Zambia’s Gold Rush Chaos – Hunters of Gold/Part I

President Hakainde Hichilema’s plans to make Zambia a global gold-mining hub are being thwarted by two main players: illegal miners bent on exploiting the country’s gold reserves and an influential private company, MakanDay can reveal.

By Chishaba Masengu and Charles Mafa 

A dispute has arisen over gold exploration rights in Kabombo, an area in Rufunsa district, east of Lusaka. Various local cooperatives are staking their claim to the land – which is problematic enough – but what raises the most ire and concern is the power and influence exerted by mining company Gold Hunters over government oversight entities and gold deposits in the region. 

In 2015 in the same area, a fierce land dispute erupted between Chief Shikabeta of Rufunsa in Lusaka Province and Chief Chembe of Luano district in Central Province over gold deposits, with both asserting ownership of the land. Despite being in different provinces, both chiefs claimed rights to the gold-rich area, leading to tension among their subjects.

The current tension is between Gold Hunters, a private company holding a small-scale mining licence in Kabombo, and several local cooperatives that were also granted artisanal mining licences for the same land. This overlap has heightened the dispute between the company and the local population.

A government-convened meeting was held on 8 July to address local concerns about ongoing disputes. At that meeting, local cooperative leaders questioned why Gold Hunters was exerting undue influence over the mines. 

Chief Shikabeta’s absence from the meeting was notable, promptingquestions about his commitment to ensuring that his subjects would benefit from the minerals. It also supports allegations from his subjects about his having close ties with the company.

The chief refused to answer any questions from MakanDay, urging the journalist to appear before him at his palace in Rufunsa. He had initially asked for the questions, saying he would only respond later as he was on the road when contacted.

“I think we have never met each other before, and this is the first time you are talking to me on the phone. How do you expect me to answer such questions on the phone? If you have respect for me as a chief, you must come to the palace to talk, not on the phone,” he said.

Back to the meeting. It was organised by Richard Mabena, District Commissioner for Rufunsa district. In attendance were Alex Mapushi, the Deputy Permanent Secretary of Lusaka Province, and Carthbert Kateya, a cooperative officer in the Ministry of Small and Medium Enterprise Development.

Other attendees included Bishop John Mambo, who is Senior Headman Nyampande in Chief Mpanshya, and Charles Chibulo, the chairman for the Chief Mpanshya chiefdom.

Representatives of the Velos Group of Companies pledged up to $20 million for a mining project, and Mosheberi Mining Limited committed over $10 million in partnership with artisanal cooperatives.

Bishop Mambo revealed that some local and central government leaders had been compromised, and this had enabled private companies to exploit the situation with impunity.

“Gold Hunters has caused some problems. That’s where you can smell corruption. Let’s expose that. It’s for the good of the entire country,” he said. “We need to address this situation to avoid the emergence of small militias sprouting through this trade.”

A MakanDay investigation has found that although artisanal miners dominate the extraction of gold in Rufunsa, they often face exploitation from private interests, including Gold Hunters.

According to a source familiar with gold mining in Kabombo, another company was active in gold mining before the 2021 elections and was later succeeded by Gold Hunters.

The emergence of this company has drawn attention to extensive networks connected to illegal gold mining. 

It is alleged that these networks involve politicians associated with former ruling party the Patriotic Front. It appears that some of these individuals have now been replaced or have established connections with officials linked to the ruling United Party for National Development.

“It appears that the same individuals [from the previous company] simply rebranded the company,” said a source. 

Gold Hunters Mining Limited

The majority shareholder in the company is Somali national Abdirahman Artan Isse, who holds 70% of the shares. Among the Zambian stakeholders, Chomba Shikabwali possesses 11.5% shares, Mike Simukama also holds 11.5%, and Alian Chipote has 7.3%, collectively constituting 30% of the shares.

The company, based in Northmead, Lusaka, was established on 27 January  2023. Its primary activities comprise the mining of non-ferrous metal ores and the wholesale trading of metals and metal ores.

The MakanDay Centre for Investigative Journalism’s attempts to offer Gold Hunters a right of reply and to obtain an explanation from them have been unsuccessful. When company representatives met with a MakanDay journalist on 8 July, they resorted to threats and intimidation, accusing the journalist of being sent by individuals opposed to Gold Hunters.

Local concerns

Adding to the complexity of mining operations is the government’s directive for local cooperatives to partner with investors, the aim being to benefit communities in mining areas.

According to a source in Rufunsa, some of the local cooperatives partnering with Gold Hunters were allegedly set up by the company itself. MakanDay has not independently verified this claim.

It appears that certain government officials within President Hakainde Hichilema’s administration are now backing the company.

During a ceremony held in Rufunsa on 12 June, attended by Minister of Lusaka Province Sheal Mulyata and other senior officials, Minister of Mines Paul Kabuswe issued artisanal mining licences to several cooperatives. Interestingly, some officials at the event were encouraging cooperatives not associated with Gold Hunters to collaborate with the company.

Artisanal miners allege that Gold Hunters wields considerable power and continues to exploit artisanal miners by using them as cheap labour. This contravenes government policy, which is aimed at empowering artisanal mining through the formation of cooperatives.

Mining cadastre map portal

A review of the Zambia mining cadastre map portal (https://portals.landfolio.com/zambia/) reveals that Gold Hunters holds a maximum of five licences, including three small-scale exploration licences, one small-scale processing licence, and a small-scale mining licence for Rufunsa district.

Further inspection of the portal indicates that, besides other licences applied for and granted nine months later in March 2023, Gold Hunters applied for its mining licence on 18 March 2024, and remarkably, obtained it four weeks later on 17 April. 

This action blatantly disregards the 90-day rule process, which mandates that an environmental impact assessment be conducted before mining can commence.

Huge contrast

In contrast, the portal shows that the state-owned Zambia Consolidated Copper Mines – Investments Holdings (ZCCM-IH) applied for a similar licence on 11 September 2023 and only received approval nine months later on 7 May 2024.

The company has now been granted a licence to conduct explorations in an area called Kamwesha in Rufunsa, about 100km from Kabombo.

Government’s silence on mining licence approval

The Ministry of Mines and Minerals Development has not responded to MakanDay’s request for comment on several questions, including the expedited approval of Gold Hunters’ mining licence.

ZCCM-IH’s gold subsidiary, the Zambia Gold Company, was founded in 2020. It was established to bolster the development of Zambia’s gold sector and broaden the mining portfolio of the state-owned company, which has traditionally focused on copper.

Its responsibilities include the exploration, processing and marketing of mineral resources, with the primary objective being to sell gold to the Bank of Zambia. This strategic move aims to bolster the kwacha by augmenting gold reserves.

According to ZCCM-IH public relations officer Loisa Mbatha-Kakoma,  the company intends to apply the same operational model to the Kasenseli gold mine in Mwinilunga once the mine starts operations later this year.

The operational model involves collaborating with artisanal miners to facilitate safe gold mining.

Mbatha-Kakoma detailed ZCCM-IH’s plan to partner with the Ministry of Mines in order to evaluate the artisanal mining sector and aid miners in forming cooperatives to obtain artisanal licences.

“This time, it will be at different levels that we intend to partner with small-scale licence holders to explore and develop mines. We also intend to undertake gold aggregation from artisanal miners, which means the formalisation of the sub-sector,” she explained.

She said the fact that Zambia Gold Company now owned its own licences (without partnerships) would give ZCCM-IH more operational leverage.

Additionally, the company aims to collaborate with the Ministry of Commerce to procure appropriate mining equipment for these cooperatives and facilitate the sale of their gold through Zambia Gold Company.

In pursuing this initiative, ZCCM-IH will encounter competition from private entities like those in Rufunsa, as well as from artisanal miners themselves, who may prioritise financial gain over safety, sometimes at the cost of their wellbeing – and even their lives.