STAFF WRITER
A report released by the Auditor General has flagged three gold mining companies operating in Namibia for failing to meet expected standards on local empowerment, ownership as well as sticking to some aspects of their Exploration Prospecting Licenses (EPLs).
The report by Auditor General Junias Kandjeke focused on the compliance of QKR Namibia Navachab Gold Mine and Osino Gold Exploration.
Kandjeke said his findings highlighted several areas of non-compliance and areas requiring improvement.
“The audit found that QKR Namibia Navachab Gold Mine did not comply with Section 50 (for the 2020/21 and 2021/22 financial years. Both QKR and B2Gold Namibia did not meet Section 50 (e) requirements, concerning cooperation with industry players to aid Namibian citizens in skills and technology development,” Kandjeke said.
The audit found that out of 13 EPLs reviewed, seven adhered to renewal regulations, while six exceeded the 7 year renewal limit without the necessary ministerial approval.
“Additionally, the required reduction of exploration area upon renewal was not implemented.
The audit found that QKR Namibia Navachab Gold Mine company structure on file was 92,5 percent owned by Multinational and 7.5 percent owned by a Namibian company.
However, information on beneficial ownership of 92,5% was not provided for audit evidence,” he said. He also flagged the company for last submitting a poverty eradication strategy in 2016, a situation he says may not be applicable to the current extractive industry environment.
“The audit found that B2Gold Namibia company structure on file was 90 percent Mauritian and 10 percent Namibian owned, however their response indicate 90% Canadian whilst information on beneficial ownership of 90% was not
provided for audit evidence. Furthermore, the management representation structure and poverty eradication strategy information were not available due to non-retrospective
application of conditions,” Kandjeke said.
The Auditor General also expressed reservations about the delay of Osino Gold Exploration and Mining’s acceptance of additional conditions beyond the one month notice period. Furthermore, no ministerial approval for late submission was provided as required by the Act.
“The proposed Namibian shareholding structure is pending approval. It is however, unclear how Namibians as holders of 10% shares in the New Osino Co. will derive maximum benefit
compared to the 90% shareholding that is retained by OGEM and its numerous subsidiaries. This may in turn have an impact on the profit-sharing and revenue collection,” he said.
RECOMMENDATIONS
Kandjeke recommended that the Ministry of Mines and Energy implement enhanced compliance and ensure strict adherence to renewal regulations and reduction of exploration areas, and regularly update company records.
The Auditor General also wants the ministry of mines to provide comprehensive documentation to support responses and maintain up-to-date records. “Enforce policies on local beneficiation and capacity-building more rigorously to promote sustainable development and attract foreign investment,” he said.
COMMENTS