Vice President Saulos Klaus Chilima is said to have pocketed US$500,000 from businessman Abdul Mahomed to facilitate renewal of contract for Nyala Mines Limited for them to reclaim mining rights of rubies and sapphire on Chimwadzulu Hill in Ntcheu.
Nyala Mines, owned by Abdul Mahomed, has been fighting government in courts since 2018 when their 10-year mining license was not renewed by authorities due to flouting of tax and mining regulations.
The license was given to Mwalawanga Mining Company.
All these years the company has been in court seeking legal remedy but to no avail.
Now Mohamed has found SKC to be his soft spot in the Tonse Alliance regime for company to get his license renewed.
Sources at Mahomed’s office in Limbe say the Vice President received his cut upon promising to push for the renewal at Ministry of Mining.
“The Vice President got the money weeks ago and has promised our boss that our license will be renewed and we will return to Ntcheu within months,” said our source.
Nyala Mines – a public-partnership company, with a minority government stake – changed hands in 2013 when Mohamed bought 80 percent stake.
But their operations were questioned by government for failure to comply to regulations.
The fight between Malawi government and Nyala Mines Limited has been a public spectacle for over a decade now.
The company’s poor track record can also be traced all the way back to 2013 when Mahomed had just bought it.
A letter dated March 10 2013 written by Kalindekafe, addressed to Nyala Mines Limited Mahomed, warned the company that government was seeing no merit in the agreement with the company.
“I refer to the above mentioned subject. I write to inform you that the mining operations by Nyala Mines Limited have been unsatisfactory since the company started operating the mine. These have included undervaluation and under declaration of ruby and corunclum gemstones mined on Chimwadzulu Hill during reduction and exports of the said minerals. This has
resulted in loss of revenue by government which has not benefited from the mine despite production being underway. These violations of the Mines and Minerals Act have made it difficult for us to continue justifying your holding of the tenement,”
In 2018, a study by a joint government and civil society initiative on transparency known as Malawi Extractive Industry Transparency Initiative (Mweiti) accused the company of non-compliance on agreements and tax obligations.
The company, however, denied the allegations and rushed to court for redress.
Observers have argued that with such a trail of inefficiencies Nyala Mines is not suitable to be mining in Malawi.
Chilima, however, seems to have renewed their hope and he will do anything to reclaim their license having been palm-oiled with $500,000.