Posted: ’16-JUL-04 06:36′ GMT – Mineweb.net – Archive

MINEWEB: We now link up with Joacinto Rocha, who is the Chief Director of Licensing at the Department of Minerals & Energy. Joacinto, there has been some confusion on the black economic empowerment regulations – or how they apply to new mineral rights, new mining applications. You’ve taken the bull by the horns, and today released a clarification document. Perhaps you could focus for us on how the confusion was created in the first place.

JOACINTO ROCHA: I would say it was created in the newspapers. So who created it, we don’t know. But I think the most important thing is that there was clarification issued today.

MINEWEB: All right, we just take us through the clarification – how it will apply in future.

JOACINTO ROCHA: The clarification, one, states that this document here does not affect the rights relating to prospecting operations and mining operations. For that one, the 15% in five years, and 26% in ten years as contained in the charter, applies. Then we go further, where we state that in areas where we are dealing now with unused old-order rights, where the state is the holder of the mineral rights. The state as the owner will then require 51% BEE participation.

MINEWEB: If you were to take all the mineral rights in South Africa, what percentage does it apply to – where the 51% that will be needed?

JOACINTO ROCHA: I think that will not really be an appropriate question, because mineral rights are everywhere in South Africa.

MINEWEB: But the registered mineral rights – how many of them are owned by the state?

JOACINTO ROCHA: All mineral rights are registered in South Africa. So I think your question is in respect of those areas where there is potential for prospecting or mining, because this is where it is going. Generally what people say, generally, in terms of South Africa, two-thirds is privately held and one-third is state held. But it does not necessarily mean that the 51% would apply to the one-third.

MINEWEB: How come?

JOACINTO ROCHA: Because that one-third, quite a number of it is already held under mining rights, where there is a mining operation, or prospecting.

MINEWEB: But can you give us an indication – what I’m trying to get at is that, if the 51% requirement for a black company is relatively small in the whole picture, then there seems to have been a bit of a storm in a teacup here.

JOACINTO ROCHA: I think if one were to look at square inch or square kilometre, one may want to argue that it is small. But the important issue here is the state has clarified and says where it relates to unused old-order rights, and where the state is the holder of the mineral rights thereof, applications that are going to be lodged within the next year, in other words, from 1 May 2004 to 30 April 2005, the state will require 51%.

MINEWEB: Joacinto Rocha is the chief director of licensing at the department of Mineral & Energy. David, I don’t know if you could catch what was going on there, but it does appear that, if you already have the mineral rights, then it goes with the normal mining charter, 15% in 5 years, 26% ownership in 10 years. But if it’s something new, if you want to go and prospect the new areas, and the state has got the licence, it is not privately owned, you must have a black partner. That’s fair enough.

DAVID SHAPIRO: Yes. And I think maybe it is a storm in a teacup. It would have been nice to get some input from some prospective companies, where it might be important. That hasn’t been clarified. But we are not quite sure which areas it really applied to and how it was affect future operations going forward, particularly the large mining companies, or those that are already on the board.

MINEWEB: Most of the prospecting in South Africa is pretty well known, the prospective areas, and there was a comment by one of our colleagues, Gareth Tredway, who is also known as the quiz master extraordinaire on this programme, and focuses on the mining area, spoke to Con Fauconnier today, and Con Fauconnier said he welcomes this as a magnificent step forward – Con being the chief executive of Kumba. So organised mining thinks it’s a very good thing.

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