Question NW91 to the Minister of Mineral Resources and Energy
08 March 2024 - NW91
Phillips, Ms C to ask the Minister of Mineral Resources and Energy
(1) With reference to 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, what total amount of the R296 million is owed to the Department of Mineral Resources and Energy in the North West, (2) what is the total amount owed in fees by companies who applied for (a) prospecting rights, (b) licences and (c) permits in the Bojanala area; (3) whether the licences and permits will be withdrawn as a result of the non payment of fees; if not, why not; if so, on what date will they be withdrawn; (4) whether the interested and/or affected parties will be notified that their licences and permits have been withdrawn; if not, why not; if so, (a) how and (b) on what date?
Reply:
1. 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.
- Non commencement of prospecting activities and inactive prospecting rights
- Frivolous applications with a view to speculate with the right
- Less than promising results from initial prospecting rounds compared to prospecting costs incurred
- In some cases delinquency on the part of right holders.
- Right holders entered business rescue or the holder of the rights are liquidated
- Non traceable right holders
- Relinquishment of rights without notifying the regulator
2. The total amount of debt relating to Bojanala district right holders’ debt is approximately R510 079.62
3. Prospecting rights can be cancelled after all administrative process have been followed. The right holders are informed on their default in payment of prospecting fees. An order/instruction is then issued in terms of section 93 of the MPRDA non-complying right holders to demand payment. If the right holder fails to make payment, section 47 (intention to cancel the right) is issued. A specific date cannot be determined as this is an ongoing process.
4. The right holder is notified once the right has been cancelled. A specific date cannot be determined as this is an ongoing process.