Mine in limbo as activists and miner square off

A long battle over a proposed coal mine in an ecologically important area has culminated in an interdict halting the mine’s development until all pending reviews and appeals have been finalised.

Environmental justice groups have welcomed the ruling, but the mine developers, who have already sunk $56m into the project, warn it could have farreaching consequences for mining and other investments in SA.

The judgment, recently handed down by the high court in Pretoria, found in favour of the applicants — a coalition of civil society organisations opposed to the Yzermyn underground coal mine near Wakkerstroom, Mpumalanga — and halted its development until final determinations have been made on nine reviews and appeals regarding the mine’s permits.

The ruling has piqued the interest of the Minerals Council SA, although the mining industry body would only say it is studying the judgment and consulting with members to understand its implications.

Praveer Tripathi, senior vicepresident of Uthaka Energy, a subsidiary of the Atha Group in India and the developer of Yzermyn, says the implications are not just adverse for foreign investors such as Uthaka Energy, but for all business in SA.

Uthaka Energy, then called Atha-Africa, acquired the prospecting rights for the mine in 2011. Two years later, it applied for the mining right.

In January 2014 the area was declared the Mabola Protected Environment under the Protected Areas Act. Yet Tripathi says all permits and authorisations were obtained by 2016. But soon thereafter challenges to the mine’s various authorisations and permissions began to roll in from NGOs, which formed a coalition as efforts intensified.

The area has since also been recognised as part of one of SA’s 22 strategic water source areas for which the government is creating legal protection.

To mine in a protected environment requires permission from the ministers overseeing the environment and mining.

Uthaka obtained this in 2016, but in late 2018 the decision was set aside by the high court and the ministers were directed to reconsider the application. Leave to appeal has been refused by the Constitutional Court.

There is, however, provision for the protected status of land to be revoked, which is what Mpumalanga MEC Vusi Shongwe did on January 15 2021, after being petitioned in favour of the mine’s development by the local community and other signatories.

But the recent high court interdict, described by Tripathi as a death knell for investment in SA, has now dealt a potentially fatal blow to the mine.

“Under the rule of law, these statutory authorisations are administrative acts by several delegated authorities and they remain in existence in full legal force and effect until set aside by a court,” he said, noting that the interdict now turns this on its head, effectively suspending the authorisations for the mine.

Uthaka has already sunk an estimated $56m into the project, $43m to acquire the prospecting right in 2011 and $23m more on further studies, Tripathi said.

“Which foreign company or even SA company would want to do business in SA when you know anybody can stop anyone from doing it?” he asked.

James Cross, director of environmental health & safety at law firm Andersen in SA, says the environmental setting of the proposed mine has played an obvious and significant role in the coalition’s ability to prevent its development.

“However, there are other factors of concern to prospective coal mining operations that are of a more universal nature and that pose a dangerous precedent for the future,” he said.

The Yzermyn matter, Cross said, bore testament to the enhanced ability of opponents to coal mining ventures to successfully exploit regulatory shortcomings against the backdrop of sensitive and controversial environmental settings.

Bobby Peek, director and founding member of nonprofit groundWork, one of the groups opposing Yzermyn’s development, says he agrees that the judgment sets a dangerous precedent for business in SA.

That is, “you can’t buy your way into our economy”, he said, noting that the sizeable sum sunk into the project has not benefited local government or the community and equates to a “bad business deal” for Uthaka.

“It’s not just about [the] environment,” Peek said. “If we want to secure economic development for the long term, we need good water … if you stuff up this water source now, it’s going to have long-term implications downstream.”

With the relentless opposition to Yzermyn, it is hard to see why Uthaka would persist.

“If [Atha] were not a familyowned business, we would have gone back [a] long time ago. But it is a matter of pride for us — we have already invested so much money here. And that money can only be recovered if there is a mine in place,” Tripathi said. “So we are stuck with it, but we will brave it out. At some point … sense will prevail.”

Tripathi said support for the project from a local organisation, the Voice Community Representative Council — known as the Voice — also gives Uthaka hope that the mine may still be developed.

“This alarmist agenda is not sustainable, and we are seeing it on the ground,” he said.

The Voice joined a number of court cases to advocate for the community interests in having the mine developed.

Voice chair Thabiso Nene said the recent interdict was a disappointment to those living in poor townships and rural areas who had been looking forward to the mine’s development and job creation for many years.

Nene said it is unfair to predetermine that the mine will fail to uplift the community.

“There’s no institution that can come into any community and eradicate poverty. But it’s that drop that helps to keep changing the status quo — that’s 5,000 people getting jobs. That’s the fight against poverty. And that’s what we are hoping for,” he said.

“We are not calling for dominance over mining, neither will we accept being dominated by [the] environment. We still believe that [the] environment and mining can coexist.”