Gemfields has temporarily suspended its ruby mining activities in Mozambique due to escalating violence that led to two fatalities.
On Christmas Eve, over 200 individuals connected to illegal ruby mining attempted to storm the residential village near Gemfields’ Montepuez Ruby Mining (MRM) site in northern Mozambique. The group reportedly set fire to MRM-built community structures and tried to access the facility amidst widespread civil unrest following the country’s contentious national elections.
In response, Mozambican police and military forces employed a “staged escalation of force,” which resulted in two deaths, according to the company.
On the same day, a vocational training centre in the nearby Wikupuri village, built and managed by MRM in partnership with Mozambique’s Institute for Vocational Training and Labor Studies, was looted and damaged.
For safety reasons, Gemfields relocated more than 500 employees to off-site locations. The company confirmed that a phased return of staff began on Thursday.
The unrest stems from Mozambique’s top court confirming the election victory of the long-ruling Frelimo party, a result contested by opposition groups who allege electoral fraud. Civil society group Plataforma Decide reports that at least 130 people have died in clashes with police since the elections. While Frelimo denies the allegations of vote-rigging, the electoral commission has yet to comment on the fraud claims.
The violence has also affected other foreign mining operations in the country, including those of South32.
The Montepuez ruby mine, one of the world’s richest ruby deposits, is 75% owned by Gemfields and employs about 1,400 people, according to the company’s website.
Gemfields shares saw a 5.6% increase by 2:00 p.m. GMT, with the company’s market capitalization standing at £84 million ($106 million).
