By: Christy van der Merwe
Published on 22nd August 2008

A series of consultations with communities affected by the proposed heavy-minerals mining operation in Xolobeni, on the Eastern Cape Wild Coast, would take place over the following weeks, Department of Minerals and Energy (DME) spokesperson Bheki Khumalo said on Friday.

This came after the Minister of Minerals and Energy, Buyelwa Sonjica, visited the area on August 15 to hold a meeting with local community members, after the State granted Australian company Mineral Commodities (MRC) the right to mine the Kwanyana block, in the Xolobeni project area.

It was estimated that were over 3 000 people in attendance for the Minister’s visit, who wished to see mining go ahead, while there were some 200 ‘anti-mining’ protestors, led by the Amadiba Crisis Committee (ACC).

The ACC was formed by affected community residents who felt that the community had not been consulted or properly informed about the mining proposal and the real interests that lie behind the black economic empowerment (BEE) company Xolco, that was formed, claiming to represent the community. 

Sonjica stated that mining in the area would bring employment and economic activity to uplift people from poverty.

Khumalo said that the Minister met with the crisis committee for two hours after her speech at the event. “Out of that meeting it was agreed that a team of officials would go back and meet with the group again. So on Wednesday [August 20] they went [to Xolobeni] again and they were expecting to meet with a group of about 30 people, and I’m told there were about 500 people there,†said Khumalo.

“With a thing like this, you can’t impose it, you have got to get the buy in of the community, you have got to use persuasion, you can’t use force. That is why the Minister sent those officials back. And a series of consultations with those groups will continue over the next weeks,†he added.

Social worker for the affected community, John Clarke, was in attendance at the meeting, and explained that, although useful, the meeting felt like a “check-box exerciseâ€.

Khumalo explained that the mining right would be granted on October 31, and for a period of thirty days, affected parties would be allowed to access all information and had the right to appeal or object to the granting of the mining right. It was at that stage when the DME would deal with any official objections or appeals.

Groups in opposition to the granting of the mining right have already voiced their intentions to appeal the granting of the mining right.

Meanwhile, MRC has made a board decision that it would not release comment or answer questions put forward by journalists. The Australian company would not indicate how many jobs would be created by the project, what infrastructure would be brought in to benefit the community, nor would it outline BEE structures or environmental management plans.

MINERAL COMMODITIES

Meanwhile, MRC on Friday responded to inquiries from the ASX regarding the fact that the company “may not have sufficient cash to fund its activitiesâ€.

The ASX noted that for the financial period ended June 30, MRC reported receipts from customers of A$0, and negative operating cash flows for the quarter of A$947 000. Cash at the end of the quarter was A$674 000, and the estimated cash flow for the next quarter was A$700 000.

MRC responded by saying that it had sufficient liquid assets to fund its activities, and “whilst the cash balance at the end of June 2008 quarter was A$674 000, one should note that the company holds about 18,5-million shares in ASX-listed Allied Gold. The market price of Allied Gold at August 19, 2008 was A$0,28, representing a value of about A$5-million to the company.â€

MRC was in March 2008 granted the right to mine along South Africa’s West Coast by the DME. The stage of development of the Tormin mineral sands project was not stated.

The company’s only other project was in diamond tailings operation, in Koidu in Sierra Leone, although in June, the company notified shareholders that it entered a conditional head-of-agreement to sell its interest in this project to ROK Diamonds. Included in this stake was the No 11 diamondiferous dump at Koidu, and items of plant and equipment. The consideration for the sale was $2-million.

Posted on August 25th, 2008
Filed under: Newspaper and Media