Mining rights issue tarnishes S

Canada Goose online By Agnieszka Flak and Julie Crust

JOHANNESBURG/LONDON, Aug 24 (Reuters) South Africa handling of two disputed mine right uk canada goose outlet awards has damaged the resource rich country reputation and raised investor concerns over transparency and governance.

canada goose deals Kumba Iron Ore, a unit of Anglo American, and Lonmin have said the government deprived them of mining rights when it awarded prospecting licences, some to people linked canada goose store to high ranking officials, over areas where the two mining giants operated.

canada goose coats The biggest worry for the industry is that mining rights they canada goose uk black friday have exploited for years could come under government review and they could lose a part of their businesses to companies with deep political www.canadagooseoutlet4sale.com ties and little experience in mining.

South Africa is the world biggest producer of platinum and ferrochrome and the fourth largest gold miner.

The canadian goose jacket mining sector influence on the economy may have declined, but Canada Goose Coats On Sale it is still one of the country top employers, and accounted for 5.2 percent of the country gross domestic product in the first quarter.

canada goose coats on sale Disputes over mineral rights have erupted as miners in the country struggle with power shortages, canada goose black friday sale rising electricity canada goose uk outlet and wage costs, a strong rand and stricter safety measures following a string of deaths.

Mining companies were required to convert their mining rights by a set date or lose them altogether after a new mining act took Canada Goose Outlet effect in 2004. The new legislation sought to avoid discrimination in the system and to Canada Goose Online better distribute assets among historically disadvantaged groups.

The mining ministry last week admitted there were and inconsistencies in the mining act canada goose clearance sale and promised a major overhaul of the legislation, but also said that rights already awarded were unlikely to be revoked. uk canada goose It imposed a six month halt on new prospecting bids until the ambiguities are addressed.

canada goose store certainly need to deal with the perception that there is a less than transparent process for being canada goose factory sale granted mineral rights and create confidence in investors, said Alison Turner, analyst at Panmure Gordon.

Canada Goose Jackets Mining Minister Susan Shabangu also dismissed allegations of corruption in her department, buy canada goose jacket cheap but said some officials had been suspended pending unspecified investigations.

canada goose events surrounding Kumba and Canada Goose sale Lonmin of late have evidenced a very worrying trend, but we certainly welcome the minister move to bring certainty back to the market, said a spokesperson for a miner with operations in South Africa.

cheap Canada Goose However, some in the mining sector are canada goose coats sceptical about the ministry ability to resolve Canada Goose online the issue and are worried about the perceived lack of leadership from President Jacob Zuma.

The mining right deals have Canada Goose Jackets triggered a volley of criticism directed at Zuma government, alleging that it suffers from a leadership vacuum where cronyism thrives, just over a year into the new administration.

Canada Goose sale Investors in the mining sector are already concerned about repeated calls for nationalisation of mines by Julius Malema, the outspoken youth leader of the ruling ANC.

canada goose clearance The two prospecting rights were awarded to parties linked to either Zuma or other high ranking officials, leading to analysts, business and organised labour criticising the government for favouring a few over canada goose the interests of the state.

Canada Goose Outlet The Kumba decision, in particular, alarmed many of the world largest miners operating in South Africa, analysts said.

big boys have got to be concerned by that and I should imagine they have got their legal departments to crawl all over their current new order mining licences, said Peter Davey, an analyst at Ambrian Capital.

canada goose black friday sale The criticism also pointed at mining deals struck under the umbrella of black economic empowerment, meant to spread the wealth among previously disadvantaged groups, but benefiting buy canada goose jacket a narrow group of business elites.

canadian goose jacket In a move to regain mining rights it failed to convert, ArcelorMittal South African unit said it would transfer 26 percent of its shares to employees and a group of black investors including an investment group led by Zuma son.

call it regardless of the true intention, the perception and image Canada Goose Parka is there of looking like the ANC is looking after its own, said Peter Attard Montalto, emerging markets economist at canada goose uk shop Nomura in London.

South Africa business leaders have cheap Canada Goose blamed the mining rights controversy for damaging the nation reputation, just weeks after the country hosted a successful soccer World Cup, and for causing harm beyond the mining sector.

canada goose clearance sale are more wary, said Panmure Turner, but she noted that the mining companies had few options.

South Africa accounted for around 77 percent of the world platinum production in 2009 with output elsewhere mainly canada goose coats on sale coming as a by product from base metal or palladium mining.

Canada Goose Parka problem with mining all over the world is that the minerals sit where they sit. If you want to mine platinum then you have got to be in South Africa to do that, said cheap canada goose uk Turner.

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