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IOL News
3 days ago
- Business
- IOL News
Criticism of South Africa's new Mineral Resources Bill: A disaster in the making?
Sharp criticisms have emerged over the structure of the new Mineral Resources Bill that was gazetted for public comment last week by Minister of Mineral and Petroleum Resources Gwede Mantashe Image: Reuters Sharp criticisms have emerged over the structure of the new Mineral Resources Bill that was gazetted for public comment last week by Minister of Mineral and Petroleum Resources Gwede Mantashe with the DA on Wednesday saying, "The new minerals bill is a disaster in the making." This comes hot on the heels of the Minerals Council on Tuesday saying its contributions were not incorporated. Mantashe and other government officials hope that the Mineral Resources Development Bill and the Critical Minerals and Metals Strategy blueprint will help to shore up mineral exploration, spearhead SA's production of critical minerals and attract international investment into the mining sector. 'The bill is poorly thought out. It is contradictory and unclear in several places. It grants new powers to the Minister to rule the industry according to his own whim,' said James Lorimer, the DA's spokesperson on mining issues. He further said the bill will 'end the already tottering case for foreign investment' in the mining sector. Among the stipulations that the DA is opposed to is a provision requiring ministerial approval for the change of control of any listed company holding a mining licence. Lorimer also voiced out concerns over a 'vague requirement that certain minerals would have to be made available for local beneficiation' adding that there was no clarity over 'who would do the beneficiation or at what price' mines would have to make the minerals available. Mzila Mthenjane, the CEO of the Minerals Council, said the published bill 'does not reflect inputs' from the grouping of SA's mining sector players. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Ad loading 'The draft bill is not altogether optimal,' said Mthenjane, adding that an industry preference seeking that the legislation 'specifically exclude prospecting companies from empowerment' had not been included. 'Exploration is the highest risk part of the mineral value chain and imposes an unnecessary burden on prospectors who must sink every rand into drilling and data interpretation. Yet in this draft bill, none of that is included,' he explained. Lili Nupen, a mining policy expert who founded Johannesburg-based NSDV, told Business Report though that the bill's effectiveness will be hinged on how it is implemented. 'NSDV Law is of the view that the South African mining industry stands to benefit from the implementation of the Mineral Resources Development Bill and the Critical Minerals Strategy, if they are executed effectively and supported by consistent policy implementation,' said Nupen. She added that the Mineral Resources Bill was supposed to be representative of the South African government's recognition of investor concerns and, therefore, should be a mechanism of reforming the legal framework that governs the mining sector to address concerns. 'For example, the alignment of the mining and environmental regulatory timeframes and processes, as well as their acceleration, is directly aimed at addressing current concerns regarding the backlog of the processing and authorisation of mining projects. Similarly, the Critical Minerals Strategy provides much-needed clarity on South Africa's mineral priorities, which could guide investment decisions and support coordinated development efforts.' South Africa, a major mining hub in the region, has identified platinum, manganese, iron ore, coal, and chrome ore as 'high-critical minerals' under the new Critical Minerals and Metals Strategy.
Daily Maverick
3 days ago
- Business
- Daily Maverick
Industry sees red after Mantashe says no BEE for mining exploration, contradicting draft Bill
A new mist of uncertainty has shrouded mining policy just as progress is being made on other fronts such as the looming rollout of the long-awaited mining cadastre to address the applications backlog for mining and prospecting rights and permits. The draft Mineral Resources Development Bill (MRDP) has stirred a hornet's nest in the mining industry and with the ANC's GNU political partner the DA, and its ill-conceived nature was on full display on Wednesday when Minister Gwede Mantashe confusingly said the BEE requirements for exploration were not there and would be removed if they were. 'Now, and in the future, there's no provision for BEE on exploration,' Mantashe, the Minister of Mineral and Petroleum Resources (MPR), said during a media briefing at the conclusion of the AGM for the Minerals Council SA, the main body representing the country's mining industry. That's neither the Minerals Council's reading of the draft Bill nor Daily Maverick's interpretation of it. 'We raised this point over and over in our engagements with the department that the amendments must specifically exclude prospecting companies from empowerment requirements … Yet in this draft Bill, none of that is included,' Minerals Council CEO Mzila Mthenjane said in a statement on Tuesday. The thing about prospecting – or exploration – is that it is an extremely high-risk activity that onerous BEE rules will severely curtail. And without exploration, the South African mining industry has no viable long-term future. Daily Maverick asked Mantashe to clarify this afterwards and he responded by saying: 'If there is a BEE requirement in the Bill for prospecting, it must be removed.' So, the industry's complaints on this front are not falling on deaf ears, though it has raised concerns that its inputs were not included in the draft. And a new mist of uncertainty has shrouded policy just as progress is being made on other fronts such as the looming rollout of the long-awaited mining cadastre to address the applications backlog of mining and prospecting rights and permits. Overall, the industry is not happy with the Bill, which once again moves the goal posts at a time when investors are crying for certainty for a sector that remains crucial for South Africa's low-growth and high-unemployment economy. 'When we ask ourselves this question, does this Bill promote investment and create jobs, we see it has some serious short-comings,' said Paul Dunne, the CEO of Northam Platinum, who was re-elected as president of the Minerals Council SA. 'They are both substantive in nature and technical … Council is a very considered, professional advocacy group. We represent at least 99% of the mining industry in this country and our submission [on the draft Bill] will be made public when the right time comes, and we will engage very, very robustly with the department and the minister on this issue,' he said. The good-natured Dunne added: 'The minister knows us very well. We are very tough. And minister, we are coming.' That raised a chuckle from the audience and Mantashe, but it is no laughing matter – except for lawyers, who are going to giggle all the way to the bank. The draft Bill raises the almost certain prospect of arduous and time-consuming legal and court battles – another obstacle to the investment that the mining sector and wider South African economy desperately need to reach faster levels of growth and job creation. It has also raised hackles in the GNU, which is supposed to be the ANC's main governing partner. One bone of contention is embedding the Mining Charter into the legal framework, which could once again unleash the 'once empowered, always empowered' debate which the industry has already won in court. But fresh legal scraps could loom on this front. This played out in the courts when Gupta stooge Mosebenzi Zwane was the minister in charge of mining, and the term refers to the industry's contention that once a company reached a required BEE ownership threshold that should be set in stone even if black shareholders decided to sell their stakes – which is the point of owning shares. The government at the time held that mining companies needed to endlessly keep topping up BEE stakes, a state of affairs that would dilute value and repel foreign as well as domestic investment. 'By expressly including the Mining Charter as law and not simply policy, the Bill allows for the rapid overturning of t'once empowered, always empowered', opening the door to the need for constant injections of new BEE investors, a feature which would on its own make investing a lossmaking prospect,' MP James Lorimer, the DA spokesperson on Minerals and Petroleum Resources, said in a statement. 'The Bill is poorly thought out. It is contradictory and unclear in several places. It grants new powers to the Minister to rule the industry according to his own whim.' What this means More policy confusion and uncertainty at a time when South Africa needs both to extract wealth, investment and job creation from its rich minerals endowment. It will also test the GNU and likely trigger a tsunami of legal challenges for South Africa's already stretched court system. The ANC is acting like it has a two-thirds majority in Parliament on this front and has yet to be pulled back to Earth by the laws of political gravity. Mantashe on Wednesday reminded the industry of its racist past, and that is no bad thing – in an age when US President Donald Trump is parroting fascist-inspired lies about 'white genocide', hard historical truths need to be confronted head-on. The South African mining industry was the economic bedrock of apartheid, subjecting an overwhelmingly black migrant labour force to ruthless exploitation. But the times are changing and the industry – partly in response to government regulation and union demands but also wider concerns among investors foreign and domestic – has made strides from the indignities of the apartheid past on a range of fronts, including ownership, wages, communities, health and safety. BEE as a mantra has not delivered a utopia while enriching a relatively small elite, and it is also starting to look like a fossilised relic in an age when – despite the Trump administration's efforts to turn the tide – capital is largely looking for kinder, gentler returns. The Bill, for now, is not law and open to public comment. Break out the popcorn for the fireworks. DM
IOL News
4 days ago
- Business
- IOL News
South Africa in talks with Zambia and Zimbabwe to run Grand Inga transmission line
The Inga hydroelectric dam. Image: Reuters Minister for Minerals and Petroleum Resources Gwede Mantashe said South Africa is initiating discussions with Zambia and Zimbabwe on the possibility of running the electricity transmission line from the Democratic Republic of Congo (DRC) under the Grand Inga project, through which 2 500 megawatts are envisaged for the country. Mantashe was responding to questions from members of the Portfolio Committee on Minerals and Petroleum Resources on Tuesday, who had asked about the status of the project and what the country was doing to harness regional collaboration following the decision to postpone participation in the project. "The Grand Inga project is not ours; it's a DRC project, given to the Spanish and Chinese. We have a right to buy equity in it, which would have to be approved by the DRC. We have not bought that equity, so we can't really pretend to be managing the Inga project. It is not our project. We have committed ourselves to a quantity of electricity that will be taken up by South Africa, but the driving of the project is out of our jurisdiction," Mantashe said. MKP MP Crown Prince Adil Nchabaleng objected to the Minister's stance, indicating that South Africa still considered the project feasible. "You can't expect to tell us that you are going to power South Africa from the Grand Inga project. Is South Africa talking about a concession to resell in that market with regard to the 2 500 MW as an investment partnership? You cannot power South Africa from the Grand Inga project," he said. Mantashe maintained that there were ongoing discussions. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ "In the plan for Grand Inga, there is a plan for a transmission line to go through two countries to South Africa, so it is possible. Electricity is not loaded in a truck; it is transmitted through a line that can cross borders. In our discussions, we have explored the possibility of involving Zimbabwe and Zambia, as the transmission line will cross their territory. So, it is possible to get electricity from Grand Inga," Mantashe maintained. The Grand Inga Hydropower Project, a massive dam construction on the Congo River in the DRC, is intended to generate a large amount of electricity, with South Africa being a key off-taker. This project is envisioned as a major source of clean energy for the region and potentially for the entire African continent. South Africa has expressed interest in importing electricity from the Grand Inga project, particularly from Inga 3, the first of the new hydropower facilities. South Africa's energy planning assumes the country will import 2500 MW from Inga by 2030, with the potential to double this to 5 000 MW. A long transmission line, passing through Angola, Namibia, and Botswana, would be needed to deliver power from Inga to Gauteng, South Africa's economic heartland. South Africa and the DRC have signed agreements on receiving electricity from Inga, and the project is in the process of finalizing an agreement and securing financing. Meanwhile, Mantashe clarified that the launch of the South African National Petroleum Corporation (SANPC), which resulted from the restructuring of the department into two entities, may seem like a negative intervention to many, but gave the department space and opportunity to prioritise petroleum appropriately. He noted that petroleum is a source of 80% of the world's energy but currently plays second fiddle to renewables. BUSINESS REPORT
The South African
6 days ago
- Business
- The South African
SANPC: South Africa's newest state-owned enterprise open for business
Minister of Mineral and Petroleum Resources Gwede Mantashe has officially launched the South African National Petroleum Company (SANPC), declaring it 'open for business' and ready to welcome both local and international investors. Speaking at the launch ceremony in Johannesburg last Friday, Mantashe said the formation of the SANPC marks a pivotal step toward enhancing the country's energy security, reducing reliance on fuel imports, and managing South Africa's petroleum assets more effectively. The new state-owned enterprise (SOE) is the result of a merger between three key entities: PetroSA, iGas, and the Strategic Fuel Fund Association. 'The real issue is ensuring energy security in the country,' said Mantashe. 'In the wake of evolving global trends, including the shift away from fossil fuel usage, the SANPC will operate in an increasingly volatile, unpredictable, and polarised world.' Mantashe emphasised that despite global energy transitions, the demand for fossil fuels will continue to rise, particularly in developing economies like South Africa. 'Reviving PetroSA is important, SAPREF is important, and if there are people who want to partner with us… we are open for business,' he declared. 'We are open for partnerships, and we are open for people who want to invest.' The SANPC is expected to take a central role in strategic planning, coordination, and governance of the petroleum sector. Its overarching mandate includes: Supporting sustainable development Driving inclusive economic growth Investing in local refining capacity Reducing the country's import dependency for petroleum products To ensure the company can become self-sustaining, Mantashe urged it to leverage strategic partnerships and national energy capabilities. The Minister said that good governance would be the backbone of the new entity's success. 'To enable the entity to deliver on its mandate, we had to ensure good governance… hence, we swiftly appointed the board of directors, an interim CEO, and non-executive directors in April last year,' he noted. Since then, Mantashe said progress has been made in establishing governance structures and resolving legacy issues. 'For SANPC to succeed, it must have strong leadership with vision and the ability to develop managerial capacity. Employees must embrace a new culture of collaboration, transparency, and teamwork,' he added. The launch of the SANPC signals a renewed focus on domestic energy capacity, as South Africa grapples with the global energy transition and the need for long-term economic stability. Mantashe concluded with a call for financial prudence and innovation. 'A task at hand for all of us is to ensure that the entity remains financially sustainable and independent in order to fulfil its developmental mandate.' Let us know by leaving a comment below, or send a WhatsApp to 060 011 021 1 Subscribe to The South African website's newsletters and follow us on WhatsApp, Facebook, X and Bluesky for the latest news.
The Star
22-05-2025
- Business
- The Star
South Africa's mining sector hails new critical minerals strategy as key to investment, growth
JOHANNESBURG, May 22 (Xinhua) -- South Africa's mining industry has welcomed the government's newly launched Critical Minerals Strategy and the Cabinet's approval of the Mineral Resources Development Bill (MRDB), calling them major steps toward boosting investment, enhancing local value addition, and strengthening regional industrialization. South African Minister of Mineral and Petroleum Resources Gwede Mantashe announced the approval of the two policy documents on Tuesday, noting that they are critical for ensuring policy certainty and unlocking South Africa's potential in the global minerals market. "The approval of these two policy documents marks a major milestone in our concerted efforts that are aimed at ensuring policy and regulatory certainty, as well as maximizing the country's potential in the global market for minerals," Mantashe said. He noted that while the term "critical minerals" is widely used internationally, definitions vary based on each country's strategic priorities -- including economic growth, technological development, supply chain security, and geopolitical interests. For South Africa, the strategy prioritizes minerals such as platinum, manganese, iron ore, coal, and chrome ore, which are identified for their potential to drive economic and industrial development. At the heart of the new strategy is a push to "foster" regional cooperation, promote local beneficiation, build resilient value chains, and attract investment in exploration and research. Mantashe emphasized that the aim is not just national growth but broader regional industrialization through a more strategic and localized approach to mineral resources. The strategy has been positively received by the mining industry. The Minerals Council South Africa, the sector's main representative body, confirmed that it was consulted during the drafting process and welcomed the government's inclusive approach. Independent analyst and businessman Sandile Swana described the policy shift as a "game changer" for the mining sector. "These new strategies and policies that have been issued by Gwede Mantashe and the Cabinet do change the game," he told Xinhua in a phone interview on Thursday. Swana highlighted the significance of this shift for both economic and geopolitical security, particularly in an era of increasing global trade tensions. "We've seen with the international trade wars that are in progress at the moment that during times of sensitivity, critical minerals are weaponized," he said. "That means that even in considering your security, you need to know what strategic minerals come out of your country, even your region." "I think South Africa wants to lead the Southern African Development Community (SADC) region into knowing how to manage the strategic minerals. It means that when these strategic minerals are sold, they are more likely in the future to be sold in a value-added form," he added. The new MRDB, expected to be published for public comment soon, is seen as an essential complement to the Critical Minerals Strategy, aimed at streamlining regulatory frameworks and encouraging sustainable development in the sector.
