Draft Mineral and Petroleum Resources Development Bill: The Introduction of Artisanal Mining Regulation
1. Introduction
The Draft Mineral and Petroleum Resources Development Bill (herein, ‘Draft MPRD Bill’) proposes a number of amendments to the Mineral and Petroleum Resources Development Act 28 of 2002 (herein, ‘MPRDA’). One of the focal areas for which amendments have been proposed is the regulation of ‘artisanal mining’ and ‘small-scale mining’. To put the matter into context, this blog will assess five aspects of the artisanal mining regulatory scheme. Comparisons are drawn from Kenya as another renowned mining jurisdiction that has separated the regulation of artisanal mining from small-scale mining. Kenya acts as a viable comparator given the organization of its mining legislation, which is similar to that of South Africa. Other similarly structured artisanal mining regulatory schemes include; Burkina Faso, Côte d’Ivoire and Sierra Leone.
2. Scope: What is being Regulated?
The definitional section of the Draft MPRD Bill outlines artisanal mining as the [traditional or customary] mining of minerals on the surface, or at shallow depths using rudimentary [or manual] tools. This is an expanded definition of the Kenyan conception of artisanal mining, which comes down to the same scope as that adopted by South Africa, “traditional and customary mining using traditional or customary means”.
The scope adopted by South Africa in the Draft MPRD Bill is the same as that which has been widely used in artisanal mining regulation elsewhere, though not as elaborate as what is covered in resources such as the African Mining Legislation Atlas (‘AMLA’) Guiding Template. The AMLA Guiding Template states that artisanal mining is primarily focused on producing mineral products that are either sold or delivered by traders, local artists, craftsmen or builders within the national economy. Having said this, the articulation of the regulatory scope of artisanal mining in the Draft MPRD Bill is still relatively straightforward, a good trait of effective industry regulation.
3. Eligibility: Who Qualifies for an Artisanal Mining Permit?
Section 27A(2) of the Draft MPRD Bill states that ‘any’ person qualifies for an artisanal mining permit. The Draft MPRD Bill thus maintains the eligibility requirement outlined under Section 27(2) of the MPRDA, the statutory provision from which the proposed amendment was conceptualised. The articulation of the requirement is not as elaborate as the Kenyan version, which specifies that persons wishing to apply for an artisanal mining permit must be a Kenyan citizen who has attained the age of majority [18 years] – further providing that such Kenyan major may form part of an artisanal mining cooperative association or group.
In ensuring that local community mining entrepreneurs and the general community benefit from artisanal mining operations, best practice , as outlined in the AMLA Guiding Template, requires that the mining law must restrict the eligibility to local nationals and cooperatives or corporate entities composed of local nationals. The rationale being to enable local nationals to [solely] benefit from the mineral resource wealth deposited within their communities.
4. License Requirements: What Information must the Applicant Adduce in the Application to the Regulatory Authority?
The Draft MPRD Bill maintains much of the same wording used in Section 27 of the MPRDA when it comes to the application requirements. First, Section 27A(2)(a) of the Draft MPRD Bill provides that the application for an artisanal mining permit must either be made at the regional office of the Department of Mineral Resources and Energy (herein, ‘DMRE’), where the [identified] land is situated or on the designated [online] application system.
Second, Section 27A(2)(b) of the Draft MPRD Bill provides that the application must be made in the ‘prescribed manner’. Under Section 27(2)(b) of the MPRDA, the ‘prescribed manner’ was as per Form F, as referred to in ‘Annexure 1’ of the MPRDA Regulations. At the time of writing this, it is unclear whether artisanal mining permission applications will adopt the same Form. The Form requires information such as:
- Financial Capacity and Technical ability of the applicant to conduct the mining operations, as well as to mitigate and rehabilitate environmental impacts.
- Certified copies of land titles.
- Quantities of minerals intended to be removed and disposed of.
Other administrative requirements include: particulars of the applicant, including their certified identity document copy; description of the land or area for which the artisanal mining permit is sought, as well as a declaration of truth and correctness.
Third, Section 27A(2)(c) of the Draft MPRD Bill, provides that the application must be accompanied by the prescribed non-refundable application fee. The non-refundable fee for a MPRDA Section 27(2) mining permit application is R100.
The Draft MPRD Bill’s administrative requirements are similar to those of the Kenyan mining law, except that Kenya [further] requires the landowner’s consent where the land is not designated as an artisanal mining area. Best practice requirements are that the application must indicate:
- The applicant’s capital and experience to conduct the mining operations efficiently and effectively.
- The applicant’s mining plan demonstrating how the artisanal mining will be carried out.
- Documentation showing that the applicant has obtained consent from the landowner or the traditional authority where applicable.
- The period applied for.
- Particulars of the artisanal mining operational programme covering issues such as: the likely social and environmental impact of the proposed artisanal mining operations and any compensatory measures; risks associated with the proposed artisanal mining operation, as well as the proposed marketing arrangements concerning the sale of the minerals.
Indications are that if the South African Legislature was to adopt the application requirements as outlined in Section 27A(2) of the Draft MPRD Bill, South Africa would be on par with best practice, concerning artisanal mining permit application requirements.
5. Granting of Rights: What is the Procedure for Granting Artisanal Mining Permits to Successful Applicants?
Once the artisanal mining permission is lodged, the Minister of Mineral Resources and Energy (herein, ‘Minister’), must accept such application made by an applicant if:
- The artisanal mining permission application requirements are met.
- No other person holds a mining right for the same piece of land granted in terms of the MPRDA [in this case, the amended MPRDA].
- Granting of the artisanal mining permission will not result in the applicant being granted more than one artisanal mining permission on the same or adjacent land.
- No mining right granted in terms of the MPRDA has been accepted for the same mineral on the same land.
Where the Minister accepts the artisanal mining permission application, they must notify the applicant in writing, within 14 days, as prescribed by the MPRDA Regulations, to consult with the landowner, lawful occupier and any interested or affected parties. Once the applicant has consulted the aforementioned parties and submitted the result of such consultation to the Minister, the Minister must attach such consultation feedback to the environmental report. After consideration, the Minister, within 30 days of receiving the application, must issue the artisanal mining permit if the applicant has: satisfied the aforementioned administrative requirements, been issued an artisanal mining environmental authorization and demonstrated that they have the ability to comply with health and safety guidelines. Aggrieved affected persons may object to such artisanal mining permit at the Regional Mining Development and Environmental Committee which will adjudicate over the objection and advise the Minister on the process.
It must be noted that Section 9A(1) of the Draft MPRD Bill states that the Minister can invite applications for artisanal mining permits in three instances:
- In designated areas.
- In respect of land or minerals that were relinquished or abandoned.
- For minerals that were previously subject to any right, permit or permission in terms of the MPRDA but were cancelled, relinquished, abandoned or lapsed.
Once granted, the artisanal mining permit must be registered with the Mineral and Petroleum Titles Registration Office within 30 days of issue.
The Kenyan procedure, as enumerated in its mining law, is not as elaborate as that of South Africa with regard to permit approval decision-making process. In Kenya, once the applicant has satisfied all the requirements, the representative of the Director of Mines is charged with notifying such applicant of the outcome of their application within a ‘prescribed time’.
The specification of the time frames over which the decision-making process will ensue, as outlined in the Draft MPRD Bill, puts South Africa on par with best practice requirements.
6. Term and Renewal of License: The Period for which an Artisanal Mining Permit can be Held and the Procedure for Renewing such Permit
Section 27A(1)(a) provides that the term of the artisanal mining permit is a maximum of 2 years. The period is 1 year less than what is applicable in Kenya, where the term of the artisanal mining permit is 3 years. The position taken in the Draft MPRD Bill falls within the 1 to 3 years period in accordance with best practice.
Artisanal mining permit holders wishing to renew their permit must apply to the Minister, at the office of the DMRE within the region where the land is situated or on the [online] designated application system, in the prescribed manner together with the prescribed non-refundable application fee. The application for renewal of the artisanal mining permit must provide reasons for the renewal of the permit and have a report demonstrating compliance with the conditions of the artisanal mining environmental authorization attached to it. Once the application for renewal is approved, the artisanal mining permit will be renewed for a period 2 years.
The Kenyan renewal procedure is not as extensively explained [in its mining law] compared to the South African renewal procedure. All it provides is that a holder of an artisanal mining permit may apply for renewal of such permit. If the application for renewal is successful, then the artisanal mining permit will be renewed for 3 more years. The Kenyan mining law specifies that the artisanal mining permit may only be renewed once. The position adopted by South Africa as outlined in the Draft MPRD Bill concerning the renewal of the artisanal mining permit is within the 1 to 3-year range, in accordance with best practice.
7. Key Takeaways
The Draft MPRD Bill introduces the regulation of artisanal mining [traditional or customary mining of minerals using rudimentary tools] in South Africa. The Draft Bill is on par with best practice with regard to its [administrative] artisanal mining permit requirements such as: the granting of [artisanal mining] rights; term of [artisanal mining permit], as well as renewal of [artisanal mining permit] procedure and period. The South African legislature has elected to maintain the eligibility criteria, observed under Section 27 of the MPRDA[mining permit provision], allowing ‘any’ person to be eligible to apply for the artisanal mining permit – an eligibility design decision that is not aligned with best practice.