Mosebenzi Zwane. REUTERS/Siphiwe Sibeko
Mosebenzi Zwane. REUTERS/Siphiwe Sibeko

The poor relationship between the Chamber of Mines and the Department of Mineral Resources was highlighted ahead of an urgent court appearance on Friday, with the industry body levelling charges of inappropriate behaviour at the regulator, which strongly denied the claims.

The chamber alleged the department had ordered its regional offices to freeze all applications for mining and prospecting rights as well as mineral rights transfers between companies, a charge the department dismissed.

The latest spat comes as the chamber approaches the High Court in Pretoria on Friday to urgently interdict a proposed moratorium on new mineral rights by Mineral Resources Minister Mosebenzi Zwane.

The industry body argues Zwane is acting outside his powers under the Mineral and Petroleum Resources Development Act. This will be the first airing of one of three court processes brought by the chamber against Zwane and his department, challenging actions that threaten to burden the troubled sector with additional costs and cut off the life blood of the industry by freezing new mining and prospecting rights as well as transfers of existing rights.

On Friday, the chamber will seek to halt the moratorium.

Its second court challenge will be to interdict and review the new Mining Charter, which Zwane has suspended.

The chamber has a third process to secure a declaratory court order on the interpretation of the charters as to whether mining companies must be perpetually 26% black-owned or whether historic empowerment deals serve as credits.

Chamber president Mxolisi Mgojo said on Thursday the moratorium on new rights had come despite Zwane’s gazetted proposal for the halt being open for comment until August 4.

"It has come to the attention of the chamber that the Department of Mineral Resources head office has instructed all regional offices to stop processing any section 11, new mining right or prospecting right applications submitted by mining companies after July 19," he said.

The department hit straight back, denying the allegation.

"No decision has been taken by the minister to implement the moratorium. The statement by the Chamber of Mines today is therefore misinformed," it said.

Peter Leon, a partner at Herbert Smith Freehills, said the chamber was unlikely to make a frivolous allegation at a time of such heightened tension between the industry body and the department.

"The chamber is obviously responding to information provided by its members and is very unlikely to make allegations for which there is no factual basis, particularly when litigation is already under way," he said. "There would be a legal basis for affected companies to act against the minister and the [department] if their applications are effectively frozen."

seccombea@bdfm.co.za

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