Tag Archives: Mawarid Mining

Failing seabed miner Nautilus Minerals continues on life support

Nautilus Minerals remains in a critical financial state, able to survive only because of another short-term loan from its main shareholders…

Press Release | GlobeNewswire | Business Insider | January 11, 2018

Nautilus Minerals Inc. announces that it continues to arrange bridge loans from Deep Sea Mining Finance Ltd, which are expected to form part of a larger secured structured credit facility of up to US$34 million to be provided by the Lender to the Company.

In conjunction with initial advances under the bridge loans, the Company has issued to the Lender an additional 8,591,065 warrants of the Company, for a total of 11,812,714 share purchase warrants issued to the Lender to date. Each Warrant entitles the Lender to purchase one common share of the Company at a price of C$0.17 for a period of five years from the date of issuance of the Warrant.

The bridge loans, which the Company expects to be in the amount of up to US$7 million, will assist the Company’s immediate working capital requirements and facilitate payments required to continue the development of the Company’s seafloor production system to be first utilized at the Company’s Solwara 1 Project. The loans bear interest at 8% per annum, payable bi-annually in arrears with a one year maturity date.

The Company will be entitled to pre-pay each loan prior to maturity, by paying 108% of the outstanding principal of the loan plus accrued and unpaid interest. Each loan will be represented by a promissory note and will initially be secured against the assets of the Company through a general security agreement. The Lender may subsequently require the loan to be guaranteed by the Company’s material operating subsidiaries and secured against the assets of such subsidiaries.

There can be no assurance that the Company will be successful in concluding the larger credit facility transaction or that any further funding will be secured by the Company.

As previously disclosed, the Lender is a private company owned 50% by each of: (i) USM Finance Ltd, a wholly owned subsidiary of USM Holdings Ltd, an affiliate of Metalloinvest Holding (Cyprus) Limited; and (ii) Mawarid Offshore Mining Ltd., a wholly-owned subsidiary of MB Holding Company LLC. As the Lender is controlled by two insiders of the Company, the Lender is a “related party” of the Company and the loan transaction constitutes a “related party transaction” of the Company under MI 61-101 Protection of Minority Security Holders in Special Transactions. The transactions comprising the bridge loans and the Warrants will be exempt from the formal valuation and minority shareholder approval requirements of MI 61-101.

The Company did not file a material change report more than 21 days before the expected closing of this transaction, as the details of the transaction were not finalized until immediately prior to the closing and the Company wished to close the transaction as soon as practicable for sound business reasons.

The Company requires significant additional funding in order to complete the build and deployment of the seafloor production system to be utilized at the Solwara 1 Project by the Company and its joint venture partner (as to 15%), the Independent State of Papua New Guinea’s nominee.

There can be no assurances that the Company will be successful in securing the necessary additional financing transactions within the required time or at all. Failure to secure the necessary financing may result in the Company undergoing various transactions including, without limitation, asset sales, joint ventures and capital restructurings.

The Company will provide further updates as circumstances warrant.

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K1bn needed for Solwara 1

Cedric Patjole | PNG Loop | October 14, 2017

More than K1 billion in remaining project financing is needed to fund the Solwara 1 Project in New Ireland Province.

Nautilus Minerals Inc. revealed this when announcing the appointment of its exclusive financial advisor – Deep Sea Mining Finance Ltd (DSMF).

In a statement, the Canadian company indicated that a remaining project financing of US$350 million was needed, which DSMF will be leveraging, to complete the build and deployment of the sea oor production system to be utilised at the Solwara 1 Project.

Nautilus said DSMF will seek to leverage the international expertise and financial relationships of Nautilus’ two major shareholders to assist in advancing the development of the project.

Nautilus has stated that there are no assurances that it will secure the necessary additional funding and a failure to do so may result in it undergoing various transactions, which include asset sales, joint ventures and capital restructurings.

DSMF is a newly-incorporated private company in the British Virgin Islands.

Nautilus has also announced that it has terminated a ‘Bridge Financing Agreement’ signed in 2016 with Metalloinvest Holding (Cyprus) Limited and Mawarid Offshore Mining Ltd.

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Namibian Chamber of Commerce against experimental seabed mining

Concept art of bulk cutter. Image: N.R.Fuller

Kenya Kambowe | Namibian Sun | 4 November 2016

The Namibia Chamber of Commerce and Industry (NCCI) northern branch has condemned the mining of phosphate off the Namibian coast, saying that the interest of Namibians should always come first.

The northern branch also slammed the issuing of the marine phosphate environmental clearance certificate to Namibian Phosphate Mining (NMP) by the environmental commissioner Teofilus Nghitila.

The certificate was subsequently withdrawn by environment minister Pohamba Shifeta who has since ordered Nghitila to inform the Ministry of Fisheries and Marine Resources, the fishing industry and all other interested parties to finalise their inputs within three months.

The cancellation comes in the wake of an urgent High Court application filed by several fishing associations citing irregularities in the issuance of the environmental clearance certificate. The NCCI is convinced that marine phosphate mining is a harmful process that poses a great risk to marine ecosystems.

“The extraction of marine phosphate is associated with a lot of possible irreversible destruction which can and will be detrimental to the sea ecosystem, with absolutely no possible mitigation factors,” the statement read.

“The negative destruction ranges from extraction to the end results and it gets worse with every stage of beneficiation.” The statement acknowledges the contribution of the fishing industry to the Gross Domestic Product (GDP) of the economy and its significant role in reducing the high unemployment rate in the country.

Furthermore, the chamber argues that the foreign shareholding of NMP will contribute insignificantly to the Namibian economy. NMP is owned by Mawarid Mining LLC (85%), an Omani company, and Havana Investments (Pty) Ltd (15%), a Namibian company, belonging to businessman Knowledge Katti.

“It is important to note that fisheries contribute immensely to our GDP. It brings in a lot of foreign currency through the export of our fish products, most of which are value-added products. Through the value addition, a lot of employment opportunities are created and a lot of Namibians are employed,” the statement further says.

“It is therefore important to understand that, in the first place, phosphate mining will not benefit our sustainable economic development in the long run; no matter how beautiful the picture might be painted. The biggest stake of the shareholding belongs to the foreigners.”

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Namibian seabed mining approval suspended amid corruption claims

namibia-pohamba-shifeta

Environment and Tourism Minister, Pohamba Shifeta

See also: Nautilus Minerals linked to corruption allegations around Namibian seabed mining

Shifeta suspends NMP phosphate certificate

Albertina Nakale | New Era | November 3, 2016

Environment and Tourism Minister Pohamba Shifeta has ordered that the environmental clearance certificate granted to Namibia Marine Phosphate (NMP) to mine phosphate off Namibia’s coast be set aside for the sake of the public good.

This follows a massive public uproar surrounding the perceived secretive issuance of the certificate, which was granted by Environmental Commissioner Teofilus Nghitila on September 5, 2016.

Critics of the proposed contentious project have demanded updated scientific facts in order to make an informed decision on the issue. The decision of Nghitila to grant the certificate to NMP prompted considerable debate and reaction.

NMP’s Sandpiper project constitutes more than N$5 billion in investment capital and is estimated to yield 1.8 billion tonnes of phosphoric sand. NMP is owned by Mawarid Mining (Namibia) (42.5 percent) and Sea Phosphates (Namibia) (42.5 percent), both wholly owned subsidiaries of Mawarid Mining LLC (85 percent), an Omani company, and Havana Investments (Pty) Ltd (15 percent), a Namibian company.

Shifeta yesterday delivered his more than two-hour ruling in the matter between appellant Michael Gaweseb – who is a trustee of Economic Social Justice Trust – Nghitila and NMP. The hearing was held on October 31, when Gaweseb appealed against the commissioner’s decision to grant the certificate to NMP, based on two reasons: that the activity of phosphate mining has a long devastatingly adverse impact on the marine environment, and lack of public consultation.

Shifeta said he took the liberty to study the facts and all evidence presented before him by the appellant surrounding the issuance of the phosphate certificate.

Although Shifeta said there was no secrecy surrounding the awarding of the certificate – after closely studying the evidence presented before him he reached the conclusion that the certificate granted by Nghitila should be set aside and that the commissioner should notify the Ministry of Fisheries and Marine Resources, the fishing industry and all other interested parties to finalise their inputs in the report within three months. He said that in accordance with Article 95 (1) of the Namibian Constitution, which evidently underlines the importance of environmental protection, he reached his conclusion based on that provision and the cause of the public good.

“That whole process of consultation should be completed within six months from today. That this order is with immediate effect and binds all parties, directly or indirectly affected, unless set aside by the High Court as per section 51 (1) of the Act,” Shifeta announced.

He also agreed with the appellant on the issue of further public consultation, saying caution should be taken to balance the rights of the respondents and the sake of the public good.

“Accordingly, Section 50 of the Act and Regulation 25 as its delegated law should be applied with caution and in a special manner because of the value and obligations Article 95 (1) of the Constitution impose on citizens and residents of Namibia,” he said.

He still maintains that the fisheries ministry failed to respond to the request of the commissioner for a review.

“It is clear that on 13 June 2016, the commissioner’s request made to the Ministry of Fisheries and Marine Resources to review the final report was ignored or not seen necessary to respond to, hence the commissioner’s correct application of Section 44 (2) of the Act (Environmental Management),” Shifeta maintained.

He defended that the Environmental Management Act of 2007 only came into force in 2012, saying it’s a brand-new legislation while the mining licence was issued in 2011.

“I will accept the notion that ‘ignorance of the law is not an excuse’. However, you may agree with me that the fishing industry is a big industry whose contribution to the national economy is very significant. The fishing industry, I assume, was supposed to channel their inputs to the final report for review through their line ministry but the ministry failed to respond to this, for the reason only known to them,” Shifeta said, adding that such failure cannot be blamed on the entire fishing industry.

NMP, in a statement issued on Sunday, challenged critics of its envisaged project to present counter-scientific evidence to back up claims that seabed mining would destroy the country’s marine life.

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Urgent application against Namibian seabed mining approval

namibia

LEGAL BATTLE: An urgent application has been filed in the High Court against phosphate mining in Namibia

See also: Nautilus Minerals linked to corruption allegations around Namibian seabed mining

Ellanie Smit | Namibian Sun | 02 November 2016

An urgent application has been filed in the High Court yesterday against the awarding of the environmental clearance for marine phosphate mining at the coast.

The application was filed by lawyer Sisa Namandje who is acting on behalf of the Confederation of Namibian Fishing Associations.

The urgent application follows after the environmental clearance certificate for Namibian Marine Phosphate’s Sandpiper Project was quietly issued on 5 September and it only came to light more than a month later.

At the time of going to print last night, it was not clear as to when the matter will be heard.

Affected parties had only 14 days to appeal the decision from the date of granting the certificate.

Namandje last week accused environmental commissioner Teofilus Nghitila of committing a number of irregularities and that he had not complied with the Environmental Management Act.

These accusations were contained in correspondence between Namandje and government attorney Mathias Kashindi, who is representing Nghitila after the fishing confederation, demanded through their lawyer, that Nghitila should provide detailed information on the processes followed with regard to granting the environmental clearance.

They wanted to know, among others, the date on which he had received the assessment report from the NMP, as indicated in Section 35 of the Environmental Management Act of 2007, the details and all particulars of the notifications made to the public and interested parties, as well as the closing date for submission contemplates, again in terms of Section 35 of the same Act.

However, after Nghitila provided the information to his lawyer, Kashindi in his correspondence with Namandje admitted that Nghitila had to a certain extent not complied with some of the requirements of the act.

Contradicting remarks

Nghitila has refuted claims of irregularities on his part and expressed concern over the fact that his lawyer had written to Namandje without his consent and provided contradicting information than what was discussed between them.

According to Nghitila, he answered all of the questions that Namandje asked on the process followed in the granting of the environmental clearance.

“I have dealt with questions posed by Namandje in my response as prepared for discussion with the government attorney. All evidence and documentation have been provided,” he said.

Nghitila has also expressed his concerns to the Attorney-General Sacky Shanghala and the Minister of Environment of Tourism, Pohamba Shifeta with regards to this misrepresentation by the government lawyer.

Some of the issues pointed out by Nghitila were that the issue of phosphate mining was discussed at a Special Cabinet Committee on Trade and Economic Development meeting of 15 February 2016.

He said that the environment ministry was given three months to pronounce itself on the matter with regard to the two mining licenses that have been issued for offshore phosphate mining.

According to him, at a meeting of 1 June, the environment ministry requested the deferment of the matter to allow technical consultation with the Ministry of Mines and Energy and the Ministry of Fisheries and Marine Resources.

At a meeting on 11 August Nghitila gave a presentation at which a notice was given of the decision as regard to ML 170 of Namibia Marine Phosphate.

He said that both ministers of mines and fisheries were part of this meeting.

The meeting agreed that Nghitila be granted the independence to decide on the matter as per the provisions of the Environmental Management Act.

“This served as notification to the competent authority, mines ministry and fisheries ministry,” said Nghitila.

He added that the notification of the application and requests for written comments were made through the company on 17 April 2012 and a number of notices were made inviting the public for public meetings.

With regards to the fact that Nghitila did not advise all interested parties, including fisheries associations of his decision to grant environmental clearance, he said Section 37 of the Act and Regulation 18 refer that only notifying the proponent and competent authority is required.

Nghitila also responded to claims about the review process that was not followed, saying that this already started in 2012 after the Environmental Impact Assessment report was submitted.

He said this review process included consultation with both the fisheries and mines ministries including ordering the company to do the verification study. After the submission of the verification studies, which forms part of the EIA Report, Nghitila satisfied himself with the report and consultation with the relevant ministries were undertaken which culminated in a workshop held on 27 April 2016 in Swakopmund.

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Nautilus Minerals linked to corruption allegations around Namibian seabed mining

nautilus

The giant machines Nautilus wants to use to mine the seafloor in Papua New Guinea

PNG Exposed | 31 October 2016

Prospective Solwara 1 seabed mining company Nautilus Minerals can be linked to the allegations of corruption surrounding a controversial decision by the Namibian government to allow seabed mining.

Namibia’s Fisheries Minister, Bernhard Esau, is crying foul over a government decision to allow phosphate mining on the seabed.

He says the decision to grant an environmental permit to Namibian Marine Phosphate was done behind closed doors and in defiance of an earlier government imposed ban. As Fisheries Minister, he says he was denied an opportunity to present his own proposal for a detailed 3-5 year environmental study before any approvals were granted.

Namibian Marine Phosphate is owned by the same company, MB Holdings, that is the largest shareholder in Nautilus Minerals.

MB Holdings owns 85% of Namibian Marine Phosphate through its wholly owned subsidiary, Mawarid Mining LLC.

MB Holdings is owned by Omani business man Mohammed Al Barwani.

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Namibian Fisheries Minister wants phosphate mining clearance withdrawn

Corruption allegations threaten to sink experiemental seabed mining approval in Namibia

shifetaesau-namibia

Shinovene Immanuel | The Namibian | 27 October 2016

FISHERIES minister Bernhard Esau wants Cabinet to instruct the environment ministry to immediately withdraw the environmental clearance certificate issued to Namibia Marine Phosphate.

Esau’s rejection of the phosphate project and recommendations are contained in a draft report obtained by The Namibian this week which proposed a detailed study on marine phosphate mining over three to five years.

The minister wanted to make an urgent submission to Cabinet on Tuesday, but his attempt was blocked, possibly by the powerful group in Cabinet and some state officials who support phosphate mining.

The report also shows how Cabinet resolutions adopted by former President Hifikepunye Pohamba’s administration in 2013 were ignored when the ministry of environment approved an application to mine phosphates from the bottom of the ocean.

Efforts to get comment from Esau were not successful as his mobile phone was unreachable.

Environment minister Pohamba Shifeta and economic planning minister Tom Alweendo said the matter was not discussed at Cabinet this week.

Environmental commissioner Teofilus Nghitila issued an environmental clearance certificate to Namibia Marine Phosphate (NMP) on 5 September 2016.

Nghitila based his judgement on a secretive environmental impact assessment report by NMP.

NMP, which wants to mine marine phosphate to make fertilisers for sale abroad, is 85% owned by Omani oil billionaire Mohammed Al Barwani through his company Mawarid Mining LLC, while 15% is owned by serial middleman Knowledge Katti through his company Havana Investments.

Esau’s report said the fisheries ministry is concerned by the decision of the environment ministry to issue an environmental clearance certificate.

In fact, the fisheries ministry described that decision as “premature, and perhaps in contradiction of the precautionary principle as espoused by the Latin phrase in dubio, pro natura (when in doubt, favour nature)”.

Esau wanted Cabinet to know that his ministry was not consulted before the clearance certificate was issued to NMP.

The fisheries ministry is “concerned that marine phosphate mining may commence immediately, which may cause irreparable damage to the marine ecosystem, including fisheries stocks, and hence cause a conflict between the mining and fishing industries”.

In the report, Esau said Cabinet issued a ban on offshore phosphate mining, a decision that was backed up by a legal opinion obtained on 13 December 2013 and 2 July 2015 from the attorney general as binding on the ministry of fisheries, mines and other state organs.

“This moratorium, therefore, still stands until Cabinet pronounces itself otherwise,” the minister stated.

The conditions of that ban were that no phosphate environmental clearance would be issued in 18 months, and that an independent scoping study (a preliminary study to define the scope of a project) should be done.

After that, a comprehensive strategic environmental assessment – a process of predicting and evaluating the impact of a strategic action on the environment, and using that information in decision-making – would be conducted during the ban under supervision of the fisheries ministry, in consultation with the environment and energy ministries.

Esau said during that moratorium, a scoping study was done by an independent consultant from Norway, who recommended that a strategic assessment should be conducted in order to get sufficient scientific knowledge and regulatory mechanisms in place to mitigate the impact of seabed mining on the ocean.

That strategic assessment, which is the responsibility of the fisheries ministry as the “competent authority on the marine environment”, is still not yet completed, Esau said, adding that the findings of that report will inform the environment impact assessment process.

“It was expected that the ministry of fisheries will commence on the strategic assessment once Cabinet has pronounced itself on the scoping report,” Esau said.

The fisheries ministry presented the scoping study report to the deliberative Cabinet meeting, but the matter was referred to the Cabinet committee on trade and economic development chaired by Alweendo for further discussion.

“This process is still ongoing (the last meeting was on 27 April 2016, the last communication on 7 July 2016 raised questions that are still pending),” Esau said in the report.

This appears to be the point where Esau was sidelined by his fellow ministers on that committee. Instead of discussing the scoping report, the majority of ministers on the committee directed the environmental commissioner to decide on the phosphate application.

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The fisheries ministry wants Cabinet to re-endorse the decision and conditions made in 2013, and to ban phosphate mining and direct the environment ministry “to immediately withdraw the environmental impact assessment clearance certificate issued for marine phosphate mining on emergency grounds”.

Esau said once Cabinet clarifies the earlier decision, the next step in the marine phosphate mining consideration is to conduct a strategic environmental assessment, a process which will take three to five years.

Once the recommendations of the strategic assessment are completed, the fisheries ministry will submit the findings for a final environmental impact assessment on marine phosphate mining.

Esau said since 1990, the issue of phosphate mining has been one of the most important policy decisions for the country, apart from the issue of the dumping of nuclear waste, the poaching of wildlife and the international trade in endangered species.

“Therefore, it would have rendered a united government if adequate consultation had occurred before the environmental clearance certificate was issued,” he noted.

Esau also wants Cabinet to consider authorising the development of Namibia’s blue ocean economy policy, to act as government’s policy coordinator on cross-cutting issues.

This policy will be developed by the fisheries, mines and energy, environment, works and other line ministries.

The attorney general’s office will provide legal guidance on the process which involves these ministries.

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