Pieter Badenhorst

Security of Mineral Tenure in South Africa: Carrot or Stick?

The notion and features of the security of South African mineral tenure are discussed in this article. On enactment of the Mineral and Petroleum Resources Development Act, 28 of 2002 (MPRDA) on 1 May 2004, a radical new mineral law regime was introduced in South Africa. The state acts as custodian of all mineral resources and is responsible for security of mineral tenure as one of the objectives of the MPRDA. The MPRDA is examined in order to determine to what extent security of mineral tenure is provided. Examination takes place against the background and the strikes and violence that plagued the South African platinum industry during 2012–2013, as external factors that may impact indirectly on security of mineral tenure. Security of mineral tenure also has to be viewed within the context of the transformation objectives of the MPRDA. It is found that security of mineral tenure is afforded to current holders of prospecting rights and mining rights and some former holders of old order rights. It is shown that the holders of unused old order rights were not afforded security of tenure and were unsuccessful in claiming compensation in the courts for their loss of former rights. It is indicated that such loss should be viewed within the context of constitutionally based transformational goals of redress and access to the mineral resources. It is argued that the security of tenure is also affected by external factors, the manner in which the Department of Mineral Resources administers the statute and recent case law. Security of mineral tenure should be viewed in a broad sense to determine its true extent. Security of mineral tenure should be seen and cherished by the South African Government as a tool to attract foreign investment rather than a stick to achieve short-term political outcomes.

Exodus of 'mineral rights' from the South African Mineral Law

Transformation of the mineral law system as part of the new political dispensation in South Africa has long been foreseen. Subsequent to a Green and White Paper, as policy documents, the Department of Minerals and Energy published a Mineral Development Draft Bill 2000 for public comment. This eventually culminated in the acceptance by Parliament of the Minerals and Petroleum Resources Development Act 28 of 2002, which came into operation on 1 May 2004. The Act will transform the mineral law system and the mining industry in general. In this article the phasing-out by the Act of the historical notion of ‘mineral right’ is examined. it is argued that the Act will lead to an exodus of the notion of mineral rights and will replace it with less secure prospecting rights and mining rights which, albeit real in nature, will depend on compliance with provisions of the Act and the exercise of discretion by the Minister.