Kumba denies influencing licence application

[miningmx.com] — KUMBA Iron Ore, which is 64% owned by Anglo American, on Friday said that at no stage did it attempt to influence the process relating to its application for the 21.4% mining right at Sishen.

Responding to a letter circulated by Jacinto Rocha, the former deputy director-general of the Department of Mineral Resources (DMR) who authorised the grant of
prospecting rights to Imperial Crown Trading (ICT), Kumba said Rocha had made
factually inaccurate statements.

According to Dow Jones Newswires, Rocha accused Kumba of “manipulating the
administrative system to gain advantage and gratification” in regards to gaining
additional rights to the mine previously held by ArcelorMittal South Africa (Amsa).

“At no stage did Sishen Iron Ore Company (SIOC) ever attempt to influence the
process relating to its application for the mining right,” said Kumba in a statement.

It said SIOC had lodged an objection to the competing application as it believed
that the DMR should not have accepted ICT’s application for a prospecting right as
the application was flawed.

When no response was received to the objection, Kumba said SIOC sought to engage more senior officials in the DMR to ascertain the view of the department
regarding the objection. Rocha, refused to engage with Kumba in this regard.

Seeking 100% of Sishen, Kumba applied for the rights when Amsa, which had previously held the 21.4% portion of the SIOC mining right, failed to convert from old order to new order mining rights.

Kumba said in order to protect SIOC’s rights and those of its shareholders, and to
prevent any third party access to those rights, SIOC prepared documents to apply for the rights in the event that Amsa did not convert them.

“SIOC asked for and took advice from officials in the DMR to ensure that its application could be lodged at the earliest possible opportunity after May 1 (a public
holiday),” Kumba said.

It said at no time did SIOC ask for this application to be processed before May 1,
2009 and the application was properly lodged and processed as being received on
May 4, 2009.

“The High Court Review challenging the award of the prospecting rights to ICT will continue and Kumba awaits the outcome of this legal process. At the same time,
the Minister of the DMR has the authority to overturn the grant of the prospecting
right to ICT,” Kumba said.

While the Kumba is pursuing legal avenues in its bid to secure the rights, AMSA
this week surprised the market by offering to buy ICT for R800m. The deal is, of course, dependent on ICT securing the right and the transfer of that right to Amsa.