UPDATE: South Africa's ANC To Research Mine Nationalization

South Africa's ruling party will appoint researchers to investigate the viability of nationalizing the country's mines, although the mining minister said Monday it wasn't government policy even though the matter would continue to be debated.

The African National Congress plans to name two senior researchers and a project manager to look at successful models that could be considered, local media reported, citing comments from party General Secretary Gwede Mantashe.

A report will be presented to the party's National Executive Committee ahead of a major policy conference in 2012, he was quoted as saying.

The ANC, which has ruled since the election in 1994 of the country's first black president, Nelson Mandela, at a party conference in September decided the issue of nationalization would be researched after repeated calls for the state to take control of mines by the ANC's youth wing.

Susan Shabangu, minister of mineral resources, told reporters in Pretoria that nationalization wasn't government or ANC policy, but the party had agreed the matter would be discussed. Shabangu at a mining industry conference in February had said nationalization of mines wouldn't happen in her lifetime, earning her criticism from the ANC Youth League which has championed nationalization as a way of spreading mineral wealth in the country to tackle widespread poverty.

South Africa is the world's leading producer of platinum and ferrochrome, and a significant source of gold and other minerals. Mining is a major contributor to the country's economy and directly employs about 460,000 people, according to government data.

Lonmin PLC (LMI.LN) in Monday said the vocal calls for nationalization do little for investor confidence. "But we are encouraged by the steadfast position that key government ministers, senior leaders within the ANC and other industry participants such as the National Union of Mineworkers have taken in arguing the weaknesses and dangers for South Africa's economy of a policy of nationalization," the platinum producer said.

A spokesman for the ANC wasn't immediately available to comment.

-By Robb M. Stewart, Dow Jones Newswires; +27 11 783 7848; robb.stewart@dowjones.com

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