‘Inept Government ruining mines’
SOUTH AFRICA’S BESIEGED local resources sector won’t have to deal with the implications of the proposed mining royalties regime this year. The new minerals dispensation established in 2005 is threatening to inflict enormous damage on the mining industry due to the administrative inability of the Minerals & Energy Department to handle the conversion, miners say.
Around 18 000 applications for prospecting, exploration and mining rights have been received by the department for final conversion to the new minerals dispensation, which should be in place by end-April this year. However, there’s great concern in the mining industry about the department’s administrative inability to process the thousands of applications for conversion of mineral rights.
The deadline for applications is end-April. Last Tuesday – at the Mining Indaba in Cape Town – Buyelwa Sonjica, Minister of Minerals & Energy, warned no extensions would be granted. Failing to apply would certainly have consequences, she said. She undertook to ensure all applications for prospecting and exploration rights would be processed within six months. Applications for mining licences would be processed within a year, she promised.
Some of the larger players in the mining industry who were hesitant to be identified said on Tuesday those promises were wishful thinking, as Sonjica’s department simply didn’t have the administrative capacity. “We have applications for mining rights that were submitted in 2005 and have still not been finalised. This legislation has made Government the owner and patron of the country’s mineral rights, but Government will do the country an enormous disservice if it doesn’t quickly ensure it has the administrative capacity to perform this task,” one miner commented.
The applications are complex because they have to provide for labour and social plans. Though the plans must include social development objectives those often lead to endless correspondence between applicants and the department due to the vagueness of the legislative prescriptions in that regard.
Manus Booysen, a senior partner at legal firm Webber Wentzel and a specialist in mineral rights, says there are several applicants’ files in his office that won’t be ready for submission to the department by end-April. “However, we’ll have to hand them in – which means they would be rushed. That will make it even more difficult [for officials in the department] to finalise the applications,” says Booysen.
No extensions. Buyelwa Sonjica