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Zwane must reconsider key aspects of mining bill - expert

Feb 08 2016 16:03
Matthew le Cordeur

Cape Town – Mineral Resources Minister Mosebenzi Zwane sent a positive message to mining companies, with an emphasis on policy certainty that fits in with the African mining vision, according to a mining expert.

Manus Booysen, Webber Wentzel partner and head of mining practice, told Fin24 on Monday that Zwane’s speech at the Mining Indaba in Cape Town revealed government’s desire to work with business to solve the crisis in the mining industry.

Zwane said that in his discussions with various mining bosses, their major concern was the reworked amendment bill of the Mineral and Petroleum Resources Development Act (MPRDA).

Booysen said that, to ensure that South Africa remains a part of the global community, certain problematic aspects of the bill will have to be re-considered.

The first issue concerns South Africa’s international obligations. “The Bill will empower the government to force mining companies to sell a portion of their production for local beneficiation,” he said.

“This will contravene South Africa’s obligations in terms of International Trade law. The South African government will have control over a portion of the market and the price.”

The other regarded the application system for rights under the MPRDA. “We currently have a first come first serve principal,” he said. “The applications are dealt with in order of receipt.”

“The proposal in the bill is to create a system of invitation of applications.  If a potential applicant identifies an area for application, it must request then minister to invite applications for that mineral and area. The minister will then invite applications and will decide which application is best based on a number of criteria. This could open the system up for abuse.”

“We must remain a part of the international mining community as the minister said in his speech,” he said. “We can only achieve this if we subscribe to and comply with international best practice principles. I am positive that this is what the minister foreshadowed in his positive opening address in difficult times.”

Booysen said Zwane’s message was very positive message. “The whole speech was premised on responses from the industry, as a result of the engagement with the captains of industry and the issues identified during the engagement process.”

“I hope his open door policy he mentioned will lead to a more formal engagement process between government, labour and business.”

“We need a lekgotla to put all our cards and issues on the table,” said Booysen.

mining indaba  |  mining
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