Mineral and Petroleum Resources Development Amendment Bill: briefing

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Mineral Resources and Energy

09 May 2007
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MINERALS AND ENERGY PORTFOLIO COMMITTEE
9 May 2007
MINERAL AND PETROLEUM RESOURCES DEVELOPMENT AMENDMENT BILL: BRIEFING

Chairperson: Mr E N Mthethwa (ANC)

Relevant documents:
Presentation on Mineral and Petroleum Development Amendment Bill
Mineral and Petroleum Resources Development Amendment Bill [B10-2007]
Mineral and Petroleum Resources Development Act 28 of 2002

SUMMARY
The Deputy Director General from the Department of Minerals and Energy gave a briefing on the Mineral and Petroleum Resources Development Amendment Bill. Most of the amendments were of a technical nature with the aim being to remove ambiguities in definitions. The amendments were also geared towards aligning environmental impact assessment (EIA) requirements with the norms and standards laid out in the National Environmental Management Act No 107 of 1998. Other aims of the amendments include the addition of functions to the Regional Mining Development and Environmental Committee and the re-evaluation of transitional arrangements with a view to further statutory protection to existing old order rights. The amendments were largely uncontested with the exception of the Chairperson’s suggestion that more focus be dedicated to the matter of security of supply. Public hearings are scheduled for 28 May 2007.

MINUTES
Mineral and Petroleum Resources Development Amendment Bill: briefing
Mr Abe Mngomezulu, Deputy Director General of the Department of Minerals and Energy (DME) gave a brief and informative presentation of the Mineral and Petroleum Resources Development Amendment Bill. He commenced by acknowledging the expertise of his fellow colleagues responsible for conceptualising the amendments to the principal Act: Ms M Ledingwane, Ms L Mekwe, Ms E Swart, Ms S Mudau and Mr D Mailula.

Mr Mngomezulu explained the rationale behind the amendments.

The Amendment Bill aims to eradicate technical errors and add clarity to certain ambiguous definitions and concepts. Mr Mngomezulu highlighted three previously undefined concepts that the Bill addresses. In the principal Act there were no prescriptions regarding base levels, this has been rectified in the Bill by defining four different stages of beneficiation. Second, the Council for Geoscience has been clearly defined and attributed with certain responsibilities, namely to be the custodian of prospecting information. Third, the conceptual framework relating to environmental issues has been expanded and clarified.

A further technical amendment relates to an alteration of the name and composition of the Minerals and Mining Development Board. The minimum number of members has been increased from fourteen to seventeen, and the maximum number of members has been increased from eighteen to twenty. The name has been changed to include “petroleum” and hence becomes “The Minerals and Mining Development Petroleum Board”.

The Amendment Bill also aims to clarify the separation of powers by distinguishing the DME from the Finance Ministry. The DME Minister is authorised to levy fees in terms of the principal Act, and the Minister of Finance bears responsibility for determining state royalties.

Through the Amendment Bill there will be greater alignment with the requirements of the National Environmental Management Act No 107 of 1998 (NEMA). The Bill provides clarity on EIA definitions and procedures as well as on the process of issuing environmental authorisations. Furthermore the Regional Mining Development and Environmental Committee (REMDEC) will be enabled to make recommendations to the Minister on environmental issues. The Bill also makes provision for addressing a mine’s cumulative impact and provides for appropriate closure procedures in this regard.

The existing old order rights will be fortified through the proposed insertions of the Bill. The Transitional Chapter in the principal Act has been amended to rectify certain omissions such as mynpachten and tributing agreements.

Finally, the Bill seeks to refine the appeal and review process of administrative decisions by making provision for a period by which an appeal is lodged.

Mr Mngomezulu then noted the various consultations that informed the process of drawing up the Bill. The following government departments were consulted: National Treasury, Department of Land Affairs, Department of Environmental Affairs and Tourism and the Department of Water Affairs. Other institutions involved include the Petroleum Agency South Africa (PASA) and the Council for Geoscience (CGS).

In conclusion Mr Mngomezulu stressed that the Bill did not entail any deviations from the substantive thrust of the principal Act and Mining Charter. The technical amendments would ensure the efficient and effective administration of the state’s mineral resources along with the promotion of cooperative governance between different state organs. The Bill brings the principal Act into alignment with other legislation such as: NEMA, Mining Titles Registration Act No 16 of 1967, Diamond Amendment Act No 29 of 2005, Diamond Second Amendment Act No 30 of 2005 and the Mine Health and Safety Act No 29 of 1996.

Discussion
The Chairperson thanked Mr Mngomezulu for his presentation and noted that the bulk of the work would be done in the public hearings scheduled to take place on 28 May. The public hearings would afford all stakeholders the opportunity to voice their concerns.

Mr C D Kekana (ANC) asked Mr Mngomezulu to elaborate on the four-stage beneficiation process as outlined in the Bill.

Mr Mngomezulu explained the four-stage process by using the example of a gold mine. The primary stage includes any recovery or extraction process so in the case of a gold mine this would relate to the crushed rock stage. The secondary stage includes any process of conversion into an intermediate product, in this case ore. The tertiary stage includes any further conversion into a refined product suitable for purchase by a minerals based enterprise, in the case of gold mining this would relate to gold refined to the base level. And the final stage includes the production of properly processed, cut, polished or manufactured products.

In reply to the Chairperson asked if persons from the industry were included in the consultation process, Mr Mngomezulu said that there had already been extensive consultation with key players in the industry and that this consultation would be ongoing. The media had in fact reported on this broad consultation.

The Chairperson inquired as to why the amendment process had taken so long and whether such highly technical amendments were necessary.

Mr Mngomezulu explained that the correction process had started in 2005 and had then been halted due to a need to focus on urgent legislation that needed to be processed as quickly as possible.

The Chairperson raised the issue of security of supply and asked if this had been adequately incorporated into the Bill.

Mr Mngomezulu replied that the question of security of supply was in the current document but that he would re-visit the issue to ensure that there is sufficient attention dedicated to the matter.

The Chairperson referred all present to the public hearings on 28 May and adjourned the briefing.


 

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