HARARE, Feb 24 Zimbabwe’s Diamond Mining Company (DMC) plans to sue the government for breach of contract after the Southern African nation banned gem mining in the east of the country, a company official said on Wednesday.
Zimbabwe’s mines minister on Monday ordered nine companies operating in the Marange fields to stop all mining activities and leave immediately because their licences had expired.
DMC general manager Ramzi Malik said that its joint venture contract stipulates that renewing licences was the responsibility of the government, through its state mining arm Zimbabwe Mining Development Corporation (ZMDC).
He said the investment agreements were valid and indefinite and therefore Harare was in breach. Asked whether DMC would go to court if the government did not reconsider, Malik said: “I am sure we will.”
“If you are removing the concession it means you are in breach,” Malik said.
Any action by DMC could trigger similar moves by other mining firms, that could set them on a collision course with President Robert Mugabe’s government, which has unnerved the industry with its policy to force foreign-owned mines to sell majority shares to locals.
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