AMN - Scrapping draft bill would be sensible: Minerals Council – comment by Yolanda Torrisi

A proposal by South Africa's Mineral Resources Minister Gwede Mantashe to withdraw the much-talked-about draft Bill to amend the Mineral and Petroleum Resources Development Act (MPRDA) has plenty of merit in light of current circumstances. Indeed, the Minerals Council South Africa, the country's leading industry body, says it would be sensible to do so.

The Bill has created much consternation in the country's troubled mining industry.

In a recent briefing, the Minister said he was considering withdrawing the draft bill. It came as he updated the Portfolio Committee on Mineral Resources about the department’s state of affairs since he took the reins in February. He addressed a number of issues, including the status of the MPRDA Bill, which is with the National Council of Provinces (NCOP) for consideration.

According to Mantashe, the process has not moved for months as provinces are not in agreement on the bill.

"We had a meeting with the NCOP and there are just too many issues to sort out there," Mantashe said, according to a Bloomberg report. "They are stuck, and yet the mining sector is operating fine with the current legislation. So why change it?"

In a statement in response to the briefing, the Minerals Council said: "On balance, the minister’s approach appears to be sensible given the underlying reasons for the current delays in finalising the bill."

The Minerals Council said that even though there was intensive and useful engagement leading up to the drafting of the bill, there were a number of constitutional concerns which remained unresolved.

"Constitutional challenges, which were threatened by a range of interested parties, would have meant continuing uncertainty for the industry as these wound their way through the courts.

"In the absence of resolving those concerns, withdrawal of the bill seems to be a more appropriate option," the Minerals Council said.

The mining industry was concerned about the proposals in the Bill which left important aspects of regulations to be promulgated by the minister – especially that requiring mining companies intending to export minerals to apply for written consent from the mineral resources minister – and for being a one-stop shop for mining house operations to be regulated in one piece of legislation.

The Department of Mineral Resources’ will now present the Bill to Cabinet for ratification before it is finally withdrawn, allowing the mining industry to be governed by the MPRDA in its present form. The Bill was referred back to Parliament in January 2015 by the then president Jacob Zuma due to lack of public consultation after Parliament had passed it.

The president also raised concerns that there was a possibility that beneficiation provisions in the bill contravened international trade agreements.

The department recognised the need to remove policy uncertainty – and at the mining summit in July, Mantashe announced public consultation on the draft Mining Charter would be extended until the end of August.

According to the department, once final comments are consolidated, the charter will be gazetted in November 2018.

Yolanda Torrisi is Chairperson of The African Mining Network and comments on African mining issues and the growing global interest in the continent. Contact:yolanda@yolandatorrisi.com