From the African Indaba

Tanzanian Uraniumleaks: Secret Contract between Hunting Company and Uranium Miners Revealed
Rolf D. Baldus

Opposition shadow minister for Lands, Halima Mdee, revealed in the Tanzanian parliament, on July 12, 2012, a secret contract between Game Frontiers hunting company and the firms Uranium Resources PLC and Western Metals Limited. The contract had been drafted by the local law firm Rex Attorneys on March 23, 2007 and covers the Mbarang’andu village hunting-block, which is actually a Wildlife Management Area. According to the local newspaper, The Guardian, the MP leaked the information that the hunting company will receive 6,000,000 USD in two tranches, if uranium is found and mined. During prospecting the company will receive 250,000 USD annually. The village, which actually owns the block, will receive 10,000 USD annually, according to the secret contract.

The Guardian states: “As a result of its presumed illegality, the confidential document is out for all to see and it names Mohsin M. Abdallah and Nargis M. Abdallah as the owners of Game Frontiers of Tanzania Limited, the leasing party. …another 55,000 USD is to be paid annually, on every first of March to compensate the opportunity cost…” Mdee went on to unravel the scandal. “I have gone through the Wildlife Conservation Act of 1974 and The Wildlife Conservation Act Number 5 of 2009. These acts allow a person with a hunting permit to only carry out hunting activities and not otherwise…”.

After a lengthy and controversial parliamentary and public debate the Minister for Natural Resources and Tourism told Parliament that the hunting license was to be revoked as a consequence of the illegal subletting of the block to other parties.

Local lawyers confirm that the owner of the block has hunting rights only and has no influence whatsoever on mining matters. In particular he cannot restrict in any way the prospecting rights of a mining company that has received a legal mining license from the responsible Ministry for Mining. The leaseholder of the hunting rights for many years paid 7,500 USD per year for hunting, although this may have been increased, meanwhile, to 25,000 USD a year. “Why should an international mining firm pay millions of dollars to a hunting company for no possible services in return?” was the question asked in parliament.

Local political analysts offer a possible answer by casting the contract as a fictitious transaction and a possible cover up. It is locally known that a high politician, who had been forced to resign from office due to a major fraud scandal, negotiated amongst others the uranium licenses in and around the Selous Game Reserve, Africa’s largest protected area (50,000 km2). The hunting operator is well connected with some in the political elite of the country and has thus recently been able to amass 15 of the lucrative hunting blocks. This makes him the No. 2 in the Tanzanian hunting business. The owner has also acquired many hotel concessions in and around national parks, even on sites that were blocked for development in the respective management plans, while he was a member of the Tanzania National Park Board. The former Minister Meghji later had to dismiss him from the board, as he had too openly abused this function for his own business interests.

Local analysts argued during the discussion of the secret deal in Dar es Salaam that the payments by the mining companies might in reality be earmarked for different services and different people. The contract might be to serve as a legal justification, for the payments in question, in the home countries of the companies, where “helpful” payments in developing countries are prosecuted as criminal acts.

In June the “World Heritage Commission”, under UNESCO, during its last meeting in St. Petersburg, had accepted in a very controversial decision that the Mkuju River uranium concession could be cut out of the Selous Game Reserve and degazetted. Uranium mining therefore can commence in the near future. Interestingly enough, this area is also inside a hunting block leased by Abdallah of Game Frontiers. Insiders alleged that an identical contract exists and that similar payments might therefore now be due. However, no contract was leaked in order to prove this claim.

According to a press article (see http://www.ippmedia.com/frontend/index.php?l=45611) published on September 9, Game Frontiers responded to a letter to the firm from Tourism and Natural Resources minister Khamis Kagasheki, asking for clarification on allegations of subletting part of its hunting block to a mining firm.

African Indaba puts on record that a copy of the signed contract is in the archives of African Indaba.

Sources: Guardian, The Citizen, Daily News, IPP Media