Salgaocar, a mining company in Swaziland
half-owned by King Mswati III, has suspended operations, owing creditors
approximately E42 million (US$4.2 million).
An application has been filed in the Swazi High Court to
place the company under provisional judicial management. It is
reported that 700 jobs could be lost.
Salgaocar Swaziland began operations in October 2011 in
controversial circumstances.
Salgaocar, an Indian-based global conglomerate, was granted a licence to mine
iron ore at Ngwenya in Swaziland, within a protected area inside the Malolotja
Game Reserve, despite fears that its work would pollute the water supply of
many rural people and also the population of Mbabane, the kingdom’s capital.
But, the
licence was granted and a company called Salgaocar Swaziland was formed with 50
percent of it owned by Swaziland, according to MetalBulletin, an industry
journal.
In Swaziland, King Mswati III is an absolute monarch and he keeps all
mineral royalties in trust for the nation. In practice, he chooses how the
money is used and it is mainly spent to finance his lavish lifestyle that
includes 13 palaces, fleets of BMW and Mercedes cars and high-class international
travel for himself, his 14 wives and other members of the Royal Family.
Salgaocar
Mozambique Chief Executive Officer Ron Herman said in 2010
that he
expected 200 million tonnes of ore to be extracted. Salgaocar Swaziland Chief
Executive Officer Sivarama Prasad Petla said Swaziland would get a royalty of
50 US cent per tonne.
On this basis the King stood to get US$100 million.
On this basis the King stood to get US$100 million.
Now, it seems the prospects for the company might have been over-stated.
In documents
filed at the Swazi High Court the company’s Director Sihle Dlamini said in
December 2013, the price
of iron ore started to fall ‘and this impacted negatively’ on Salgaocar’s ability to continue its
operations.’
He said its current liabilities amounted to approximately E42 million.
He added more than 700 people could lose their jobs but this did not include
the employees of ancillary service providers.
Liquidator
and accountant Paul Lubenga Mulindwa has been appointed Judicial Manager of
Salgaocar.
See also
PRIVATE FIRM
GAVE KING HIS JET
http://swazimedia.blogspot.com/2012/04/private-firm-gave-king-his-jet.html
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