Government knew of Rössing sale to Chinese
Featured

07 December 2018
Author   CHAMWE KAIRA
Government says the sale of the 68.62 percent stake in Rössing Uranium by Rio Tinto to China National Uranium Corporation (CNUC) is a private share transaction between the two parties.
The comment by Mines and Energy Permanent Secretary, Simeon Negumbo, comes after the ministry was inundated with questions on the sale, as many Namibians questioned why government did not buy the stake or increase its shares from the current 3.4 percent.
He said government was informed last year of the negotiations between Rio Tinto and China National Uranium Corporation for the purchase of Rio Tinto shares.
“Rössing Uranium is not entirely being sold to the China National Uranium Corporation Limited. If Rio Tinto’s shares are sold, we will still be part owners of the company.”
The other shareholders in Rössing are Iranian Foreign Investment Company 15.29 percent, the Industrial Development Company of South Africa 10.22 percent and with other minority shareholder owning 2.45 percent.
Recently the government turned down an offer by the IDC for government to buy its stake, citing financial constraints.
Elipas Hawala the CEO of the state mining company, Epangelo told the Windhoek Observer that he agreed that the shares held by Rio Tinto should first have been offered to the government.
“Unfortunately, I am not privy to the deal. So I do not know how the deal was structured. I agree that the shares should first have been offered to government.”
Hawala explained that the right of first refusal or “pre-emption” is offered to shareholders that are having shares in the company, before it is offered to others.
“I am not sure if that was done and why the government refused to take up the offer to increase its share. My guess was this could have been due to financial unavailability.”
Negumbo said he expect the mine to continue operating under its existing and planned programmes.
Last week, economist Klaus Schade, warned that plans by Rio Tinto to offload its stake in Rössing Uranium for up to US$106.5 million (about N$1,5 billion) could be bad news for Namibia, as the country could now earn less from uranium exports.
Schade said Namibia may earn less revenue in the form of royalties and company taxes from uranium exports if all three uranium producing mines in the country end up with substantial Chinese shareholding, as the uranium would likely not be sold on the international market, but will go directly to China at lower prices.
China General Nuclear Power Corporation (CGNPC) owns the majority stake in Swakop Uranium, which runs the Husab Mine also in the Erongo Region.
CNNC Overseas Uranium Holding Limited, a wholly owned subsidiary of China National Nuclear Corporation (CNNC), owns 25 percent stake in Langer Heinrich, which was placed under care and maintenance earlier this year due to the prevailing low uranium prices on the international market.
 
 
 

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