Impala Platinum said on Thursday it has agreed to turn over a 10 percent stake in its Zimbabwe units to locals after facing pressure from the government to give up equity or lose out in the state with the world's second largest platinum reserves.
Implats, the world's second-largest platinum producer, said in September a government threat to remove Zimplats licence had fallen away after reaching an agreement on a revised plan to comply with a law requiring foreign mining firms to turn over a 51 percent stake to local blacks.
The 10 percent stake is the first tranche is what is supposed to be a majority stake. Zimbabwe has not provided clear guidelines on how and when it expects companies to comply.
Speaking at the official launch of the Zimbabwe Community Trust set up as part of the compliance measures, Chief Executive David Brown said Implats planned a new expansion programme at Zimplats from 2014, which would raise output to 360,000 ounces a year.
Zimbabwe's President Robert Mugabe told the meeting west of Harare that Zimplats had nothing to fear about its investments and it should build a refinery.
Mr Brown, go and tell your shareholders that we don't intend to take over (Zimplats). We don't want to steal or rob that which does not belong to us, but we don't want to be robbed as well, Mugabe said to Brown.
Analysts said the law is more aimed at filling the coffers of Mugabe and his ZANU-PF party ahead of elections that could come as early as next year than it is at lifting incomes in one of the world's poorest countries.
Nonetheless, wholesale asset grabs remain improbable and the chaotic process will be slowed by infighting within government, said Anne Fruhauf, an Africa expert with the political risk consultancy Eurasia Group.
Mining firms risk losing their claims if they do not play along. Many are waiting for a future government more amenable to international investment before they ramp up production, analysts have said.
Brown offered Zimplats' technical assistance to help state firm Zimbabwe Mining Development Corporation mine a claim valued at $153 million which he said had not been utilised since being released to the government.
In 2006, Zimplats released ground with 36 million ounces worth of resource. We note, however, that there's no production on those claims, Brown said.
Zimbabwe has pushed hard in the last few months to have foreign firms, mostly mining firms and banks, to abide by a law to turn over a majority stake of their holdings to locals.
Prime Minister Morgan Tsvangirai's Movement for Democratic Change, forced into a unity government with ZANU-PF after a disputed 2008 election marred by violence, said the law has undermined investor confidence and could strangle a fragile recovery in an economy crushed by hyperinflation under ZANU-PF management.