Tag: Mineral and Petroleum Resources Development Act (MPRDA)

Legal opportunities in mining are rapidly expanding as South Africa’s mining sector continues to evolve. This offers significant growth and policy influence. In recent months, a wave of international law firms has closed their doors in South Africa. They cite challenges like economic uncertainty. As a mining lawyer, I have a deep-rooted belief in this country’s potential.

The past year has seen various developments in mineral and upstream petroleum law in South Africa which should be considered ahead of Mining Indaba 2024.

A recent Supreme Court judgment has clarified that ministerial consent under section 11 of the Mineral and Petroleum Resources Development Act (MPRDA) is needed for both direct and indirect changes of control of a company that holds mining rights.

Illegal mining is a critical challenge in the South African mining and minerals industry. The South African government previously recognised the potential of small scale mining operations to increase the portfolio of minerals being produced and possibly lead to the exploitation of resources that would otherwise be sterilised.

Mining companies are under increased pressure from regulators, investors, and communities to manage social and environmental risks arising from mine closure and rehabilitation. Abandoned mines and their dumps are common features of the South African mining landscape.

There are key consequences of the Gauteng Division of the High Court's decision in Minerals Council of South Africa v The Minister of Mineral Resources and Energy and Thirteen Others (Case No. 20341/19) (Mining Charter III Judgment).

Total S.A.'s (Total) initial discovery just over two years ago of gas concentrate in the Outeniqua Basin (Brulpadda prospect, Block 11B/12B) offshore South Africa, a deposit reportedly containing around one billion barrels of oil equivalent, has placed a spotlight on the potential of South Africa's upstream oil and gas industry.

Recent regulatory developments have helped to increase the pressure that communities are able to exert on mining companies. This highlights the need for companies to implement more effective negotiations with and solutions for their affected communities.

Mining Charter III (MCIII) heaps more pain on South Africa’s alluvial diamond producers who already face enormous cost burdens and high risks. This previously productive and successful small or junior diamond mining industry consists of just 180 remaining entrepreneurial mining operators employing around 5,000 people at an annual salary bill of R550 million.

Achieving Mining Charter III’s requirements for structuring broad-based ownership, local procurement and social and labour plans is likely to present serious challenges for small scale miners in particular. It may be time to move away from a 'one size fits all' approach in setting charter targets.