Transcript The Association of Zambian Mineral Exploration Companies

The Association of Zambian Mineral
Exploration Companies (AZMEC) –
WORKING GROUP 6
Willie Sweta – Chairman / President AZMEC (also representing Zambezi Resources)
Julian Green – Secretary AZMEC(also representing GeoQuest)
Alex Matthews – representing Teal
Gilbert Temba – representing BHPBilliton
William Mulenga – representing Katanga Resources
Dudley Barker – representing Phelps Dodge / FMI
Submission / Presentation to MMMD Legal and Regulatory Review Of The
Mines and Minerals Act, Cap 213 of The Laws of Zambia
Stake Holder Workshop : Inter Continental Hotel
Tuesday 25th September 2007
Who / What Is AZMEC ?
• The aims and objectives of AZMEC are to provide a discussion
forum and dedicated lobby group for large and small scale mineral
exploration companies and interested parties.
• AZMEC has affiliated with the Chamber of Mines of Zambia.
• If you require any further information, please also do not hesitate to
contact AZMEC’s President / Chairman - Mr Willie Sweta on
[email protected] or AZMEC’s Secretary Mr
Julian Green on [email protected] or feel free to browse
AZMEC’s website at www.azmec.co.zm
AZMEC SUBMISSION
•
AZMEC forms ‘stand alone’ / ‘roving’ 6th working group.
•
AZMEC free to comment / provide feedback on anything it considers
important from the 5 focus areas in whatever format it likes (eg bullet
point / brief summaries) with an obvious emphasis on / relevance to
Exploration.
•
It is decided that due to a lack of time that AZMEC would concentrate
on establishing official positions on a selected number of important
issues from mainly Area 1 (Ownership, Licencing and Regulatory)
involving parts of Area 3 (Governance and Administration) and Area 2
(Mining Fiscal Regime).
•
AZMEC’s Submission was formulated at an AZMEC Special Council
Meeting held on Thursday 20th September mandated to act on behalf
of AZMEC members.
The Existing Mines and Minerals Act
: A Position Statement
• AZMEC feels that the existing Mines and
Minerals Act 1995 is still essentially a good
working document and provides good incentive
for Mining and Mineral Exploration Investment in
this country. However AZMEC is very concerned
at the lack of effectiveness / efficiency and
consistency of interpretation, administration and
enforcement of this Act. These latter issues are
currently very strong disincentives for Mining
and Mineral Exploration Investment in this
country.
Application For a License (1)
Various Position Statements
The present situation / process:
•
AZMEC is extremely concerned about the current lack of transparency, general
disorganization, poor communication and the length of time before awarding of licenses
The principal of ‘first come, first serve’:
•
AZMEC supports the principal of ‘first come first served’ provided the applicant meets the
technical and financial criteria for the applicable license category. AZMEC would like to see
a revision of these criteria and have them clearly stated / defined in the revised Mines and
Minerals Act
Security of Tenure (Exclusivity of Licenses, Illegal Mining and license Infringement):
•
AZMEC strongly believes that 2 licences (of any nature) should not be allowed co-exist
over the same piece of ground for different commodities without the express prior written
permission of the first/original licence holder. This should be subject to the area being
clearly demarcated and beaconed prior to award. The first licence holder would be
expected to grant its permission in cases where there is clearly no conflict of interest.
Application For a License (2)
Various Position Statements
The New Cadastral System:
•
AZMEC is concerned about the lack of information / feedback to the Industry on the
progress made so far during the current Moratorium period with only 3 months remaining.
•
What is the MOMMD’s position if the objectives of the Moratorium have not been met and
supporting legislation is not in place by 1st January 2008?
•
AZMEC has concerns about the workability of the new system especially in view of the lack
of clarification / supporting legislation in place for 1st January 2008 for the following
proposed changes
• The minimum and maximum size allowed for each license type
• The maximum cumulative amount of ground (km²) allowed in Zambia for each
tenure holder for each license type?
• The switch to a new graticule ‘cell’ system – when? How?
• Conflict Resolution – See dedicated slide
• The new proposed procedures / timeframes for processing applications
Application For a License (3)
Various Position Statements
AZMEC supports the principal of changing the mandate / structure
of the Mining Advisory Committee. MAC should meet a minimum
of once a month and become a multi – departmental body chaired
by MOMMD. All relevant sectors of government and other important
stakeholders ( eg ECZ, Ministry of Lands, Local Government,
Chiefs, ZAWA etc..) should be represented with a view to MAC
providing a ‘One Stop Shop Service’ making sure all parties are
fully informed / laying the foundation for future necessary dialogue
and ultimately making recommendations to the Minister and Director
MOMMD (Good working examples are the Mining Commission in
Ghana / Licensing Committee in Malawi)
AZMEC believes in principal that the discretionary powers of the
Minister and the Director of MOMMD should be significantly limited.
It feels that this would be best achieved by the new cadastral system
and Mining Advisory Committee working effectively / efficiently.
Duration / Renewal / Relinquishment of
(Part of) A License : A Position Statement
1)
2)
3)
4)
AZMEC strongly feels that the current allowable tenure
period for particularly Large Scale Prospecting Licenses
is too short (especially in a Zambian context) and is not
in line with modern International practice. AZMEC is in
favour of:
A longer initial tenure period of at least 4 years with 2
subsequent allowable renewals of 3 years each.
The doing away with the ‘automatic’ relinquishment of
50% of a licence area at each renewal and rather the
introducing of a new clearly defined escalating license
fee system / structure.
Minimum expenditure figures to be possibly considered
per km per year for each license type.
The general principal of ‘use it or loose it’
‘Conflict Resolution’: A Position
Statement
• AZMEC would like clarification about the
MOMMD’s plans for ‘Conflict Resolution’ –
What does this mean in reality? / How will
this be handled and in what time frame?
• An agreed workable mechanism should be
clearly stated in the revised Mines and
Minerals Act
Confidentiality of Data : A
Position Statement
• AZMEC strongly feels that any data submitted to
the MOMMD during an ongoing tenure period for
any prospecting licence should be kept strictly
confidential. However, upon abandonment of
any license, all data / information generated
should revert to the public domain straight away
for the benefit of the state.
• AZMEC would however like to see an urgent reorganization and re-investment of the state’s
custodianship / archiving of this information.
VAT Re-Claim / Duty exemptions
For Exploration Companies : A
Position Statement
• AZMEC would urge the MOMMD to strongly
support the principal that exploration companies
should be able to re-claim VAT for the duration of
exploration activities/exploration tenure. At
present this falls away at the 5 year point. This is
too short and is a distinct disadvantage to
exploration companies investing in Zambia
(where taxes are already relatively high)
compared with other SADC/COMESA countries.
Shortage of Geoscientists – A
Position Statement
• AZMEC feels that the government of Zambia
needs to adopt a very active policy of reinvesting into the sector and addressing this very
serious problem. AZMEC believes the
government has the perfect vehicle to do this.
AZMEC would like to propose that ZCCM –IH
could donate a small % of its profits to this cause
(in various areas to be discussed) By doing this,
the government is providing leadership and an
example for other companies to follow suit.
Thank you for your attention
• Questions / Discussion ?