[miningmx.com] — THE Hawks on Wednesday raided the offices of the department of mineral resources (DMR) and Imperial Crown Trading (ICT) as part of an investigation into the ministry’s decision to award ICT a 21.4% prospecting right over Kumba Iron Ore’s Sishen mine.
McIntosh Polela, Hawks spokesperson, said the raids centered on the DMR’s national offices in Pretoria and its regional offices in Kimberly, which oversees minerals rights in the Northern Cape province.
“It is alleged that certain individuals from the DMR were involved in fraudulent issuing of prospecting rights,” Polela said in a statement.
The police raid is the latest twist in a saga that has dented investor confidence in the key sector.
Police also hit the offices of ICT.
Polela said the operation followed criminal charges lodged by Kumba Iron Ore, adding that the police seized documents which will be used for further investigations.
“We are busy investigating charges of forgery, uttering, corruption and fraud. In simple terms, these relate to among others, falsifying of documents,” he said.
A spat among Kumba, ICT as well as ArcelorMittal SA (Amsa) started when the steelmaker’s 21.4% mineral right at Kumba’s Sishen mine lapsed in 2009. Kumba owns the remaining 78.6% right and had applied for Amsa’s lapsed right. The prospecting right was, however, awarded to ICT.
The iron ore producer has since applied to court to review the ministry’s decision. The case will be heard in August.
The DMR confirmed the investigation and said it was fully cooperating with police.
ArcelorMittal said in August 2010 it would buy ICT for R800m, effectively to once again gain control of its lost slice of the mine and reinstate a lost preferential iron ore supply agreement with Kumba. However, it has since asked the North Gauteng High Court to join Kumba as an applicant to have ICT’s right set aside.
The proposed acquisition sparked furious allegations of corruption in the mining ministry because it also involved the transfer of a quarter of the steel-maker’s shares to black investors, including ICT and an investment group which included the son of President Jacob Zuma, Duduzane.
