X

This is not a paywall.

Register for free to continue reading.

We made a promise to you that we’ll never erect a paywall and we intend to keep that promise. We also want to continually improve your reading experience and you can help us do that by registering with us. It’s quick, easy and will cost you nothing.



Nearly there! Create a password to finish up registering with us:


Please enter your password or get a login link if you’ve forgotten


Open Sesame! Thanks for registering.

Ramaphosa's energy plan Webinar banner

We'd like our readers to start paying for Daily Maverick

More specifically, we'd like those who can afford to pay to start paying. What it comes down to is whether or not you value Daily Maverick. Think of us in terms of your daily cappuccino from your favourite coffee shop. It costs around R35. That’s R1,050 per month on frothy milk. Don’t get us wrong, we’re almost exclusively fuelled by coffee. BUT maybe R200 of that R1,050 could go to the journalism that’s fighting for the country?

We don’t dictate how much we’d like our readers to contribute. After all, how much you value our work is subjective (and frankly, every amount helps). At R200, you get it back in Uber Eats and ride vouchers every month, but that’s just a suggestion. A little less than a week’s worth of cappuccinos.

We can't survive on hope and our own determination. Our country is going to be considerably worse off if we don’t have a strong, sustainable news media. If you’re rejigging your budgets, and it comes to choosing between frothy milk and Daily Maverick, we hope you might reconsider that cappuccino.

We need your help. And we’re not ashamed to ask for it.

Our mission is to Defend Truth. Join Maverick Insider.

Support Daily Maverick→
Payment options

Junior (mining) Indaba: No transparency, no trust, no i...

Business Maverick

BUSINESS MAVERICK

Junior (mining) Indaba: No transparency, no trust, no investment

(Photo: Waldo Swiegersn / Bloomberg via Getty Images)

Paul Miller, the director of consultancy AmaranthCX, noted in a scathing presentation to the Junior Indaba that because of the lack of transparency on the awarding of mining and related rights, there was a ‘trust deficit’.

The tender to replace the dysfunctional Samrad system with a cadastre that will presumably shine the light of transparency on the awarding of mining rights in South Africa will be launched next week, the Junior (mining) Indaba heard on Tuesday. And not a moment too soon, as the lack of transparency and trust is a major deterrent to investment. 

Thabo Mokoena, the director-general of the Department of Mineral Resources and Energy (DMRE), made the announcement during the virtual Junior Indaba. The DMRE has come under withering criticism for the backlog of applications for mining and prospecting rights, which it admitted a couple of months ago had reached 5,326.

DMRE Minister Gwede Mantashe recently admitted that the Samrad system that is supposed to log such applications is a “nightmare”, giving rise to calls for it to be replaced with a proper mining cadastre. This is an online portal, open to the public, which provides comprehensive geological data about a country or mining jurisdiction, information on mining permits that have been issued, including expiry dates, and lists available mining or prospecting rights. We have written about this issue before.

Paul Miller, the outspoken director of consultancy AmaranthCX, noted in a scathing presentation to the indaba, organised by Resources 4 Africa, that because of the lack of transparency around the awarding of mining and related rights, there was a “trust deficit”.

He noted that the DMRE had claimed for a decade that the Samrad system was fine and then suddenly, out of the blue, it became a “nightmare”.

“After a decade of these denials, obfuscations, untruths and misstatements, the backlog of 5,326 applications (which will take a decade to clear at pre-Covid processing rates) has simply become too large to hide. Much like a flood bursting through a dam of lies, the truth is now out,” Miller said. “Secrecy is a cover for corruption and incompetence.”

He went on to ask, “Why would any investor trust the DMRE?” He noted that, “The application backlog was kept hidden from the public for almost a decade”, and that “courts have found the DMRE to be ‘institutionally incompetent’.”

“Potential investors, both local and foreign, continue to privately report being treated with disdain and contempt by both officials and politicians,” he said.

The results, unlike the DMRE’s Samrad system, are gin-clear. 

Miller noted that South Africa’s share of global capital expenditure in exploration has fallen from 5% over a decade ago to a paltry 1%. And without exploration, there will be no new mines. Since Samrad was introduced, gross fixed capital formation — otherwise known as investment — in the sector has fallen off a cliff. Meanwhile, South Africa’s ranking as a mining jurisdiction has plunged, across a host of industry surveys.

So this cadastre tender is one to watch, as well as any pushback against the transparency drive, which should lift the lid on much of the suspected corruption that has taken place at the DMRE’s provincial offices, notably Mpumalanga. Hopefully, the cadastre contract won’t go the crony Digital Vibes route. DM/BM

Gallery

Comments - share your knowledge and experience

Please note you must be a Maverick Insider to comment. Sign up here or sign in if you are already an Insider.

Everybody has an opinion but not everyone has the knowledge and the experience to contribute meaningfully to a discussion. That’s what we want from our members. Help us learn with your expertise and insights on articles that we publish. We encourage different, respectful viewpoints to further our understanding of the world. View our comments policy here.

All Comments 2

  • Thus for years the mining industry was on account of this lack of transparency, designated the industry of the politically connected. My company Archaus Mining which specialises in junior coal mining finance has been taken from pillar to post trying to access a comprehensive database of projects that need funding. Let’s hope this new system makes it much easier for deserving entrepreneurs in this space to get funded. Instead of being channeled to those who know somebody up there!

Please peer review 3 community comments before your comment can be posted