HARARE – President Robert Mugabe’s government has resolved to cancel the Gye Nyame Resources (GNR) joint venture agreement with William Ato Essien's company after a series of external audits have exposed the Ghanaian investor’s “irretrivable failure and neglect of his obligations”.
Although Mines minister Walter Chidakwa has sidestepped the issue by saying he “awaits a report from the Zimbabwe Mining Development Corporation (ZMDC)”, sources said at least two Asian investors had been recommended for the west African group's stake in the Chiadzwa diamond venture.
“There has been a lot of dust about this venture and concession, but you will be aware that the west African did himself a great deal of undoing by failing to honour his (financial and operational) commitments, as confirmed by two forensic audits from Kudenga & Company and another firm,” people familiar with the development said.
“As things stand, Gye Nyame has ground to a halt and reports have been sent to the president about the dire situation on the ground, which l believe has also necessitated the ZMDC board to invoke its rights in cancelling the marriage,” they said, adding there was nothing unusual about the planned action since Essien’s grouping had long been put on notice.
The minister, it was said, was expected to make a pronouncement on the issue soon.
While the company was thrust into the spotlight after Mugabe had said in August that a number of his government officials had solicited for a $6 million bribe from the stricken investor, GNR’s workers remain the worst affected since they have gone unpaid for eight months – thus forcing Manson Mnaba’s board to send dozens on forced leave.
Even, though, a team of nine Zimbabwe Republic Police detectives was reportedly dispatched to Accra, Ghana months ago to substantiate Essien and the 89 year-old's serious allegations, the former failed to take up the offer.
Should government succeed to cut ties with Bill Minerals (BM), it becomes the second private sector player to lose its mining rights in the controversial gem fields after Lovemore Kurotwi's Canadile Miners in recent years.
And since taking over in March, Mnaba's relatively new board has instituted several measures to stabilise the operation, but this has not been enough owing to serious underfunding.
As it is, the company is technically insolvent with several outstanding statutory obligations and other issues – a development, which might have strengthened government’s resolve to ditch Essien.
At most, the Ghanaian investor injected only $8 million out of an agreed $110 million, the forensic reports also say. The reports also say there was no proper verification or due dilligence – by the State mining conglomerate and – "from the outset" to ascertain BM's financial capabilities.
Due to his handling of the asset – partly owned by the police and the ZMDC – Essien's investment in the concession has largely been characterised as "half-hearted and speculative".
"They have left this venture in such a mess and its management has either chosen to go underground or adopted an ostrich syndrome at the hour of our greatest need. Frankly, they have abdicated on their duties, if not outrightly neglected or abandoned Gye Nyame," added the source.