Tag Archive | energy legislation

MPRDA Bill to be amended urgently

Some form of compromise….

coal miningIn referring back to Parliament the Mineral and Petroleum Resources Development Amendment Bill (MPRDA) and acknowledging in his State of Nation Address (SONA) that in its present form it could be damaging to South Africa’s investment climate, President Zuma and his cabinet have introduced more certainty to both the mining and oil and gas industries.

At least a year and a half delay was a guess if the suggestion that two replacement Bills were to be drafted separating mineral resources from oil and gas in the light of the fact that both have separate BEE charters.

Certainty needed

However, mineral resources minister Ngoako Ramatlhodi has agreed with mining companies and also the point put forward by Chamber of Mines that the best and fastest way forward to bring certainty to theRoughnecks wrestle pipe on a True Company oil drilling rig outside Watford industry would be to pass the Bill subject to amendments based on a new approach to the mining beneficiation issue and the matter of state “free carry” in any successful gas exploration.

Originally, on an issue raised both in submissions and by opposition parties and, even a couple of ANC MPs, the presidency has also agreed to doubts expressed whether, once signed, the MPRD Act after amendment would pass constitutional muster on the basis of the amending Bill’s passage through Parliament and the process adopted.

Section 79(1) of the Constitution empowers the President to return a Bill to Parliament for reconsideration if reservations about the constitutionality of the Bill prevail.

Mining land

Subsequently pointed out as a further reason for the Bill not beingtrad leaders signed, raised in a presidency statment issued by spokeperson Mac Maharaj, was a concern of cabinet that the Bill had to be processed through the Council of Traditional Leaders.

Parliament passed the Bill all in a rush at the end of March 2014 after much lobbying by ANC whips and despite warnings and constitutional challenges from many parties.  Nearly a year has passed since sending the proposals off for presidential assent.

The subject of the regulatory environment has not even been touched upon or has come up in the debate at this stage.

During the parliamentary recess both the Chamber of Mines and others have complained of sustained uncertainty in their industries and in the investment world.

Two issues emerged almost immediately when the President announced he was delaying his signature. The first issue was a hefty warning from mineral resources minister Ngoako Ramatlhodi who said “the implications for companies that did not meet BEE targets set out in the mining charter would be severe”, inferring that this might eventually affect the granting of mining licences. He raised, once again, the issue of employee shareholding.

“Developmental” metals pricing

Consequently, it still remains somewhat foggy what government policy was in instituting such clauses other than an overall ambition for the state to have more ownership of strategic resources in both industries and the drive by minister of trade and industry, Dr Rob Davies, to assist smaller manufacturing metals industries becoming more viable at the cost of larger industries, therefore creating more jobs, he said.

On the subject of BEE and the two different charters affected, all that has been said officially was a remark by minister Ramatlhodi “We have to satisfy ourselves that the Act meets our broader socio-economic development activities.”

The second issue to emerge after the announcement of the return of the MPRDA to Parliament was further mention by the department of energy of“Operation Phakisa”, the speed-up process as part of a co-ordination exercise with the oil and gas industry to reduce reliance on oil imports.

Fracking and renewables

On a separate issue, further statements by ministers with regard to fracking and speeding of delays in the IPP world with renewables has also emerged, overshadowed by the urgent need of an energy plan from the newly formed energy “war room”.

Whatever happens, both industries should be prepared for another round of public comment, hopefully in the first parliamentary period after the Budget…… minister of finance Nene notably mentioning nothing of nuclear interest in his budget speech.
Other articles in this category or as background
Energy War Room formed to meet crisis – Parly ReportSA
Mineral and Petroleum Resources Bill halted perhaps – ParlyReportSA
Medupi is the key to short term energy crisis – ParlyReportSA

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