Africa Mining: Zimbabwe signs $4.2 billion mining investment deal with Karo Resources

The deal has now come under the Oil Ministry’s scanner following allegations that OVL might have overpaid Videocon.

Cyprus-based Karo Resources will invest $4.2 billion to develop a platinum mine producing 1.4 million ounces of platinum group metals annually by 2023, Zimbabwe Mines Minister Winston Chitando said on Thursday.

Zimbabwe is again attracting investments into the mining sector after foreign investor confidence dipped during the rule of former president Robert Mugabe, who was forced to resign in November following a defacto army coup.

New President Emmerson Mnangagwa has promised to open up investment opportunities to foreigners and change some rules, such as the empowerment law for the mining sector.

Work on the new project, to be located in the Mhondoro-Ngezi platinum belt west of the capital Harare, is expected to start in July, Zimbabwe Mines Minister Winston Chitando said.

“This is the largest investment structure in the country’s mining industry in Zimbabwe. The landscape of Zimbabwe’s mining industry will never be the same,” Chitando said during the signing ceremony with Karo Resources executives.

Chitando said Karo Resources was expected to be fully compliant with the empowerment law from the start by giving up majority ownership in the project. He did not give more details.

The government said on Monday it had changed its empowerment law to limit majority ownership by state entities to only diamond and platinum mines and not the entire mining sector as in previous legislation.

The platinum project is expected to directly employ 15,000 people when fully implemented, Karo Resources head Loucas Pourolis said.

Reporting by MacDonald Dzirutwe; Writing by Olivia Kumwenda-Mtambo; Editing by James Macharia

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