‘In­ept Gov­ern­ment ru­in­ing mines’

Finweek English Edition - - Companies & Markets - JAN DE LANGE

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

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