MAC/20: Mines and Communities

Africa Update

Published by MAC on 2007-04-14

Africa update

14th April 2007

The Guinea government says it will review all foreign mining contracts, as a new cabinet takes charge following weeks of bloodily-repressed demonstrations against striking workers - some of which were directed against Alcoa.


What may be the final assault against farmers resisting Tiomin's notorious minerals sands project in Kenya took place last Thursday, just as the company announced major new funding from China's Jinchuan.

Titanium: Farmers now evicted

By: JUMA NAMLOLA , The Daily Nation, Nairobi

14th April 2007 The Government yesterday evicted seven farmers from Maumba village in Kwale District who had refused to make way for the titanium mining project. They received a rude awakening when a bulldozer descended on the village at about 3am and started demolishing their houses as a contingent of Administration Policemen kept guard. The exercise was supervised by acting Kwale District Commissioner Isaac Oseko. >A blind farmer was part of those affected as the bulldozer brought down the only structure in his homestead. Mr David Kimenye Maingi, who has four children in secondary school, said he did not have anywhere to go as he did not know any other relative. "I was born blind and this is the only place I have known. My children are in three different secondary schools and I depend on income from this farm to get school fees. It is difficult to say what will happen next," he said. As Mr Maingi spoke, a heavy downpour destroyed some of his children's school books that were strewn in the compound. Another farmer, Mrs Serah Nduku Mulei, 71, and her children were also busy gathering their belongings as she kept on looking at her late husband's grave. The mother of eight told the Nation the farm had been her home for 44 years and did not know how she could cope with life elsewhere. Last November, Nairobi High Court ruled that the Government was justified in forcibly taking over land belonging to the eight farmers to allow for titanium mining. Mr Justice Joseph Nyamu said that, in the public interest, the Government had the right to seize the land belonging to the farmers, who have been unwilling to give it out for the Sh9 billion mining project. The judge said it was apparent the mining project was important for the country and the farmers who were unwilling to vacate citing inadequate compensation were not sincere since they had been part of the Government-brokered negotiations that resulted on an agreed compensation. Through a private valuer, Mr Gitonga Aritho, the farmers argued the compensation of Sh80,000 per acre did not consider the physical structures, social, psychological effects and disturbance caused by the decision. On December 21, the farmers were summoned to Msambweni DO's office for an enquiry attended by two Government valuers. But the farmers instructed their lawyer Gibson Kamau Kuria to get interim orders restraining the Government from evicting them, arguing the enquiry was flowed because it wasn't conducted by officials from the ministry of Lands.

Tiomin and Jinchuan Group Ltd. Announce Private Placement

Toronto, Canada. April 2nd, 2007. Tiomin Resources Inc.

Tiomin and Jinchuan Group Ltd. of China have entered into a Memorandum of Understanding ("MOU") to finance and expedite the development of the Kwale mineral sands project in Kenya.

Jinchuan is investing approximately Cdn.$10.9 million in Tiomin by purchasing 72,521,134 common shares of the Company at Cdn.$0.15 per share. This investment significantly strengthens Tiomin's cash position to about Cdn.$32 million (Cdn.$0.072 cash per share) and increases Jinchuan's equity ownership of Tiomin to 20%. Tiomin has granted Jinchuan an 18-month option to increase its interest in Tiomin to 30% by subscribing for additional common shares at a price of Cdn.$0.35 per share, raising an additional Cdn.$17 million in new cash resources if exercised. The financing is subject to regulatory and Tiomin shareholder approval.

Mr. Jean-Charles Potvin, Chairman and Chief Executive Officer of Tiomin, commented "Jinchuan and Tiomin are united in their desire to jointly develop Kwale. This financing begins what we hope is an accelerated development program with potential cost savings by maximizing Chinese content. Jinchuan is a world-class mining company with extensive project development experience and it is an ideal partner for Tiomin and Kenya. This agreement is a very logical step as we build Tiomin into a global titanium producer and it confirms our belief that the Kwale project has significant merit that is not recognized in Tiomin's share price. Our stronger balance sheet and the support of Jinchuan will enable Tiomin to pursue the acquisition of additional titanium assets worldwide."

Jinchuan ( is the largest producer of nickel, cobalt and platinum group metals in China, combining mining, milling, smelting & refining and chemical engineering operations. It produces nickel, copper, cobalt, precious metals, various bulk chemicals and nonferrous metals.

The output of nickel and platinum group metals are 88% and 90% respectively of total Chinese production.

Guinea re-evaluates mining contracts

Business in Africa

13th April 2007

Conakry - Guinea, the world's top bauxite exporter, is set to review all contracts signed with foreign firms operating in the west African country, government has said.

Spokesman of the two-weeks old government, Information Minister Justin Morel Junior said authorities are to "review all mining agreements, if need be amicably, but if not, we will hire legal firms to defend the interests of the country".

Junior made the announcement on Wednesday night on state television after the first cabinet meeting of the new Guinean government led by a consensus Prime Minister Lansana Kouyate, appointed late February to end weeks of a bloody general strike.

Unions launched sweeping anti-government protests in January paralysing the poverty-stricken but mineral rich country of 9.4 million people, against the ailing President Lansana Conte.

After weeks of bloody street protests which claimed more than 100 lives of mainly civilians, Conte bowed in and appointed Lansana Kouyate as a prime minister of consensus.

Kouyate formed his government on March 28.

Guinea has at least one third of the world's bauxite reserves, a mineral used to produce aluminium.

Observers say the new government believes the mineral exploitation contracts signed with foreign companies and reviewed several times, were made on giveaway terms in this country rated the most corrupt in the world.

Guinea, according to global anti-corruption watchdog Transparency International, is Africa's most corrupt country.

The former French colony is rated among the world's 20 poorest.


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