Epangelo Cannot Have Mining Rights – Koep

THE preferential mineral rights given to the State mining company, Epangelo, has no legal standing, Windhoek-based lawyer, Peter Koep has argued.

Epangelo was formed in 2008 following a study done by the United Nations Institute for Namibia as part of United Nations General Assembly Resolution 37233 before independence. The study recommended that Namibia needed a public enterprise to effect changes as part of its restructuring exercise.

Government created Epangelo to pursue some of the study’s recommendations among them participating in mining and mineral resource development preparing of feasibility studies and promoting projects and coordinating mineral resources and industrial development for the benefit of other ministries responsible for the manufacturing and energy industries.

He said although there is no law “which says Epangelo has the preferential rights to these minerals but it has been implemented”.

“It is implemented because that is what Government wants. Why do they not pass a law? They need a law. Cabinet cannot make laws, parliament makes laws. Cabinet is the executive. Cabinet executes laws, it does not make laws,” said Koep, who attended the recent Mining Indaba held in Cape Town.

Koep said although every country is entitled to have a state mining company, he doubts if Epangelo will ever succeed because it does not have the necessary funds to carry out all the activities.

“I doubt if it will ever be successful. I think it will continue to cost the taxpayer money because Epangelo does not have funds to participate in large transactions,” he said.

Epangelo Managing Director Eliphas Hawala said yesterday that the decision to award the exclusive rights to the company was a policy decision by the Cabinet and that the role of the company was to execute government policy.

Epangelo would also ensure that Government policies regarding mining and mineral resources development, within the context of the development of the

national economy as a whole, are implemented.

Above all, Epangelo was given preferential rights to strategic minerals such as diamonds and uranium, but Koep said this decision should have been followed by the passing of a law.

Koep is the senior partner of Attorneys Koep amp Partners which concentrates on mining, corporate and commercial work, as well as High Court litigation.

He served as the chairman of Namibian Stock Exchange for a number of years as well as director at Ohorongo Mining (Pty) Ltd director of Xemplar Energy Corp. and was the president of Namibia Peace Plan 435, which worked for the implementation of United Nations Resolution 435 of 1978 leading to the independence of Namibia.

In addition, Koep was a member of the President’s Aisory Committee on Economic Affairs.

Finance minister Saara Kuugongelwa-Amadhila allocated N$49 million to Epangelo over the next three years, something which made former Prime Minister Nahas Angula who was instrumental in the setting up of the mining company during his tenure to argue that the State should capitalise Epangelo instead of Air Namibia.

“If you really want to participate in the economy, you must capitalise Epangelo mining, so that they can go into balanced partnerships,” Angula said during his contribution to the debate in Parliament on the 201415 budget.

Koep further said a regulatory body should have been set up to oversee the awarding of mineral rights including those that are awarded to Epangelo.

“The problem is that the shareholder is the State and it is the shareholder that allocates the rights to Epangelo. In terms of law that is questionable. You cannot have the decision maker make a decision to grant itself a licence,” he explained.

“Epangelo, in administrative law, seems biased. You need a regulatory body that is independent and decides which licences should be allocated to Epangelo and what should not be allocated. At the moment, what they do is that Epangelo has the first rights but nobody knows how they would have gotten it,” Koep further argued.

He said this preference usually results in investors having “to sit and wait and are forced to enter into agreements with Epangelo”.

Koep likened Epangelo to Seaflower, a State-owned fishing company that was created shortly after independence, which he described as “a disaster”.

“It never showed profits. The State, through Seaflower, awarded itself fishing quotas. You cannot do that. If preference needs to be given to somebody, it must be regulated. We must regulate better and make conditions of investment clear. We must not lure investors here and then confront them with a situation which is not tenable,” he said.

Koep also said the moratorium on phosphate mining, declared by Government last year has “no legal” standing.

“In many instances, people think they have powers, which they don’t have. If you ask the fisheries minister where the moratorium is, he won’t show it to you. The minister of mines won’t show it to you either because there is no moratorium. If that is what the Government wants, why didn’t they follow the right procedure to get that moratorium on the books? At the moment everybody thinks there is a moratorium but legally there is no moratorium,” he said.

Source : The Namibian