President Jacob Zuma’s rejection of a bill amending the Mineral and Petroleum Resources Development Act came as a relief for players in the oil and gas sector but has frustrated the Chamber of Mines.
The chamber had urged that the bill be passed into law.
Zuma referred the bill amending the law governing the mining‚ oil and gas sectors back to the National Assembly on Friday‚ saying it did “not pass constitutional muster”.
The proposed changes to the act had sparked concerns from lawyers and companies in mining‚ oil and gas about the broad discretionary powers granted to the mineral resources minister. Further‚ the removal of time limits on the granting of mining and prospecting rights and the clauses around state ownership levels in the nascent oil and gas sector, had prompted fears they would block investment.
The Presidency said it had carefully considered the bill and the submissions received before referring it back to the National Assembly for “reconsideration”.
It is not clear which aspects of the bill were seen as problematic.
Allan Reid of law firm Cliffe Dekker Hofmeyer, said the way the bill was rushed through the National Council of Provinces was “unacceptable” and there had to be greater participation in reworking it.
“We’ve been in a static state for months on end‚ with nothing happening and uncertainty wearing down the industry.”
Peter Leon of Webber Wentzel said this was an opportunity to resolve the “flawed” provisions in the bill. These included greater ministerial discretion‚ the removal of time limits in the bill which were to be moved into regulations‚ and export restrictions on minerals by the mineral resources minister in consultation with the industry designated strategic.
Shortly after he replaced Susan Shabangu as mineral resources minister‚ Ngoako Ramatlhodi told Business Day in June last year that he had officially asked Zuma not to sign the bill‚ fearing lengthy and damaging legal challenges.
Ramatlhodi welcomed the president’s decision to refer the bill back. “ allow us to fully satisfy ourselves that the act‚ when it is eventually passed‚ adequately responds to our broader socioeconomic development objectives‚ while balancing these with our aims of remaining an investment-friendly destination‚” he said. But the Chamber of Miners was unhappy with the delays to finalising what has been a prolonged process to change the laws governing the mining sector‚ its chief operating officer Roger Baxter said.
“ ... clearly we are disappointed because one thing that is critically important in this current environment is to create policy certainty for the mining sector.”
Baxter said there had been nine “substantive” areas the chamber had concerns with during the formulation of the bill and these had been resolved through compromise. “We have to make sure whatever comes out of this process is legislation that is good for the country and the industry.”
Key to the amendments would be the underlying regulations‚ which are a work in progress within the Department of Mineral Resources pending the enacting of the amendments. The chamber expected to be consulted closely on these‚ Baxter said
The oil and gas sector welcomed the president’s referral of the bill back to the National Assembly.
“ step in the right direction‚” South African Oil and Gas Alliance CEO Ebrahim Takolia said.
“Had the bill been signed in its current form it would have curtailed SA’s fledgling upstream oil and gas exploration potential.” — BDLive
Relief as Zuma rejects bill amendment
The chamber had urged that the bill be passed into law.
Zuma referred the bill amending the law governing the mining‚ oil and gas sectors back to the National Assembly on Friday‚ saying it did “not pass constitutional muster”.
The proposed changes to the act had sparked concerns from lawyers and companies in mining‚ oil and gas about the broad discretionary powers granted to the mineral resources minister. Further‚ the removal of time limits on the granting of mining and prospecting rights and the clauses around state ownership levels in the nascent oil and gas sector, had prompted fears they would block investment.
The Presidency said it had carefully considered the bill and the submissions received before referring it back to the National Assembly for “reconsideration”.
It is not clear which aspects of the bill were seen as problematic.
Allan Reid of law firm Cliffe Dekker Hofmeyer, said the way the bill was rushed through the National Council of Provinces was “unacceptable” and there had to be greater participation in reworking it.
“We’ve been in a static state for months on end‚ with nothing happening and uncertainty wearing down the industry.”
Peter Leon of Webber Wentzel said this was an opportunity to resolve the “flawed” provisions in the bill. These included greater ministerial discretion‚ the removal of time limits in the bill which were to be moved into regulations‚ and export restrictions on minerals by the mineral resources minister in consultation with the industry designated strategic.
Shortly after he replaced Susan Shabangu as mineral resources minister‚ Ngoako Ramatlhodi told Business Day in June last year that he had officially asked Zuma not to sign the bill‚ fearing lengthy and damaging legal challenges.
Ramatlhodi welcomed the president’s decision to refer the bill back. “ allow us to fully satisfy ourselves that the act‚ when it is eventually passed‚ adequately responds to our broader socioeconomic development objectives‚ while balancing these with our aims of remaining an investment-friendly destination‚” he said. But the Chamber of Miners was unhappy with the delays to finalising what has been a prolonged process to change the laws governing the mining sector‚ its chief operating officer Roger Baxter said.
“ ... clearly we are disappointed because one thing that is critically important in this current environment is to create policy certainty for the mining sector.”
Baxter said there had been nine “substantive” areas the chamber had concerns with during the formulation of the bill and these had been resolved through compromise. “We have to make sure whatever comes out of this process is legislation that is good for the country and the industry.”
Key to the amendments would be the underlying regulations‚ which are a work in progress within the Department of Mineral Resources pending the enacting of the amendments. The chamber expected to be consulted closely on these‚ Baxter said
The oil and gas sector welcomed the president’s referral of the bill back to the National Assembly.
“ step in the right direction‚” South African Oil and Gas Alliance CEO Ebrahim Takolia said.
“Had the bill been signed in its current form it would have curtailed SA’s fledgling upstream oil and gas exploration potential.” — BDLive
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