NZ firm’s bold move to strike southern gold

Tran Ha Tien, the company’s chief representative in Hanoi, last week told Vietnam Investment Review that the company had received strong support from the local government, which agreed to zone the areas under Zedec’s exploration plan.
“We [Zedex] have been investing significant amounts of time and money in overall mineral prospecting projects in Vietnam. If the prospects prove positive, we shall move ahead with mining projects, which will surely produce benefits for the local economy in particular as well as the whole nation,” Tien said.
He said Zedex began eyeing the Kim Son and Tien Thuan regions in 2003 and hoped that all necessary papers would be drawn up in time, enabling the company to conduct test digs in the areas very soon.
An official from the Binh Dinh Planning and Investment Department revealed that Zedex planned to invest more than $700,000 in tests over two years when it receives an exploration licence.
“We welcome Zedex to conduct tests on the Kim Son and Tien Thuan gold reserve areas, where no accurate estimates have been conducted so far,” he said.
Zedex was the first New Zealand company to receive approval to open a representative office in Vietnam in February, 1994. The company has stakes in the $15 million Bong Mieu and $10 million Phuoc Son gold ventures, which are under construction in central Vietnam.
Zedex also wants to secure an exploration licence on the 40-square-kilometre Na Pai gold area in northern Lang Son province. Although the central government gave the green light to the project in 2002, Zedex has not yet received a licence from the Ministry of Natural Resources and Environment. Zedex is also interested in the Ban Phuong gold area in the mountainous northern province of Son La.
Last month, an Australian-led mining consortium was awarded a two-year licence to explore a 154-square-kilometre gold ore reserve in the Pu Sam Cap region in the northern mountainous province of Lai Chau after waiting for more than 10 years.
The consortium, Triple Plate Junction Ltd (TPJ), comprises two Australian companies – Newmont Vietnam Ltd and Vietnam Resources Corporation – and local partners Vietnam Minerals Corporation, the Mountainous Trading and Construction Company and Dien Bien Minerals Company. TPJ plans to invest around $2 million in prospecting the approved area.
Foreign investors complain that Vietnam’s poor legislative framework for mineral exploration, extraction and processing deters major foreign-invested mining projects, despite the mineral law coming into effect in 1996.
Many claim that investors normally have to wait years to obtain an exploration licence, and that mining was a high-risk industry requiring significant capital expenditure, but the current legislative regime in Vietnam does not offer much incentives to invest in the sector.