Alweendo says existing mines, licence holders safe
Existing mines as well as existing mineral or petroleum licence holders in Namibia needn’t fear that government will claim a stake in their operations.
The ministry of mines and energy yesterday issued a strong-worded statement in reaction to international media reports this week that government wants a stake in all mines in the country.
“Government has no intention to seize any stake from existing mineral or petroleum licence holders in Namibia and remains committed to uphold the sanctity of the contract(s),” the ministry’s senior spokesperson, Andreas Simon, said.
Reuters and Bloomberg earlier this week quoted minister Tom Alweendo as saying: “The proposed state ownership should take the form where the state owns a minimum equity percentage in all mining companies and petroleum production, for which it does not have to pay”.
Alweendo indeed said this in his opening remarks on Monday at a parliamentary workshop on maximising mining and energy potential. However, directly before that, he referred to Article 100 of the Namibian Constitution, which states that “natural resources below and above the surface of the land and in the continental shelf shall belong to the state, if they are not otherwise lawfully owned”.
Neither Reuters nor Bloomberg mentioned this in their reports.
Bandwagon
International media jumped on the bandwagon, many of them using the word 'nationalisation' in their reports. This spooked shareholders in internationally-listed companies with mining assets in Namibia. Share prices in some companies slumped between 7% and 20% on stock exchanges in Australia, Canada and London.
Paladin Energy, the majority shareholder of the Langer Heinrich Mine in Namibia, had to halt trading on the Australian Stock Exchange (ASX) on Tuesday when its share price dropped by about 20%.
The ministry yesterday it was “disappointed” in the “wrong perceptions” being based on Alweendo’s remarks.
Just
Although government won’t claim an interest in existing mining operations and licences, the reality remains that Namibians are and remain disadvantaged because they may not have the financial and other means to exercise their rights in relation to natural resources, Simon said.
“As such, the state - as supreme owner of these natural resources - may demand a certain minimum stake through public enterprises such as Epangelo Mining or the National Petroleum Corporation of Namibia [Namcor] in any mineral or petroleum licences that may be issued in future,” he said.
Simon continued: “Namibian people have a legitimate expectation of having a share of ownership in the exploration and mining of our country’s natural resources. Cognisant of the fact that many Namibians might not have individual capacity or the requisite resources to realise these rights in their individual capacities, it would be just that the government acquire these rights on their behalf".
Balanced
Government will exercise these rights in a balanced way, considering the interests of both investors and the Namibian nation, Simon said.
“The ministry would like to reiterate that this is a normal practice in Namibia, especially in the petroleum and mining sectors and that we should maintain such practice in the interest of all our stakeholders.”
The ministry assured current and potential investors that Namibia is a country governed by the principles of democracy and a rule of law enshrined in the constitution, and enforced by an independent judiciary.
“Our government has proven many times that we respect and stand guided by those laws,” the spokesperson said.
The ministry of mines and energy yesterday issued a strong-worded statement in reaction to international media reports this week that government wants a stake in all mines in the country.
“Government has no intention to seize any stake from existing mineral or petroleum licence holders in Namibia and remains committed to uphold the sanctity of the contract(s),” the ministry’s senior spokesperson, Andreas Simon, said.
Reuters and Bloomberg earlier this week quoted minister Tom Alweendo as saying: “The proposed state ownership should take the form where the state owns a minimum equity percentage in all mining companies and petroleum production, for which it does not have to pay”.
Alweendo indeed said this in his opening remarks on Monday at a parliamentary workshop on maximising mining and energy potential. However, directly before that, he referred to Article 100 of the Namibian Constitution, which states that “natural resources below and above the surface of the land and in the continental shelf shall belong to the state, if they are not otherwise lawfully owned”.
Neither Reuters nor Bloomberg mentioned this in their reports.
Bandwagon
International media jumped on the bandwagon, many of them using the word 'nationalisation' in their reports. This spooked shareholders in internationally-listed companies with mining assets in Namibia. Share prices in some companies slumped between 7% and 20% on stock exchanges in Australia, Canada and London.
Paladin Energy, the majority shareholder of the Langer Heinrich Mine in Namibia, had to halt trading on the Australian Stock Exchange (ASX) on Tuesday when its share price dropped by about 20%.
The ministry yesterday it was “disappointed” in the “wrong perceptions” being based on Alweendo’s remarks.
Just
Although government won’t claim an interest in existing mining operations and licences, the reality remains that Namibians are and remain disadvantaged because they may not have the financial and other means to exercise their rights in relation to natural resources, Simon said.
“As such, the state - as supreme owner of these natural resources - may demand a certain minimum stake through public enterprises such as Epangelo Mining or the National Petroleum Corporation of Namibia [Namcor] in any mineral or petroleum licences that may be issued in future,” he said.
Simon continued: “Namibian people have a legitimate expectation of having a share of ownership in the exploration and mining of our country’s natural resources. Cognisant of the fact that many Namibians might not have individual capacity or the requisite resources to realise these rights in their individual capacities, it would be just that the government acquire these rights on their behalf".
Balanced
Government will exercise these rights in a balanced way, considering the interests of both investors and the Namibian nation, Simon said.
“The ministry would like to reiterate that this is a normal practice in Namibia, especially in the petroleum and mining sectors and that we should maintain such practice in the interest of all our stakeholders.”
The ministry assured current and potential investors that Namibia is a country governed by the principles of democracy and a rule of law enshrined in the constitution, and enforced by an independent judiciary.
“Our government has proven many times that we respect and stand guided by those laws,” the spokesperson said.
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