Government last week took over the running of a Chinese-owned Collum coal mine after revoking its licence because of safety lapses. Mining Minister Yamfwa Mukanga says the government has cancelled all three licences held by Collum Coal mine. GRZ would "continue operating them until a suitable investor is found". Hon Yamfwa Mukanga says, the mine has a poor safety, health and environmental record. It has failed to consistently provide employees with approved personal protective equipment. He added that it did not have emergency medical treatment facilities such as ambulances or a first-aid station underground.
As well as the safety issues, the company had failed to pay royalties or properly declare how much coal was produced. The mine in question has been controversial. The Minister said, "Collum coal mine owes Government a lot of unpaid mineral royalties...last year alone, the debt came close to close to KR5 million (K5 billion)....We will look at how much the mine owes Government and what they have invested and work things out". The key phrase there is"last year alone". One wonders how many other mining houses are in similar position, without paying mineral royalties.
Also since Collum has been acting illegally and owes money, presumably there's little compensation. What now needs to happen is that ZCCM-IH should invite bids for partnership like it did in 2009 with Maamba, when Nava Bharat won. But this should be a 50-50 deal. In general this is a fantastic. Collum mine has been a very nasty stain on conscience of Zambia's mining industry. It has come to represent what happens when money is put ahead of human life. This is a decisive decision.
Equally important is that the Minister has signalled clearly that "Government is not interested in nationalisation", which is clear and definite communication to assure all investors. The Ministry of Mines has made tremendous progress in many areas in recent months. We have seen ZCCM-IH brought back on track. ZEMA's integrity has been restored. The labour movement is no longer fighting their employers. This latest move will again add confidence that Government values human life. We also have recent the signals that Government want higher share in mining companies, alongside a revised fiscal regime. Its not perfect, but I think there's reason to be hopeful.