Saturday , July 13 2024

Namibia seeks to reap more value from its mineral wealth

Namibia is considering taking minority stakes in mining and petroleum producers to reap more value from its mineral wealth, the African country’s mining minister told lawmakers, weighing on shares of mostly Australia-listed miners on Tuesday.

Namibia is one of the biggest uranium producers in the world. It is also a major diamond producer and has significant hard rock lithium deposits.

“We are making a case that local ownership must start with the state, which holds ownership of our natural resources,” Minister of Mines and Energy Tom Alweendo told lawmakers at a parliamentary workshop on Monday.

“The proposed state ownership should take the form where the state owns a minimum equity percentage in all mining companies and petroleum production, for which it does not have to pay.”

The Namibian Mines Ministry did not respond to requests for further details.

Shares in Australia’s Paladin Energy Ltd (PDN.AX) entered a trading halt on Tuesday after tumbling as much as 24%. The company produces uranium in Namibia.

Bannerman Energy, which is developing the Etango Uranium project, fell 7.4% to a one-month low, while Deep Yellow slumped as much as 13.4% in its biggest intraday percentage drop since May 9. Deep Yellow recently completed a definitive feasibility study at its Tumas uranium project.

It is unclear what percentage the country will seek in resource projects, but in March Alweendo told Namibia’s parliament that the government would approach the matter with “sober-mindedness”.

“We need to be mindful of the fact that there is a level above which no investor will invest – a situation we clearly do not want to find ourselves in,” he said back then.

Last year, TotalEnergies (TTEF.PA) and Shell (SHEL.L) announced offshore oil and gas discoveries in Namibia.

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