Maravi

(NEWS24) King Zuma's mines

COMMENT - Oh boo-hoo. Let me cry some crocodile tears for the unfair treatment of the privately owned mining sector. This also pretty much destroys the argument that the state should not be in the mining business - it is, not only in South Africa, but also in Venezuela, Chile, and Saudi Arabia. Set up by the CEF (see this article from 3 years ago). Read about the CEF, which is state owned.

King Zuma's mines
2011-02-20 19:04
Jacques Dommisse, City Press

Johannesburg - The state’s new mining company – heralded by some as a triumph for those pushing for nationalising South Africa’s mines – is bidding for no fewer than 128 ­prospecting and mining rights, and the scale of its intended operations has ­taken the ­mining industry by ­surprise.

It has already been awarded 10 ­prospecting rights, with another 16 in the final stages of approval and the balance at various stages of ­being processed. This was ­established by City Press from ­published records of the department of mineral resources.

The data sheds new light on the scale of operations of the state’s newly revived mining company – the African Exploration Mining and Finance Corporation ­(AEMFC) – which ANC Youth League leader Julius Malema has hailed as proof that the league’s push for ­nationalisation has worked.

This has been ­denied by ­President Jacob Zuma.

During his State of the Nation address Zuma spoke of the imminent ­official launch of ­AEMFC, which until now had been housed in the ­Central ­Energy Fund.

Unfair advantage

It was given the green light by Cabinet in December to be a ­stand-alone ­company. Industry and legal experts were shocked when told of the scale of the corporation’s interests.

There has been concern over the waiver of many application ­conditions which ­AEMFC ­received in 2009 from former ­minerals and energy minister Buyelwa Sonjica, and which many said gave it an unfair advantage in the industry, but the scope of ­AEMFC interests and potential interests had not emerged until now.

“It’s huge,” said Dr Koos Pretorius, a leading mining commentator and director of the Federation for a Sustainable ­Environment.

The number of applications by AEMFC in Mpumalanga alone was equal to the total number of rights for ­Anglo American, he said.

Peter Leon, a leading mining-law ­expert from Webber Wentzel Attorneys, said Sonjica had acted beyond her legal power in waiving for the corporation the obligations required by an applicant for prospecting or ­mining rights.

Commercial farmers

Leon said AEMFC intended to mine large parts of eastern Free State, currently used for commercial farming, but that if commercial farmers there launched a ­legal challenge the corporation’s ­application exemptions would likely be ­overthrown in court.

Pretorius said it was incredible that an environmental impact plan could be drafted without ­consulting interested parties as there was no other way to ­establish the amount of water that would be used, where it would come from and the long-term effects on the land.

Late last year the corporation was due to open its first mine – a coal operation called Vlakfontein which previously belonged to ­Anglo American – near Ogies in Mpumalanga.

The opening was ­cancelled, however, after ­concerned ­environmentalists established that the mine did not have a valid water licence, ­Pretorius said.

Meanwhile, Leon said South ­Africa needed an independent body to govern the issuing of ­mineral rights. According to him, government could not be judge, player and ­supervisor.

Conflict of interest

Willem le Roux, a lawyer at Brink Cohen Le Roux, said AEMFC had ­created an ­extremely unhealthy situation where there was a clear conflict of interest.

Frans Barker, the senior ­executive ­director of the Chamber of Mines, said: “We are not ­necessarily opposed to a state ­mining company, but the playing field must be equal.”

He added that the ministerial ­exemption granted to the ­corporation was of deep concern to the chamber.The chamber had already ­undertaken a significant amount of research into the role of the state in mining and would make this body of research available.

This week the corporation’s CEO, Sizwe Madondo, did not ­respond to ­repeated attempts by City Press for an ­interview and/or comment.

The mineral resources ­department also did not respond to requests for ­comment on AEMFC’s applications, the type of minerals it was applying for and confirmation of the number of ­active and awarded prospecting and mining applications.

Private mining companies – ­including Anglo American – also declined to ­comment.

- City Press

Labels: ANGLO-AMERICAN, JACOB ZUMA, MINING, NATIONALISATION, PARASTATALS

posted by MrK @ 7:30 PM