TIMELINE | From a failed sale to Kuvimba takeover: all our coverage of ZMDC’s selloff

Hungry for investment: ZMDC's rusty mines

Kuvimba Mining Company now controls mines previously run by the State-owned Zimbabwe Mining Development Corporation (ZMDC).

The mines, for years deep in debt and mostly idle, were first put up for sale in 2018.

Here is a timeline of newZWire’s coverage over the past two years from government’s attempts to sell-off the mines, to its controversial decision to place them under Kuvimba.

2018: For Sale

In early 2018, government began the process of letting go of some ZMDC mines.

This made sense; most ZMDC mines were either under care and maintenance or operating well below capacity, but some sit on attractive deposits that would likely be a draw for potential investors.

The assets were to either be sold outright or investors would be invited into joint ventures. In total, six ZMDC mines were on the table; Jena Gold Mine in the Midlands, Elvington Gold Mine near Chegutu, Sandawana emerald mine in the Midlands as well as Mbungu and Gwayi SG in the south.

Mines Minister Winston Chitando said a further 20 assets would also be put on the market by the end of November.

“As government, we would like to see each and every asset owned by ZMDC getting into production,” Chitando said.

In total, government got over 151 bids for the mines. Caledonia Mining, which already operates Blanket mine, was among the bidders for the two gold mines.

READ HERE | For sale: Canadian firm among 151 willing buyers in Zimbabwe mine fire-sale

No Sale: Why the mine sale failed

In 2019, the government announces that it is halting the sell-off. According to Mines Minister Winston Chitando, the bidders failed to meet the required standards.

“The whole idea is really not just to give the best bid but to ensure that we get the best value for the country,” says Chitando.

By Chitando’s own admission, “some of the assets in question had no geological information”. The tender process had been “just really to say here is this mine come and bid, so you find that compromises the quality of the bids you get”.

We report how advisors, German engineering consultants DMT GmbH & Co, had detailed why potential investors had stayed away; too much State involvement in the industry, and no “value proposition” for investors.

It then became clear to mining players that, eventually, government would look within to get the mines back up again.

READ HERE | ‘You don’t know what you want’: Why Zimbabwe’s big mine sale is failing

How much did the mines need?

Why was the geological data so outdated? It was because of lack of exploration. In 2018, ZMDC spent $1.8 million on exploration, a fraction of what was needed to come up with details of just how much the company had in resources.

The mines themselves were thirsty for new money. One ZMDC report said the mine needed US$18.5 million just to get it working again. The ZMDC offer to investors placed the burden on investors to put in all the capital. Sabi owed over US$3 million salary arrears.

Follow Landela

In July last year, Landela is announced as the winning bidder for “ZMDC Gold Assets and Sandawana Mine”. Among these were Jena and Elvington, which had shut down in 2003 after the collapse of one of its main shafts. Sakunda, the commodities company linked to Kuda Tagwirei, was also awarded Special Grant 5 755 near Lupane to prospect for gas.

READ HERE | Zimbabwe is selling off some of its mine assets. Here’s a look at who is getting what

ZMDC: Caledonia signs MoU

In October last year, Caledonia Mining signs an MoU with the government to evaluate a possible investment in ZMDC’s gold assets. But we report that, with Kuvimba already announced ‘winner’ of gold mines, it is unclear which ZMDC mines would still be available for Caledonia.

READ HERE | ‘Last frontier’: Caledonia takes first step in Zimbabwe expansion plan, signs MoU to assess State gold mines

Kuvimba’s grand arrival

With the ZMDC complete, Kuvimba lists ZMDC mines among its assets. We report on questions surrounding how the mining company came to hold these and other assets.

READ HERE: Kuvimba: How to hide a mining giant in plain sight