UPDATE:Zimbabwe Mines Minister: No Intention Of Canceling Licenses

Zimbabwe's mines minister Wednesday said his department has "no intention" of canceling mining licenses in connection with ongoing negotiations between the government and mining companies over the implementation of the country's indigenization law.

"We have no intention of cancelling any licenses. There are some negotiations taking place with some parties. No license has been cancelled. We have no such intentions," Obert Mpofu told the Zimbabwe Mining Indaba, or meeting, in Harare.

Mpofu is the mining licensing authority in Zimbabwe.

The indigenization law, enacted in 2008 but only being more forcefully implemented now, requires multi-nationals to sell a 51% stake in local assets to designated black-owned entities.

This week the country's minister of youth development, indigenization and empowerment, Saviour Kasukuwere, and David Brown, chief executive of Zimplats Holdings Ltd. (ZIM.AU), Zimbabwe's largest platinum miner, said in a joint news statement that they had reached a compromise over the firm's plan.

That follows threats from Kasukuwere this month to revoke the miner's license.

Other companies such as banks and food producers are also carrying out their negotiations on how to apply the law.

"We have had our running battles with the mining industry," Kasukuwere said Wednesday at the mining event. "But now we have made tremendous progress. In the past few weeks we have made good progress...Zimplats is a major player and we have agreed on a plan. At the end we want a win-win situation."

The uncertainty over what will happen around the indigenization has caused mining investment to stall, with many miners keeping operations running and putting expansion plans on hold.

Mpofu also said that 400 firms have applied to mine diamonds in the country and some have been approved.

-By Farai Mutsaka, contributing to Dow Jones Newswires; +263 913 245 860; fmutsaka@yahoo.com

(Devon Maylie in Johannesburg contributed to this article.)

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