Zimbabwe Government Sets Up Shadowy Company To Mine Chiadzwa Diamonds

These diamond panners from Marange have all but disappeared from the scene as two new companies are now authorised to operate. However, there is more to it than first meets the eye, with one of the two companies still waiting to be given the go-ahead and another, said to be army-owned, already processing thousands of tonnes of ore a day.

Harare, Zimbabwe, 14 November 2009

The Government of Zimbabwe, in a desperate bid to hoodwink the Kimberley Certification Scheme, has set up a shadowy company and given it a licence to mine diamonds at the super-rich Chiadzwa Diamond Fields.

Government announced a few weeks ago that it had now licenced two investors to help the Zimbabwe Mining Development Corporation (ZMDC) exploit Chiadzwa and there are now frantic propaganda efforts to make it appear as though things have been regularised there.

But informed sources say that of the two companies said to have been licenced by the government of Zimbabwe, one is owned by the defence forces of Zimbabwe and is so well-capitalised that it has now managed to set up state-of-the-art machinery bang in the middle of the Diamond Field itself.

Betraying the fact that the announcement of two companies is simply designed to hoodwink the world, the alleged army-owned company, called Mbada (meaning leopard in the local Shona language) got permission to start mining the diamonds of Marange almost two months ago.

Yet, the other company also licenced, a South African company, Canadile, has not only been relegated to a 1000 hectare claim at the edges of the Field, near Odzi river, but has also been told that they do not yet have permission to start mining and processing ore.

At the moment, the army-owned company is busy processing hundreds of thousands of tonnes of ore a week while Canadile sits there twiddling its thumbs.

The ownership structure of Mbada is a closely guarded secret in Zimbabwe and no one knows who its shareholders are, not even cabinet ministers who should have debated the matter in Cabinet and given the nod.

While the government of Zimbabwe has announced that diamonds mined at Chiadzwa will not be traded just yet, it is not clear where the diamonds that Mbada is processing are going. The volumes they are mining daily at the moment are huge and it is inconceivable that they are just sitting on their riches while waiting for for the Kimberley Team to show up in Zimbabwe next month or the month after that.

The KP Team is supposed to come and monitor compliance at the Chiadzwa Diamond Fields to ensure that there are no abuses and that the Zimbabwe diamonds pass the test of not being classified as conflict diamonds.

There are still soldiers on the ground at Chiadzwa and these are now openly protecting the private property belonging to Mbada Mining. In addition to this, the government of Zimbabwe has also sent in members of the dreaded Central Intelligence Organisation (CIO) to monitor the diamond mining area of Chiadzwa. The CIO are playing a classic intelligence-gathering role, monitoring the area for people who might be poking their noses into the operations of Chiadzwa.

My sources are adamant that the proceeds from the illegal sale of Chiadzwa diamonds have financed the state-of-the-art equipment that are now being used at the Diamond Fields. Because of the extremely secretive nature of Mbada mining company, it is not possible to establish for a fact from them where they got the funds from or even to speculate.

What is known about Mbada is simply that it is a locally-owned company with no foreign shareholders. Considering the state of Zimbabwe's economy at the moment, it all begs the question of who or what is financing the expensive equipment that they are using.

The Chiadzwa Diamond Fields are under dispute at the moment, with Africa Consolidated Resources, a British-based firm, claiming ownership of them, a claim that was recently upheld by the courts in Zimbabwe.

The government of Zimbabwe now says that the two companies licenced to operate at the diamond fields, Mbada and Canadile, are not mining the area under dispute. This is despite the fact that when the announcement was made, the same government said these two investors will be partnering the ZMDC in mining for diamonds in the area.

Official figures from the government of Zimbabwe claim that exports of diamonds are earning only US$20 million a month, a far cry from the potential US$200 million that was announced by Reserve Bank of Zimbabwe Governor Gideon Gono earlier this year.