- Regulatory compliance is key to getting the gold ambition right
The parent company of Zambia’s recently launched gold company has announced that its subsidiary has made an initial investment of K45 million that will see the outfit establish a regulatory compliant mining house in the heart of North Wester Province, according to a published statement from the ZCCM IH.
“ZCCM Gold Company has injected approximately K45 million for the initial phase of the Kasenseli Gold Mine Project in Mwinilunga”, read a statement issued by the Head of Public Relations at ZCCM IH Loisa Mbatha-Kakoma on 27th April 2020.
ZCCM Gold Company, under the stewardship of ZCCM IH, is on course to deliver on a gold strategy that will see the company redefine how mining ought to be done in Zambia through regulatory compliance, health and safety and security of the lucrative gold value chain.
Despite the pebble in the foot of the management team regards getting the necessary licenses, ZCCM Gold has been awarded an important license that legitimizes their operations in Chief Chibwika’s area. “With the granting of the exploration license by the Ministry of Mines and Minerals Development end of March 2020, ZCCM Gold moved on site and started mobilisation in the first week of April 2020 to undertake detailed exploration that will determine the extent of gold mineralisation in the license area”. However, “mining and processing of the alluvial (surface) gold is pending approval of the Environmental Project Brief (EPB) by the Zambia Environmental Management Authority (ZEMA), and the granting of the mining licence by the Ministry of Mines.”
Best Corporate Governance practices as required by the Lusaka Securities Exchange listing rules, the Mines and Minerals Development Act, the Zambia Public Procurement Authority Act, and the Zambia Environmental Management Authority Act are necessary if ZCCM IH is desirous of getting the gold ambition right.
This is why CEO Mabvuto Chipata could stand on firm ground when he made a curtsey call to Chief Chikwika who is custodian of the surrounding areas and a critical stakeholder who must be managed closely to ensure the smooth implementation of a project that has an entire country’s attention. Providing feedback on the progress made is crucial in stakeholder management as it gives comfort to the Chief that all procedures are being followed by the letter of the law and that they will ensure that the gold activities are not only safe but also free of any regulatory issues that could led to jeopardize the project.
However, regulatory compliance is only part of larger part of the jigsaw puzzle that ZCCM Gold has been assembling. Following the announcement by the parent company in early January 2020 that gold was a strategic focus area, Karma Mining Services and Rural Development signed a Joint Venture (JV) with ZCCM Investment Holdings to form a gold company “Consolidated Gold Company of Zambia – CGCZ Ltd” for the purpose of developing a gold processing operation in Zambia will take off by end of March 2020.
This was followed up with the creation of a Gold processing laboratory worth US$3.5 million that was commissioned in March 2020. It was during this period that ZCCM IH CEO also announced that gold would be purchased from artisans at K550 per gram and that talks with various companies outside Zambia are at an advanced stage to secure a viable market for the off-take of gold that will be due to be sold.
With security concerns being raised recently, ZCCM Gold has acted by enhancing the security of the part of the gold value chain in collaboration with the local community thus creating share value by way of creating jobs. “Over 40 locals will be employed in the fencing exercise scheduled to start this week”, read the issued statement. “The fence is an additional security measure to the state security that is already on the ground and keeping vigil, patrolling the area to wade off any illegal activities”. With security in place, ZCCM IH is ensuring that traceability of the gold is protected as this is what attracts foreign markets who are critical of conflict minerals.
Beefing up the security at the mine will ensure that it stems off Illicit trafficking in precious metals which generates a number of local and global challenges and threats. Illicit mining not only causes harm to gold mining ambitions but also severely hinders the socio-economic development of producing countries while putting local communities at risk.
With many moving pieces, it is very clear that Mabvuto Chipata and his legion of business and strategy analysts have been working round the clock to ensure that Zambia gets this right as it is part of the group’s 5-year strategic plan.
On Gold, ZCCM IH’s gold’s mandate is a significant one. “ZCCM Gold is undertaking and overseeing all gold-related investments throughout the gold value chain in the country including exploration, mining, processing, refining, marketing, trading, and beneficiation in Zambia.”