Business

Suspicion follows ‘victory’ over Xolobeni

2016-07-26 14:03

Anti-mining groups have cautiously welcomed the announcement by Australian mining company Mineral Commodities (MRC) that it has pulled out of the Xolobeni Mineral Sands project.

They said, however, that they would not celebrate the development yet.

This follows a statement last week by MRC that it was disinvesting in the mining project in Xolobeni because of violence and tension in the area.

It had wanted to mine titanium from the red dunes along the unspoilt Amadiba coastline.

According to the application for a mining right, the proposed mining area would have covered about 2 900 hectares, affecting pristine coastline 22km long and 1.5km wide.

The mining proposal left the community divided over which plan would create a better life for them – sustainable job opportunities during the mining or ecotourism. In March, the tensions led to the murder of community leader Sikhosiphi “Bazooka” Rhadebe, who had headed the group opposed to the mining plans.

Nonhle Mbuthuma, secretary of the Amadiba Crisis Committee (ACC), an anti-mining lobby group in Xolobeni in Mbizana, told City Press last week it was not entirely happy with the new developments.

“What MRC announced simply means that somebody else should continue what it started,” she said.

MRC said the continuing violence and threat to the peace and harmony of the local Xolobeni community meant future viability of the Xolobeni project should be managed by “stakeholders and organisations” exclusively owned by South Africans.

It had, therefore, entered into a “memorandum of understanding with its BEE partner, Keysha Investments 178, to divest its 56% interest in Transworld Energy & Minerals to Keysha”.

Transworld Energy owns the Xolobeni Mineral Sands project, along with other subsidiaries. These include Keysha, which is owned by some local community members through the Xolobeni Empowerment Company (XolCo).

“The company has accepted that an attempt to facilitate a peaceful and safe site access by independent environmental consultants to adequately assess the possible environmental impacts of the Xolobeni project has continued to cause undue tension and conflict, something the company has openly tried to avoid,” MRC wrote.

“The company has, and always will have, an ambition to bring prosperity and economic upliftment to the local Amadiba Pondoland inhabitants and the greater Mbizana district.

“It continues to believe the Xolobeni project offers significant value to enable economic upliftment.”

But Mbuthuma said the Amadiba Crisis Committee opposed any form of mining, whether it was done by South Africans or foreigners.

“Our view is clear and uncompromising in that we don’t want mining on our land. It does not matter who is doing it. We suspect they plan to hide behind their BEE partners and continue to do mining in Xolobeni,” she said.

Mbuthuma wondered why MRC did not simply withdraw and shut down XolCo – the company owned by pro-mining people in Xolobeni. These people will own 100% of Keysha once the deal goes through.

“For 10 years, we have said no to mining. Our land is not for sale. We want to develop our agriculture and tourism. Mining is not development. It is destruction of our land. It is killings and violence, no matter if it is black or white,” Mbuthuma said.

Christopher Ngcwele, chair and director of XolCo, said the company would negotiate with South African investors about the future of the mining prospect in Xolobeni once they took 100% ownership and control of the business. He said he was confident that those opposed to mining would come on board.

“We are now working hard to get South African-based investors who have the skills and expertise to undertake the mining project. We are rural folk and know nothing about mining [logistics]. We did not even know that there were minerals in this land until the Australians arrived.”

He accused the anti-mining community group of pretending to oppose mining when they “wanted it for themselves”.

“They did not like the fact that an overseas company stood to benefit more than the locals. It is just propaganda to say they oppose mining in all its forms.”

In a joint statement, the Legal Resource Centre and Richard Spoor Attorneys, who represent ACC and 69 households opposing the mining rights application, welcomed MRC’s decision to divest in Xolobeni, but questioned the proposed alternative.

“We note with concern MRC’s announcement ... It is manifestly unclear how this transaction will be funded, and what compensation Keysha will be obliged to pay to MRC and/or its subsidiaries in return for MRC’s interest in the Xolobeni project,” they said.

Meanwhile, the Makhasaneni community reported last week that the mining company Jindal Africa had withdrawn its application for a mining licence in the area.

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