Mineral Resources Minister Ngoako Ramatlhodi has focused sharply on plans to speed up transformation in South Africa’s mining sector and enforce compliance with the Mining Charter.

During his budget vote on Tuesday, he told the National Assembly that he was prepared for any eventuality flowing from the controversial  Mineral and Petroleum Resources Development Act (MPRDA) Amendment Bill, which was approved by Parliament on March 12 and referred to President Jacob Zuma.

“Having spent time listening to stakeholders and taking cognisance of the fact that under our Constitution, a Bill before the President can be referred back to Parliament if it cannot muster a Constitutional test, I am ready for any eventuality.”

He said that, if the current Bill was assented to in its current form, he was committed to "rigorous and transparent engagement with stakeholders on draft regulations".

However, Ramatlhodi told an earlier media briefing in Parliament that he was not prepared to let the process lag.

“We need certainty on policy but we also need to move with speed to get certain things done.”

Concerns have been expressed about aspects of the legislation such as allowing government a 20% free-carry interest in all new exploration and production rights in the oil and gas sector. Ramatlhodi told journalists the State could negotiate further.

“At some point, we need to limit the amount the State can take so that we can allow investors to get returns. Investors need to invest with the intention of making reasonable profits. The figures can be discussed around those principles.”

The Minister said he had set up an inter-Ministerial committee to deal with concerns by stakeholders in the mining and upstream petroleum industries on the MPRDA Amendment Bill.

He added that concerns would be addressed through the development of "robust regulations" to provide greater certainty, as well as to encourage continued investment in the mining sector.

On transformation, he said government would be vigilant about issuing mining licences only to companies that were committed to change.

He said if conditions were not adhered to, licences could be revoked.

With the Mining Charter on transformation marking its tenth year, he expected "100% compliance" from companies.

“We will be keenly looking at this. We’ll also be issuing directives to companies to encourage them to hurry up compliance. We can withdraw licences and we will do that if need be,” he told the media briefing leading up his budget vote debate.

He said companies had to comply with a minimum of 26% black economic empowerment.

He added that a key requirement of the Mining Charter was for mining companies to improve housing and living conditions of mineworkers, which included the conversion of all hostels into family units.

The Minister noted that the regulatory environment relating to mine health and safety was also being reviewed, while the Department of Mineral Resources (DMR) was collaborating with various departments to ensure that the principle of equal pay for work of equal value in the mining industry was ascribed to.

SHALE GAS
The DMR said it needed to finalise regulations around the Square Kilometre Array telescope, which is being developed in the Karoo region, and was also looking at water and environmental issues before issuing licences for the exploration of shale gas in the Karoo basin.

Ramatlhodi told journalists government was consulting with communities in the Karoo, as well as with the Treasure the Karoo Action Group, with the aim of unveiling a communications strategy.

“We believe we have a proposal that will take the country forward. We believe we have a game-changer and we want people on board.”

Ramatlhodi told Parliament that, while the industry had experienced numerous challenges recently, this should not detract from the "immense development potential" that existed in the country.

“We sit at a crossroads in the history of resources development in our country. The potential of the upstream petroleum industry, both shale gas and increasingly offshore deep-water oil and gas, is profound, and if stewarded properly, has the potential to drive the development of our economy for all our people in a manner contrary to the historic injustice afflicted upon our people by the mining industry.”

Meanwhile, the Minister also revealed to the National Assembly that his department was committed to exploring the possibility of establishing a diamond bourse in South Africa to the benefit of beneficiation on home ground, as well as achieving favourable pricing for industrialisation.