The world’s sole commercial petalite miner, Bikita Minerals, has urged government to offer incentives to companies who do exploration.
BY NDAMU SANDU
Bikita Minerals chief executive officer Grant Hudson told NewsDay Business during a tour of the mine on Tuesday that other countries offer incentives for miners that do exploration works.
“It’s a lot of money, every company does that exploration. If you look at Canada, they incentivise exploration. If you are doing exploration in Canada, you get a tax rebate. The government wants you to explore. They are saying it’s good for us if people discover new mineral ore bodies and, therefore, we give people a tax incentive for exploration. I think that is a sort of thing that government can look at,” he said.
Canada has the Mineral Exploration Tax Credit (METC) designed to help exploration companies raise equity funds. It can be used in addition to the regular tax deduction associated with flow-through share investments, according to Natural Resources Canada. Flow-through share investment allows a principal business corporation to obtain financing for expenditures on mineral exploration and development in Canada. METC is a 15% non-refundable tax credit on expenses. This incentive was supposed to expire at the end of the month, but has been further extended by a year.
Bikita Minerals has been undertaking exploration through drilling holes and in the period 2015 to 2016 drilled 15km of holes. Last year, 17km was drilled and this year 2,3km. Each hole which can be 90 metres deep cost $125 per metre.
“You need to know what is underground before you start expensive digging,” Hudson said.
Zimbabwe is underexplored with Mines and Mining Development minister Winston Chitando, saying his vision included the ramping up of exploration by having more exclusive prospecting orders (EPOs).
“At some stage, we had over 300 EPOs, but at the moment, we have three EPOs. Zimbabwe is under-explored. Most of the exploration data we have here was generated in the 50s and 60s and Zimbabwe has not been subjected to exploration using modern techniques,” he said.
Bikita exports over 40 000 tonnes of petalite per annum and is working on ramping up output to 80 000 tonnes per annum.