South African Minerals Development Bill
25 June, 2002
There has been considerable public speculation as to the possible impact of the proposed new Minerals and Petroleum Resources Bill.
Anglo American is examining the Bill tabled in the South African Parliament on Tuesday, 25 June and evaluating its implications. It is too early to reach definite conclusions, especially as the regulations accompanying the Bill, and the proposed Mining Charter have yet to be tabled. Anglo American looks forward to engaging constructively with Government and other stakeholders on these issues so that the new legislation can be implemented in a way that is both conducive to investor confidence and to fulfilling the aims of the Bill, of which the Company is fully supportive.
In so far as the Platinum sector has distinct features and has been the subject of particular commentary, Anglo Platinum has this afternoon put out a separate statement (attached).
Anglo American Platinum Corporation Limited
Registration No 1946/022452/06
JSE Code: AMS
ISIN: ZAE000013181
Media Release
There has been considerable press coverage of the passage of the new Mineral and Petroleum Resources Development Bill (the Bill) during the recent parliamentary debates. This coverage has given rise to much speculation as to what impact the Bill will have on the mining industry generally and in particular, its implications for the platinum industry and Anglo Platinum.
Anglo Platinum has been consistent in its support for the fundamental, political, economic and social objectives of the Bill. Two major multi-billion rand empowerment transactions have already been completed, with Mvelaphanda Holdings at Northam Platinum (22,5 per cent) and with African Rainbow Minerals at the new Modikwa (previously Maandagshoek) project (50 per cent), and two further major Black Economic Empowerment (BEE) initiatives are currently under negotiation. Most importantly, the company has committed to Government that it will propose significant additional BEE transactions and related small and medium enterprise (SME) initiatives at its new projects as these are developed.
In May of 2000, Anglo Platinum announced that based on its analysis of market demand, annual production capacity would be expanded from the then base of 2 million ounces of platinum to 3,5 million ounces by calendar 2006. Expressed in current money terms, escalated to completion, the capital cost of this expansion is estimated at over R20 billion. In pursuance of this programme, the Company has announced that new mines will be developed at Bafokeng Rasimone, Styldrift, Modikwa, Pandora, Waterval and Twickenham, the building of a new smelter at Polokwane (formerly Pietersburg) and the expansion of its base and precious metal refining activities in Rustenburg. Additional substantial capital projects to maintain baseline production are planned and will be announced if board approval and the requisite Government approvals are obtained.
These projects will provide over 13,000 new jobs directly as well as innumerable opportunities in surrounding communities for procurement and SME activities.
Pursuant to the R20 billion expansion programme, and in terms of a December 2000 agreement with Government securing the company's mineral resources within the eastern limb of the Bushveld Complex, and in compliance with existing legislation, the company made application to the Department of Mineral and Energy Affairs for mining authorisations covering existing operations, extensions thereto and in respect of undeveloped areas where the new mines are to be established.
Regrettably, despite frequent and ongoing efforts to progress these applications, inordinate delays have been experienced in their processing by the Department. In the event that the granting of these applications is delayed beyond the effective date on which the Bill becomes law, the Company's position regarding these mineral rights, including those to be developed for the expansion programme, may be adversely prejudiced by the implementation of certain of the provisions of the Bill. Accordingly, though the Company continues to engage the Department in an attempt to resolve these difficulties in a constructive manner, it had no choice but to institute legal action against the Department of Minerals and Energy to enforce the timeous processing of its applications.
In this respect, it was reassuring that at a meeting over the past weekend attended by senior Government Ministers, they confirmed that Government had no wish to see mining industry projects interrupted or delayed in any way that could result in the creation of uncertainty for investments in the mining industry.
Through the previously described transactions, implementation of major expansions and its social upliftment programmes, Anglo Platinum has demonstrated its commitment to Government objectives, including the 'use it or lose it' Mineral Rights policy and is making a substantial contribution to the development of the country's natural resources and economy for the benefit of all stakeholders. It fully intends to continue playing this role and looks forward to working with Government in the development, together with the rest of the industry, of the Mining Charter and in the implementation of the new Bill in a way that builds investor confidence and achieves the Bill's objectives.
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