workers’ ownership of the mining sector.
This, he said, will ensure mine workers are properly looked after and not dumped on the streets when mines shut down.
This arrangement would mean if the company makes profits and dividends that are declared, an employee will also benefit from dividends that will accrue to the employee’s trust.
Garab’s comments follow the announcement of the phased closure of the Otjikoto mine, managed by B2Gold near Otavi.
The company did not say how many of the 942 permanent employees would be affected, saying job cuts would be determined by the ramp-down schedule.
Economically viable operations at Otjikoto, which includes low-grade stock processing, are projected to end in 2031. Open-pit viability is projected to end in 2024, with output dropping to 50% of production capacity.
“It is disturbing for one to read on social media that B2Gold profited so many billions of dollars out of our natural resources but did not contribute anything significant towards the Otavi community and Otjozondjupa region at large. They don’t have any mercy for Namibians.
“They are mining our natural resources and doing all services themselves without thinking of value addition towards the locals and skills transfer to their
employees.
The economy can be negatively affected when mining operations come to a standstill and/or shut down. Most importantly, workers are losing their jobs,” charged Garab in the National Council while debating the mines and energy ministry’s budget.
Late last year, the Kombat Mine in Garab’s constituency unceremoniously stopped operations, leaving 200 workers on the
street.
Garab said ownership of different mines is dominated by foreign companies, who mainly extract and export such minerals to external markets, adding ownership of all mines combined is skewed more towards foreign (88.1%) than Namibian (11.9%).
Garab also argued the mining sector has not done enough in terms of value addition locally.
According to him, when B2Gold arrived in Namibia, they consulted community members regularly by conducting community meetings within community halls obviously because they were in the process of applying for an environmental impact assessment clearance certificate.
He said when mine owners achieve what they wanted, they deliberately forget the promises made to the community and distanced themselves from Otavi completely.
Although mines are supposed to ploughing back in different types of community projects; for example, building schools, hospitals and community centres, he feels these mines do not leave a lasting benefit for communities.
“Initially, B2Gold promised to build a state-of-the-art primary school in Otavi and it did not materialise. We are applauding the government for building the state-of-the-art primary school, which is near completion in Otavi. These mines don’t empower Namibians in the true sense. For example, mines don’t outsource engineering, maintenance and security services,” Garab noted.
Mining accounts for roughly 10% of Namibia’s GDP.
Halt
Namibia Local Business Association (NALOBA) also expressed shock about the imminent closure of the Otjikoto mine, managed by B2Gold.
“An economically viable operational mine cannot come to a screeching halt as if one is closing a shebeen. This message has sent shockwaves throughout the whole country. NALOBA would also like to express its dismay and utter disappointment at the imminent and sudden closure of the B2Gold mine in Namibia. It is a clear fact that foreign investors do not have respect for the laws of the country and for the employees in general. This is very unacceptable and unprofessional, and NALOBA would like to strongly condemn the management of B2 Gold for their would-be actions,” said NALOBA secretary general Sackeu Namuhuya.
NALOBA is of the opinion that if mining operations are to be terminated, it should be done in an orderly manner – and that same should be done according to the B2 Gold mine policy.
It proposes a signed copy of the contract should be provided to the public, inclusive of an indication of the lifespan of the mine and the mine’s phased closure plan.
NALOBA called on President Hage Geingob to establish an urgent commission of inquiry into the sudden closure of the B2Gold mine, and simultaneously investigate the conditions and contracts of all other mining operations.
The union requested the government to start involving stakeholders in the mining operations, such as unions, business associations and employers’ federations in all contractual agreements to avoid a repetition of such.
From a social development front, NALOBA stated it is notable that Otavi remains a ghost town even after having harboured such a lucrative mine.
“B2Gold has nothing to show in terms of its contribution to infrastructural development in Otavi. Otavi has not benefitted from the presence of the mine. One would have thought that the presence of a gold mine in Otavi would be demonstrated by infrastructural development, such as sports stadiums, upgraded public hospitals, recreational centres, public schools and universities,” Namuhuya expressed in a statement yesterday.
Sadly, he said this has not been the case, as Otavi has dismally been denied much-needed growth, despite the presence of the B2Gold mine within its boundaries.
mndjavera@nepc.com.na