Latest news with #DraftMineralResourcesDevelopmentBill
The Citizen
3 days ago
- Business
- The Citizen
Concerns over Mantashe's changes to draft mineral resources bill
Mantashe's changes to mining legislation have provoked backlash for favouring the industry over public interest. Minerals and Petroleum Resources Minister Gwede Mantashe was lashed for omitting a requirement for Black Economic Empowerment (B-BBEE) participation in applications for prospecting rights. Mantashe recently gazetted two corrections to the Draft Mineral Resources Development Bill and also nullified a provision for ministerial approval for change of control in listed companies that own mining rights. Mining expert David van Wyk asked why the minister backed down. Environmental concerns 'The prospecting companies make huge profits after prospecting reports are out. They sell the prospecting reports to the highest bidder. 'We have a serious problem with the change of control in listed companies. It is what ultimately allows mining companies to walk away from their environmental responsibilities and their responsibility to close and rehabilitate mines,' said Van Wyk. 'This is why we have more than 6 000 abandoned mines. When control of companies changes and the minister, as the custodian of the minerals which, according to the Act, belongs to the public, is not informed of these changes, he is unable to assign responsibility to the owners as he will not know who they are.' ALSO READ: 'Is it greed or jealousy?': Ramaphosa fires back at critics of BEE, Transformation Fund Call for state-led mining and revenue transparency The solution to the problems of environmental and social responsibility, as well as mine closure and rehabilitation, was to establish public ownership not just of the minerals in the ground, but also of the mining process and the extracted minerals, with the state as the custodian and the revenue accruing in a sovereign fund, Van Wyk said. South Africa does have a stateowned mining company and a sovereign fund, but the share of that company in the overall mining sector is minimal. There was no account of how much money has accrued in the sovereign fund since its inception, Van Wyk said. Christopher Rutledge, director at the Mining Affected Communities in Action, said the organisation was concerned. 'Pressure of elite interests' 'Following a mere signal of dissatisfaction from the mining sector, Mantashe swiftly amended the draft of the Bill, specifically the removal of the requirement for B-BBEE participation in prospecting rights and the omission of provisions for ministerial oversight of changes in control of listed companies holding rights. 'As we have previously warned, the main purpose of the Amendment Bill represents a further retreat from the constitutional mandate of transformation, accountability and justice for mining-affected communities. 'Rather than correcting the draft Bill, the minister has capitulated even further to the pressure of elite interests, in particular the Minerals Council South Africa, confirming the extent to which the state has aligned itself with industry over people.' Rutledge said the removal of BEE from the prospecting regime was not a technical correction, but a political decision to sell-out transformation. ALSO READ: Starlink proposal: Mashatile says Cabinet holds final say on policy changes Prospecting was the gateway to mining and excluding it from transformation requirements ensures the ownership and control of mineral resources remains concentrated in the hands of historical beneficiaries of apartheid-era privilege, he said. 'This opens the door to unchecked mergers, takeovers and asset stripping with no regard for affected communities, workers, or environmental responsibilities. We reject the illusion that deregulation is a form of reform,' Rutledge said. Industry engagements Union federation Cosatu spokesperson Mathews Parks said it was critical that legislation is in sync with B-BBEE to avoid contradictions. 'Cosatu will engage with the minister to get a better understanding of the objectives of the amendments.' Minerals Council South Africa Allan Seccombe said the organisation would continue to review the Bill and submit its perspectives by 13 August. 'The Bill in its current form does not encourage or sustain the growth and investment that the mining industry needs.' NOW READ: Cosatu says debate on B-BBEE is needed for beneciaries' benefit
Daily Maverick
11-06-2025
- Business
- Daily Maverick
Mantashe pulls back on BEE proposals for mining exploration
Exploration is an extremely risky business, and BEE ownership rules on the activity would be a major obstacle to the deployment of capital on this front. Mineral and Petroleum Resources Minister Gwede Mantashe has changed clauses in the draft Mineral Resources Development Bill (MRDP) that would have imposed BEE requirements on previously exempt exploration companies and projects in the mining space. The BEE requirements on the high-risk exploration arm of the mining sector provoked backlash from the mining industry, and Mantashe made comments last month that suggested he was not aware that the draft Bill contained such provisions — but if it did, he would correct them. 'Now, and in the future, there's no provision for BEE on exploration,' Mantashe said in late May during a media briefing at the conclusion of the AGM for the Minerals Council SA. Earlier this week, Mantashe issued an erratum notice to correct the draft and remove the BEE requirements for exploration and prospecting. 'The granting of such rights will further the objects referred to in section 2(d) and comply with the broad-based socio-economic empowerment prescribed elements,' was in the original wording regarding prospecting, but that has now been removed. South Africa's share of global exploration spend has collapsed from around 5% two decades ago to less than 1% in the face of a range of challenges, including massive applications backlogs that the Department of Mineral and Petroleum Resources hopes to address soon with a new mining cadastre. Exploration is an extremely risky business, and BEE ownership rules on the activity would be a major obstacle to the deployment of capital on this front. 'The Minerals Council South Africa notes the gazetting of … corrections to the Draft Mineral Resources Development Bill,' said the council, the main mining industry body, in a terse statement. 'The Minerals Council continues to review the Bill amending the Mineral and Petroleum Resources Development Act and we will submit our perspectives within the scheduled timeline of 13 August 2025.' Overall, the industry is not happy with the Bill, which once again moves the goalposts at a time when investors are crying for certainty in a sector that remains crucial for South Africa's low-growth and high-unemployment economy. One bone of contention is embedding the Mining Charter into the legal framework, which could again unleash the 'once empowered, always empowered' debate, which the industry has already won in court. 'Once empowered, always empowered' means that once a company meets a threshold for black ownership, it does not have to keep topping up endlessly if black shareholders sell their stakes. 'The Bill in its current form does not encourage or sustain the growth and investment that the mining industry needs to realise its full potential to create employment, stimulate the economy and fulfil its social mandate,' said the Minerals Council. DM
