Divided opinions over potential Zimbabwe mining boom 3rd September 2010

Zimbabwe may not be on the verge of another mining industry boom, according
to one company with several interests in the country.

With rich deposits of platinum and other minerals, government departments
and investment firms have been trumpeting Zimbabwe's potential explosion as
a production hub.

However, DRA Mineral Resources, a South African project management and
engineering group involved with the Unki, Mimosa and Ngezi mines, has
offered a more cautious assessment.

Director for Project Services Rodney Drew explained that it is not clear
whether a boom will happen in the near future as Zimbabwe's policy and
revival strategy following its financial crisis are "still on the drawing
board".

"The Zimbabwe government is still getting back on its feet after the turmoil
of the 2006 to 2008 economic meltdown," he said in an interview with Mining
Weekly.

"But, since Zimbabwe has decided that the mining industry is key to its
recovery, we don't think it will be too long before everything falls into
place, opening the way for new mines to be constructed."

Mr Drew also explained that a number of bureaucratic hurdles are impacting
on companies' plans to expand or bring their mining operations to Zimbabwe.

He noted that the Zimbabwe Revenue Authority and the Zimbabwe Immigration
Ministry are putting pressure on both indigenous firms and their foreign
contractors.

And with taxes remaining sky-high in the country - it has not signed a
double tax agreement with South Africa since 1965 - Mr Drew claimed that
mining projects are less appealing at present.

"DRA used to be able to brag that it could build a process plant more
cheaply in Zimbabwe than it could in South Africa, but this is no longer the
case," he added.

Meanwhile, a more bullish assessment was offered by Victor Gapare, President
of the Zimbabwe Chamber of Mines, who predicted that the country's mining
industry could grow by as much as 30 per cent in 2010.

He also suggested that this figure could increase in 2011, assuming the
Zimbabwe Electricity Supply Authority does not experience problems and more
power plants are constructed.

"As much as $160 million was spent by mines on local procurement in 2009 and
this is projected to increase threefold in 2010 and significantly more in
2011 and beyond," he told the news provider.

"The mining industry is on the verge of a mining boom, particularly if
government retains the current mining fiscal regime and improves the
investment climate, which is competitive and can attract the risk capital
for exploration that is key for mining development."

Mr Gopare also claimed that the easing of the economic restrictions in
Zimbabwe should allow it to properly capitalise on favourable international
pgm prices for the first time.

Meanwhile, Zimplats, which is operated by Impala Platinum, revealed last
month that its pgm output in concentrate increased from 93,845 oz to 95,144
oz in Q2 2010 on a quarter-on-quarter basis.