Mozambique’s largest ruby mine to resume production

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Mozambique’s largest ruby mine to resume production

9:24 CAT | 30 Dec 2024

File photo: Gemfields

Montepuez Ruby Mining (MRM), operator of Mozambique’s largest ruby mine, announced plans to resume production by the end of the year, after operations were halted on December 24 due to post-election conflicts.

The suspension followed a deterioration in security conditions in the mine area, located in Cabo Delgado, northern Mozambique. On December 24, the company detailed in a statement accessed by Lusa, “more than 200 people attempted to invade” the MRM village, destroying and burning several structures.

During this escalation of violence, police and military forces ensuring security at the site intervened, resulting in the deaths of two individuals.

Some of the 500 people working in the area were relocated to other locations starting December 26 for security reasons, two days after operations at the mine were halted.

“MRM aims to return to normal operations before the end of the year,” the company assured in the same statement, noting that the neighboring village of Wikupuri, built by the mining company, was also attacked this week by alleged protesters, leading to looting and destruction.

Mozambique has been experiencing a new wave of social tension since last Monday, following the announcement of the final results of the general elections. This period has been marked by looting, vandalism, and barricades, particularly in Maputo.

Last Monday afternoon, the Constitutional Council declared Daniel Chapo, the candidate supported by the ruling Mozambique Liberation Front (Frelimo), as the winner of the presidential election with 65.17% of the votes, succeeding Filipe Nyusi. Frelimo also retained its parliamentary majority in the general elections held on October 9.

This announcement triggered further chaos across the country, with pro-Venâncio Mondlane protesters—who received only 24% of the votes—taking to the streets with barricades, looting, and clashes with the police, who have been firing shots in an attempt to disperse demonstrators.

Ruby mining at the MRM site has generated over €1 billion since 2012, according to data released in late April by Gemfields, which owns 75% of the company. According to the report “G-Factor for Natural Resources,” which promotes transparency on the wealth shared by Gemfields with host country governments from mining, oil, gas, timber, and fisheries sectors, MRM generated total revenue of $151.3 million (€145.1 million) in 2023.

Since Gemfields acquired its 75% stake in MRM in February 2012—the year mining began, with ruby auctions commencing two years later—the mine has accumulated revenues exceeding $1.055 billion (€1.012 billion). During the same period, it has paid $257.4 million (€246.9 million) to the Mozambican state.

Last year, MRM paid $53.2 million (€51 million) in royalties and taxes to the Mozambican state, according to the same report.

MRM is 75% owned by Gemfields and 25% by Mwiriti Limitada, a Mozambican company.

Source: Lusa