Question NW90 to the Minister of Mineral Resources and Energy
08 March 2024 - NW90
Phillips, Ms C to ask the Minister of Mineral Resources and Energy
Whether, in light of the Auditor-General’s Consolidated Generals Report on National and Provincial Audit Outcomes 2022-23, which indicates a material irregularity of a likely loss of R296 million in relation to fees for prospecting licences, permits and rights that were not collected between April 2020 and March 2023, the licences, permits and rights were awarded without the relevant fees being paid; if not, what were the reasons that fees were not collected; if so, what are the reasons that this was allowed?
Reply:
Prospecting licences, permits and rights were awarded between April 2020 and March 2023. Prospecting Right holders are obliged to pay prospecting fees in terms of section 19(2)(f) of the Mineral and Petroleum Resources Development Act, 2002 (Act 28 of 2002) (as amended) (hereinafter referred to as the MPRDA). According to section 76(2) of the MPRDA Regulations a holder of a Prospecting Right must pay prospecting fees annually in advance and not later than 30 days from the commencement date of such right and thereafter not later than 30 days following the anniversary of each respective year of the right for the duration thereof.
Prospecting right holders usually pay the initial fees when the right is issued, however they fail to pay annual fees in subsequent years due to a variety of reasons. These include less than promising results from initial prospecting rounds compared to expended financial resources and in some cases delinquency on the part of right holders.
Despite efforts from each of the Regions to collect outstanding fees, some right holders failed to respond. These were escalated to State Attorneys for collection and in some cases, there was a positive response. In others, the Department failed to get response. In some cases, holders were not traceable and there were no activities on the site. In other limited cases the Directors were deceased.