trending Market Intelligence /marketintelligence/en/news-insights/trending/skrl301ccow9ahavhx55ka2 content esgSubNav
In This List

Mining executives react to South Africa's new Mining Charter

Blog

Insight Weekly: US stock performance; banks' M&A risk; COVID-19 vaccine makers' earnings

Blog

Insight Weekly: LNG exports surge; investors unfazed by inflation; neobanks drive VC funding

Blog

Essential Metals Mining Insights November 2021

Blog

[Infographic]: 2021 World Exploration Trends


Mining executives react to South Africa's new Mining Charter

The new "third" Mining Charter was a key talking point at this year's Joburg Indaba conference in Johannesburg. Here are some of the voices that commented on the new legislation.

* Roger Baxter, CEO of the Minerals Council South Africa, said the new charter provides a clear and durable framework for the industry and policy certainty for investors.

"We believe that the charter is a substantial improvement. We are definitely in a harsh environment in terms of commodity prices on a global level, but we are also seeing a new dawn, driven by the minister, by the new charter."

The legislation is not yet officially in force, and guidelines around the charter will be developed in the next two months. Baxter said it remains crucial to take this opportunity to create long-term certainty.

"It is the change that causes the uncertainty; we need to embed it for the next 10, 15 years, and it needs to be competitive."

While the Minerals Council lauded the changes in the new charter overall, it flagged the need to address some remaining issues with Mining Minister Gwede Mantashe. These include the turnover threshold for junior miners, targets for services, the treatment of renewals of mining rights as new rights, the practicality of inclusive procurement provisions, and the limited applicability of continuing consequences of past transactions on disposal of Black Economic Empowerment stakes.

* Deshnee Naidoo, CEO of Africa Base Metals and Konkola Copper Mines at Vedanta Resources PLC, called for more efforts to create and embrace a shared vision for the sector.

"We have made a very positive change in the industry over the last ten years. And it is good that we are now moving towards regulatory and policy certainty. What we need now is embedding it."

Naidoo urged regaining lost momentum and creating a shared vision for South Africa's mining industry, spanning exploration, investment aspects, technology and innovation.

"Create a shared vision, and make sure that we can catch up as quickly as possible. Why have we not become more competitive over the last years? It is because we have not embraced [innovation and technology] the way the rest of the sector has in Canada, Australia etc."

* Joseph Mathunjwa, president of South Africa's Association of Mineworkers and Construction Union, criticized the charter for not addressing key issues in the mining industry.

"I am negative about the way the minerals are exploited. The minerals must serve the nation, not just individuals."

* Mike Teke, CEO of Seriti Resources Pty Ltd., was full of praise for the personal engagement Mantashe showed during talks over the new mining charter.

"Different from the previous regime, I believe that the level of consultation [this time] is admirable and we appreciate that. [Mantashe] did his best to consult with all stakeholders, and today I believe we are headed in the right direction to [end] the regulatory uncertainty and restore confidence in our mineral resources legislative regime."

Teke also welcomed Mantashe's efforts in dealing with the pending Mineral and Petroleum Resources Development Act.

"[This] has been hanging over our heads for a long time. His actions will ensure that we avoid destroying the industry. We cannot satisfy everybody, but we must try to look for solutions; we must support the minister now. I am optimistic that we will close this charter successfully."

* Various delegates were critical of the charter for not sufficiently focusing on the exploration and junior mining sector. "It falls way too short in that respect," said Sifiso Nkosi, executive chairman of Ntuthuko Exploration & Mining. "There is only one section that speaks about the junior mining industry."

* Nicola Jackson, vice president for business development and legal at Sibanye Gold Ltd., described the new charter overall as a "job well done" but urged the government to clarify the status and timeline for implementing the new rules.

"My concern still remains the legal status and validity of that document. We need to sort it out."