Imperial Crown Trading vies for part of Sishen

Allan Seccombe | Thu, 18 Mar 2010 16:44

[miningmx.com] -- Empowerment company Imperial Crown Trading 289 is the third party that has been granted a prospecting right over a 21.4% stake in Kumba Iron Ore's Sishen Mine, prompting the miner to lodge an appeal against the decision.

Imperial Crown Trading has a Monica Ripepi, Mabelindile Archibald Luhlabo and Prudence Zerah Mtshali listed as directors. It appears that Ripepi sets up and sells shelf companies.

Three sources confirmed the identity of the company that was granted the prospecting right over part of South Africa's largest iron ore mine at 40 million tonnes a year. Imperial Crown Trading was formed in September 2008.

The Department of Mineral Resources late on Thursday confirmed Imperial Crown Trading was awarded the prospecting right after ArcelorMittal's old order mining rights to the 21.4% lapsed and reverted back to the state.

Mtshali, who is also known as Gugu, was reported by a number of South African newspapers in early 2009 to be romantically linked with deputy president Kgalema Motlanthe, at which time she was holding down an administrative job in Luthuli House, the headquarters of the ruling African National Congress.

Asked about political connections in Imperial, DMR director general Sandile Nogxina told Miningmx: "When we process the applications, it is not a requirement that we have to look at what political parties people may belong to, we don't have to pierce the veil and see that. It's not a requirement in terms of the law."

Amongst five other directorships, Mtshali is also on the board of Vuna Coal Holdings.

Also on the board of Vuna is Andrew Hendricks, the husband of Lindiwe Hendricks, the former minister of water affairs and ANC member. Vuna, a subsidiary of Vuna Mining Enterprises, and the department were taken to court by Xstrata over contested prospecting and mining rights.

Xstrata said the then department of minerals and energy had granted rights to Vuna in 2005 instead of itself at a time when Lindiwe Hendricks was the mines minister.

Out-of-court talks have been underway between the three parties and are believed to be close to resolution.

Kumba says it has applied for a mining right over the 21.4% stake in Sishen that ArcelorMittal South Africa lost because it did not apply to convert an old-order mining right by the deadline of end-April 2009.

Sources say Kumba made its application in early May 2009, the same day on which Imperial Crown Trading put in their prospecting application.

In terms of the Mineral and Petroleum Resources Deveopment Act, if two companies apply for the same mineral on the same property on the same day preference will be given to "historicallly disadvantaged persons".

This is something Kumba's lawyers are investigating.

Kumba, which is 63% held by Anglo American, owns the rest of the Sishen mine.