Economic Empowerment in Namibia - September 2011

The Government of the Republic of Namibia (GRN) has a long term objective of ensuring that all its citizens benefit from the growth and development of the mining industry in the country.  It has taken tangible steps over the last few years to achieve this objective by asking companies to:

• Ensure equity participation in mining projects by previously disadvantaged Namibian individuals (also loosely referred to as Black Economic Empowerment or BEE); and
• Commit to empower people impacted by mining projects by investing in social upliftment programmes in the wider community (Broad Based Economic Empowerment or BBEE).

In addition the GRN established a state-owned mining company, Epangelo Mining Company (Pty) Ltd (Epangelo), to directly participate in the mining industry. It is envisaged that over time, Epangelo will play a greater role in the development of the country’s strategic minerals, which include uranium, copper, gold and zinc.

RUN is supportive of the GRN’s empowerment objectives and has therefore implemented a BEE and BBEE charter which has been approved by the Ministry of Mines and Energy (MME).  In accordance with its charter, RUN has executed an agreement with Oponona Investments (Pty) Ltd (Oponona) to achieve both its BEE and BBEE objectives.  Under the agreement, Oponona has the right to acquire a 5% interest in all projects developed on any of RUN’s 100% held Exclusive Prospecting Licences (EPLs) at historical cost which may be funded out of profits.

Oponona’s directors are highly regarded in the Namibian community, having been successful at the highest levels of business and politics:

• Ambassador Monica Ndiliawike Nashandi:  Ambassador Nashandi currently works in the Private Office of the President as Deputy Executive Director.  She has extensive international experience having worked for over 20 years at the United Nations.  She was Namibia’s ambassador to the Nordic countries and High Commissioner to the United Kingdom.
• Dr Ben Mulongeni:  Dr Mulongeni is a veteran journalist and political scientist and is currently the Director of Planning and Development at the Khomas Regional Council.  He was Namibia’s longest serving Director General of the country’s public broadcaster and also served as Secretary to the National Council.
• Mr Jason Nandago:  Mr Nandago is the Managing Director of Metropolitan Namibia, which has been a major player in the local life insurance industry for over 40 years.  Previously he was an Executive Director at Standard Corporate and Merchant Bank Namibia and at Norwich Investments Namibia. He started his career in research at the Bank of Namibia.

Historic signing ceremony between Oponona and Reptile

Front: Ambassador Monica Nashandi and Dr Ben Mulongeni
Rear: Mr Jason Nandago and Dr Leon Pretorius.

A key component of the agreement with Oponona is the requirement to establish a community trust that will be overseen by its Directors.  This trust will receive 40% of all income received by Oponona from its 5% equity position in RUN’s projects.  A commitment has been made to start funding the trust immediately after first sales are made and the income to the trust will be distributed to the local community to assist with education and general community upliftment programmes.

On RUN’s 65% owned Nova Energy (Namibia) (Pty) Ltd joint venture EPLs, its BEE partner is Sixzone Investments (Pty) Ltd which holds a 10% share of the established joint venture with Toro Energy Ltd’s Namibian subsidiary Nova Energy (Africa) (Pty) Ltd holding the remaining 25%.