Key documents relating to De Beers' diamond exploration in Marange have vanished from the Ministry of Mines and Mining Development, giving a dramatic twist to a government campaign against the world's largest diamond producer and processor which exited the country under controversial circumstances in 2006, says Shame Makoshori, Senior Business Reporter with Zimbabwe’s Financial Gazette, in an article posted on its online edition on November 16.
Government has accused De Beers, which started exploration in Zimbabwe in 1993 but left 13 years later after forfeiting its Marange claims controversially taken over by African Consolidated Resources (ACR) and then later by government, of plundering the country's diamonds during its exploration activities, the Financial Gazette says.
De Beers had been granted extensive exclusive prospecting orders (EPOs) for diamond exploration when it came into the country covering a significant fraction of the country. It held a total of 47 EPOs in Chipinge and Chimanimani districts, the first of which was gazette on March 14, 1996.
The Financial Gazette's Companies & Markets understands that the missing records formed the backbone of an extensive investigation into allegations of massive diamond looting and shadowy exportation of samples by De Beers from the heart of the controversial Marange fields, said by global gem experts to bear the highest concentration of gems worldwide.
The Mining Promotion and Development Unit (MPDU) kept the missing documents, which had information highlighting De Beers' export of ore samples during exploration.
A crack team, put together by Mines Minister, Obert Mpofu, to investigate allegations against De Beers, is understood to have already compiled a report. The report has since been submitted to Mpofu.
Investigations by this newspaper revealed that the report had suggested that there was a possibility that De Beers illegally exported Marange diamonds during exploration.
De Beers has publicly denied the allegations.
"ZGS (Zimbabwe Geological Survey) does not have a complete set of records showing soil/rock sample exports (by De Beers)," the report said.
"The same holds for (the Department of) Metallurgy. Records at both departments depend on copies that will have been sent by Mining Promotion and Development Unit (MPDU). The export records at MPDU could not be found," the report noted.
Officials within the Ministry of Mines said they feared manipulation or destruction of evidence by some officials "to advance certain interests".
There was even speculation of bribery within the ministry, with reports suggesting an investigation could be launched to establish how the documents had disappeared.
Interestingly, last week, government began hunting for a director and deputy director to head the MPDU.
It was unclear if these vacancies had arisen after incumbents had been sacked as a result of the latest developments at the MPDU. But indications were that without substantive leadership, the MPDU had become porous and vulnerable to theft of documents.
Mpofu, who has described De Beers as "an international looter" for allegedly failing to report the discovery of gems in Marange, had threatened to tackle the global diamond giant through the due process.
He has said he was convinced De Beers had conducted full-scale mining, and exported billions of United States dollars worth of diamonds, before abandoning its EPOs in 2006.
It is reliably understood that the vanished documents were likely to form the basis of Mpofu's case in the event that government sought recourse through the courts.
But it would appear that Mpofu and his team at the ministry will now have to deal with establishing the identity of people who could have pulled the documents out of the ministry's vaults, for whatever reason and to protect whose interests.
De Beers' exploration activities in EPOs 1,059 (Marange) and 1,062 (Matowa) in eastern Zimbabwe had started in 1996 and ended in 2006.
The EPOs first lapsed in 2001 and had been renewed in 2002. The EPOs changed from 1,059 and 1,062 to 1,523 and 1,520 respectively.
The missing documents would have helped government to establish the quantum of diamonds, if any, extracted by De Beers (South Africa) from the ore samples exported by the local unit.
Details obtained by Companies & Markets indicate that over the 13-year period, De Beers moved out significant volumes of ore from the Marange diamond fields to South Africa, which included the following:
- 1996 to 2000: De Beers exported 1,063 tonnes of samples.
- 2002 to 2006: 152 tonnes of samples and 512 kg of concentrates were exported. De Beers later reported that the deposits fell far too short of its expectations and hardly made a strong business case.
- November 1, 2000: eight tonnes of crushed rock.
- July 16 2001: 4,000kg of exploration samples.
- July 5, 2001: Four tonnes of crushed rock were exported.
- October 26 2001 and January 2 2002: 400 tonnes of exploration samples.
- May 27 2003: 100 tonnes of exploration samples were exported.
- January 5, 2000 to June 29, 2000: 50 tonnes of crushed rock samples.
- August 10, 2001: 30,000kg of crushed bulk rock samples
- December 1, 2003: 150,000kg of exploration bulk rock samples.
- January 14, 2004: 100,000kg of bulk kimberlitic rock samples.
- August 16, 2000 to September 14, 2000: Six tonnes of crushed rock samples
The report, a copy of which was seen by this reporter, alleged that despite De Beers reporting "unbelievable results" in the EPOs, a diamondiferous conglomerate had been discovered in EPO 1,523 in 2003 but had been kept secret.
Last month, Parliament said three firms now mining in Marange - Mbada Diamonds, Marange Resources and Anjin - were extracting 164,489,18 carats, 104,713,01 carats and 234,749,92 carats per month respectively.
Mbada Diamonds has been mining in EPO 1,523, the same claims that De Beers abandoned.
In a 2004 report to government, De Beers said it had extracted only 279 carats from the EPOs between 1993 and 2006.
"The results from a single sample taken over the Chikara-01 kimberlite were also not encouraging, producing 5.2 carats from 94 tonnes of kimberlite material," De Beers said in the 2004 report.
However, London-listed ACR, which took over the claims in 2006, disclosed to its shareholders that it had discovered economic diamond deposits in the same EPOs.
ACR chief executive officer, Andrew Cranswick, believed, however, that De Beers had abandoned the EPOs before discovering gems.
"De Beers controlled the exploration rights in that area for many years and did not discover the Argyle deposits," he said in 2009.
"Once they relinquished the ground, others looked again and found the deposit," Cranswick added.
In e-mailed responses to Companies & Markets, De Beers rejected claims that the company had plundered diamonds during its exploration activities in Zimbabwe, insisting that everything was done above board.
"As we have said repeatedly before, these allegations are totally untrue," De Beers' communications manager, Innocent Mabusela, said.
"I think it's worth reminding people of the chronology of events in Zimbabwe. An exploration team from De Beers arrived in Zimbabwe in 1993 and left in 2006, and first prospected in the Marange area in the late 1990s. Amongst the reasons for relinquishing the Marange licenses were: Most significantly, after carrying out sampling across the area, we concluded that the deposit did not fit the profile of our other activities elsewhere in southern Africa.
"Our view was that our resources would be better invested in other prospective areas more suited to our commercial objectives; in addition, the government had created an environment of uncertainty regarding the status and future of the concession. By 2006, the area was being worked by unmanaged, itinerate diggers. All of this resulted in an unacceptable level of risk for De Beers in maintaining a presence," he said.
"As part of the prospecting work programme to search for the possible kimberlite sources for the diamonds emanating from the Marange area, as well as understand the geological nature of the Marange diamond deposit itself, De Beers routinely collected soil and rock samples, which were submitted to the De Beers laboratories in South Africa for analysis. Such samples were exported through and with the authorisation of the Geological Survey of Zimbabwe in accordance with all the necessary export procedures and suitably signed off.
"The prospecting reports detailing the results and analysis were submitted to the Minister of Mines, in accordance with the Zimbabwe legislation," Mabusela said.
However, government investigators believe crucial data was never submitted to the Ministry of Mines.
"De Beers showed that there is a lot of information that they kept to themselves. There may be other areas where they may have made discoveries, but have not said anything on them. They have not been faithful in returning even the few stones they say they have. De Beers took both soil samples and conglomerate rock samples in areas now known to have the highest concentration of diamonds in the world, but reported unbelievable results from the area," the report said.
"De Beers grouped samples from many EPOs on one application form. The only exception was the 100 tonne consignment from Chikara-01, the 200kg from EPO 1,059 and 200kg from EPO 1,062. They only reported the discovery of diamonds three years after, and when illegal miners had invaded the area," the report said.
In October, Mpofu indicated that he had instructed his legal teams to prepare a case against De Beers.
"Where are the diamonds taken (by De Beers) from 50,000 people in Marange?" he queried, referring to thousands of illegal diamond hunters who flooded the EPOs in 2006 before a government crackdown to restore order.
"They (De Beers) were there for 15 years, they didn't say they found diamonds in Zimbabwe. It does not take five minutes to find diamonds in Marange. When the government started asking (questions), they (De Beers) left. Their withdrawal was so sudden. All the diamonds are not accounted for. They exported not hundreds but thousands of tonnes of diamonds (without Kimberley Certification)," Mpofu said.
Mabusela said: "There can be no KP (Kimberly Process) certificate issued for a prospecting sample or a kimberlite sample as the KP certificate is only applicable to diamonds themselves".
Two months ago, one of about four ministers who dealt with De Beers from 1993, told Companies & Markets that suspicions on the exploration surfaced before Mpofu arrived at the ministry in 2009.
"I was the first to summon De Beers," the former minister said, declining to be named.
"We felt that their (De Beers) operations were suspicious, we had the evidence," he added.
A report compiled by the Zimbabwe Environmental Lawyers Association (ZELA) chronicling a long history of lack of transparency in Zimbabwe's mining sector claimed that diamonds had been discovered in Marange around 1994, but De Beers kept quiet until affirmative action policies forced it to employ local geologists.
The report, released in September, alleged that Zimbabwean geologists were later to spill the beans.
ZELA, a strong critic of Mpofu's policies, alleged that thereafter, Marange villagers and Zimbabwean geologists pressured government to act on a secret diamond processing plant at Bezel Bridge.
"Some former De Beers workers instructed locals to start panning diamonds which they would buy every two weeks and this signaled the beginning of illegal panning activities," said ZELA, which has interviewed local communities.
Centre for Research and Development director, Farai Muguwu, said in a report released last month government had failed to keep a tight grip on leakages.
"It appears government has limited information regarding the volume of mineral wealth hidden underground," Muguwu, a fierce critic of government intervention in the Marange diamond fields, said.
"Foreign companies such as De Beers, which did extensive exploration in the 1960s, appear to possess more information," he added.
Gift Chimanikire, the Deputy Minister of Mines, said he had not yet gone through the report by their investigators, but indicated that De Beers had exported diamonds and not just ore samples.
"Those reports are also with the RBZ (Reserve Bank of Zimbabwe). You can also check with them," said Chimanikire.
