JOHANNESBURG (miningweekly.com) – The proposed changes to South Africa’s Minerals and Petroleum Resources Development Act (MPRDA), especially around community interest and environmental regulation, were likely to add to delays currently experienced in acquiring mining and exploration rights.

Law firm Webber Wentzel partner Manus Booysen said that the Amendment Bill would give the country’s Minerals and Energy Minister the power to impose conditions around community involvement and possibly withhold a mining or exploration right if these conditions were not met.

Booysen noted that although community involvement was important, the department would have to become more involved in community issues to ascertain the needs of the affected communities.

The Amendment Bill would also move the responsibility of environmental regulation from the Department of Minerals and Energy (DME) to the Department of Environmental Affairs and Tourism (Deat).

Booysen noted that moving the authority to approve environmental impact assessments (EIAs) could add to confusion and further delay the process.

Booysen stated that the current MPRDA already had a significant amount of obligatory timelines that government had to adhere to and the Amendment Bill proposed to introduce several more. However, he said that these timelines were without meaning, as no effective sanction could be imposed against government if it failed to meet these timelines.

The Minister said in February that the process time for prospecting rights had been reduced to six months and for mining rights to one year, but Booysen said that these timelines were not being adhere to and was in any event too long.

The number of mining and exploration rights granted was also worrying, as only one out of 1 163 prospecting rights was granted between June and November 2007 and five out of 453 mining licences during the same time.

The conversion of old mining rights into new order mining rights was also taking a significant amount of time. Booysen noted that at the start of this year, only about 25% of conversions had been granted.

The Chamber of Mines estimated that these delays had cost the country between R5-billion and R10-billion, Booysen noted.

A report complied by Canada-based Fraser Institute, which analyses the perceptions about the attractiveness of 71 countries for investment in exploration, has placed South Africa at forty-ninth out of all the countries surveyed.

Factors taken into account, included regulatory regime, labour relations, taxation regimes and political stability. The survey found that the biggest issues surrounding South Africa was regulatory uncertainty, regulatory duplication and inconsistency, and land claims uncertainty. And, to a far lesser extend, infrastructure development, which the Minister had blamed for a lack of mining investment in South Africa.

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