Modern Mining March 2022

EXPERT VIEW

Bring back to life old gold mines, boost ESG investments for South Africa

By Sunday Mabaso, CEO of Vahlengwe Mining Advisory and Consulting Recent statistics released by StatsSA indicate that the South African mining sector continues to contribute immensely to the country’s GDP, despite the current challenging economic environ- ment. This good performance is attributed mainly to the high commodity prices of gold, platinum group metals and iron ore. In particular, the economic growth for gold mining in the past two years has seen various mining houses declare very healthy profits in their annual performance reports.

T his is an indication that there is an opportunity for mining companies to pursue abandoned gold mining assets, particularly those closed for reasons related to liquidation and low- grades. Blyvoor Gold Operations, Central Rand Gold Mine (CRG), and Mintails, are examples of gold min- ing assets that were abruptly discontinued due to liquidation and which subsequently exposed local communities to environmental and social risks. The adverse ef fect s they pose rema in unaccounted for, which causes challenges for stakeholders, namely regulators, local munici- palities, landowners, property developers and communities at large. The biggest challenge is that most of these operations were closed with no finan- cial commitment to rehabilitation of the areas post closure of the mines, despite this being a require- ment of the Department of Mineral Resources and Energy (DMRE).

Resuscitating old gold mines can help invigorate the economy. We also cannot ignore the fact that there is a significant disconnect in the Mineral and Petroleum Resources Development Act (MPRDA) and the Companies Act regarding liquidated mining com- panies, which limits the powers of the DMRE on enforcing post mine closure requirements. It can further be argued that Section 28 of the National Environmental Management Act (NEMA) empowers the DMRE as a competent authority to hold the direc- tors of the liquidated mining companies to account for environmental damages. However this has, to date, not proven to yield the required accountability for reasons including transitional arrangements in the MPRDA and NEMA. Despite all of this, it is encouraging to see that

There is an opportunity for mining companies to pursue abandoned gold mining assets.

companies such as Pan African Resources and Amatashe Mining have shown an interest in pursu- ing some of the assets mentioned above. This will grant regulators the opportunity to rectify the loopholes and ensure that there is full implementation of closure requirements for sustainable l ivel ihood post-mine closure, as proposed in the Draft Mine Closure Strategy published by the DMRE for comment. Notwi thstanding the Mine Closure Strategy is still a draft; it proposes strategic plans that can be implemented immediately to remedy the challenges experi- enced by current mine closures for future sustainable develop- ment ; a phenomenon which

34  MODERN MINING  March 2022