Licensing bottleneck in Pretoria

David McKay | Thu, 07 Jul 2005 07:20

[miningmx.com] -- SOUTH Africa’s new mineral rights ownership legislation must be implemented quicker or risk its credibility, says Hulme Scholes, a partner at Werksmans Attorneys. “The Department of Minerals & Energy (DME) has to start getting the new order prospecting rights out. People need to know that the system is working.”

Mining companies hoping to retain unexplored mineral title had 12 months until 31 April 2005 to nominate a black empowerment partner with the finance to buy the stake in the property. After the deadline, any other party can apply for ownership of the property provided they meet empowerment criteria.

Applications for many of the SA’s important, unexplored mineral-bearing properties had been made within the deadline by established mining firms, said Scholes. However, the DME are not processing successful applications quickly enough. Says Scholes: “I think the regional offices are quite organised, having dealt with them at Kimberley, Gauteng and Witbank. The problem is probably in Pretoria. Politicians are still making the decisions when it should be public servants interpreting the law.”

There’s a good open door policy in the DME, says Scholes. “But everyone is becoming frustrated because it seems only the lawyers and the bankers are getting something out of empowerment.”

One of the criticisms levelled at Government ahead of empowerment and minerals ownership legislation was that it wouldn’t have the capacity to tackle administration. The irony is that regional capacity appears to be in good working order and the systems are in place. However, central Government needs to let go of its legislation and let it operate.

Scholes says: “You get the sense Government wants to establish a warm, fuzzy feeling regarding empowerment. But you can’t put that in a box. Foreign companies in particular want to know exactly what’s required and, once achieved, ask: ‘When do we get our licence’?”