Briefing by Director General on Legislative Programme Consideration of Regulations Passed Under Section 5 of the Abolition tf Le

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minerals & energy Portfolio Committee
26 September 2001
BRIEFING BY DIRECTOR GENERAL ON LEGISLATIVE PROGRAMME
CONSIDERATION OF REGULATIONS PASSED UNDER SECTION 5 OF THE ABOLITION OF LEBOWA MINERAL TRUST ACT, 2000

Chairperson: Mr D. Nkosi

Documents handed out:
Legislative Programme - Presentation to the Portfolio Committee on Minerals and Energy (Department of Minerals and Energy)
Energy Branch Legislative Development Plan (Department of Minerals and Energy)
Abolition of Lebowa Mineral Trust Act, 2000 - Summary of Regulations (Department of Minerals and Energy) (Annexure 1)

SUMMARY
The Director General of the Department of Minerals and Energy, briefed the Portfolio Committee on the Department's legislative programme for the next twelve months in relation to the mineral development and energy sectors. He summarised the schedule that the Department had set itself for processing the legislation. The purpose of the briefing was to enable the Portfolio Committee to align its programme with that of the Department. The Director General briefed the Portfolio Committee on the regulations promulgated under Section 5 of the Abolition of Lebowa Mineral Trust Act, 2000. The Portfolio Committee accepted the briefing, together with their discussions, as constituting due consultation on the regulations.

MINUTES
The Chairperson stated that the meeting had been convened to deal with two issues. Firstly, the Department of Minerals and Energy had been invited to brief the Committee on its proposed legislative programme in order to enable the Committee to bring its programme in line with that of the Department. Secondly, the purpose of the meeting was to inform the Committee of the regulations promulgated in terms of the Abolition of Lebowa Mineral Trust Act, 2000.

BRIEFING BY DIRECTOR GENERAL ON LEGISLATIVE PROGRAMME
Mr S. Nogxina, Director General at the Department of Minerals and Energy, stated that his presentation regarding the legislative programme would be divided into two sections, namely that legislation dealing with mineral development and that dealing with energy issues. He indicated the Bills presently being processed by the Department were integral in translating the Government's mining and mineral policy into action. Mr Nogxina briefly discussed each Bill and the timeframes that the Department had set for processing it.

Mineral Development Legislation:
Minerals and Petroleum Resources Amendment Draft Bill
Mr Nogxina stated that the name of the Bill had been changed owing to the fact that it regulated the extraction of both solid and liquid minerals. He confirmed that the Bill had been submitted to Cabinet on 22 August 2001, prior to which the Department had redrafted the Bill incorporating input from the public, an international panel of experts, the State Law advisor and various other third parties. Cabinet finally approved the Bill on 19 September 2001, the delay due to the involvement of many members of Cabinet in the World Racism Conference that coincided with their consideration of the Bill.

On 26 September, the Bill was referred to the State Law Advisor for certification. Mr Nogxina believed that there would be no delay in this process as the State Law Advisor's office was already familiar with the Bill. The Department was scheduled to publish and an explanatory summary of the Bill in the Government Gazette on 19 October 2001 and introduce the Bill to Parliament by 26 October 2001. He stated that the Department had hoped to introduce the Bill in September 2001 but there had been delays caused by factors outside of their control.

Precious Metals and Diamond Draft Bill
Mr Nogxina stated that the purpose of the Bill was to regulate the trade in and possession of precious metals and diamonds; discourage trade in conflict; and promote beneficiation of these materials. The contents of the Bill had originally been included as a Chapter in the Minerals and Petroleum Resources Amendment Draft Bill, but on the advice of the State Law Advisor, it had been drafted as a separate Bill. The Department hoped to submit the Bill to Cabinet for approval by 24 October 2001, release it for public comment by 2 November 2001, refer it to the State Law Advisor's office for certification office by 1 April 2002 and introduce it to Parliament by June 2002.

Mining Titles Registration Act
Mr Nogxina stated that extensive amendments would need to be made to the existing Mining Titles Registration Act of 1967 in order to bring it in line with the provisions of the Minerals and Petroleum Resources Development Bill. The Department had yet to decide whether the amendments would be contained in an amendment Bill or whether a new Bill would be drafted to repeal the existing Act. He stated that this depended on the scope of the amendments that needed to be done. The central tenet of the amendments would be to ensure security of tenure and the ability to register mineral rights. He further stated that the Act, and the amendments to it, would be one of the cornerstones for the successful implementation of the Minerals and Petroleum Resources Development Bill.

According to Mr Nogxina, the Department was scheduled to have completed the drafting process by the end of the year, to have sought Cabinet's approval to release the amendments for public comment by February 2001, to have obtained Cabinet's approval to introduce the amendments by June 2002, to refer the amendments to the State Law Advisor for certification by July 2002 and to have introduced the amendments into Parliament by August next year.

The Committee Members were then invited to address questions to Mr Nogxina regarding the Mineral Development legislation.

Ms D. Motubatse (ANC) requested clarification as to what the objects of the Minerals and Petroleum Resources Development Bill were.

Mr G. Oliphant (ANC) asked which stakeholders had been consulted during the drafting process of the Minerals and Petroleum Resources Development Bill. He stated that it was important for the Committee to know this in light of the recent public outcry in this regard. He further queried why there was a need for separate legislation for diamonds, precious metals and mining titles.

Mr Nogxina stated that it had always been the Department's intention to deal with mining titles in a separate Act. He further stated that petroleum products had always been included in the Minerals and Petroleum Resources Development Bill and that the change in the title of the Bill in no way reflected a change in its content. With regard to stakeholders, he stated that both informal and formal consultation had taken place. Formal consultation had taken place through NEDLAC and informal consultation had taken place with the Chamber of Mines. He confirmed that the rationale for amending the Mining Titles Registration Act was to bring it in line with the provisions contained in the Minerals and Petroleum Resources Development Bill.

Mr J. Rocha, Director of Mineral Rights at the Department of Minerals and Energy, elaborated on Mr Nogxina's response. He acknowledged that there would be a gap between the finalisation of the Minerals and Petroleum Resources Development Bill and the amendments to the Mining Titles Registration Act. He stated however that this was unavoidable owing to the fact that there would be substantial cross-referencing between the two pieces of legislation. It was therefore essential that the one be completed prior to the other. Mr Rocha drew a distinction between those Bills dealing with the upstream process, namely the extraction of minerals, and those dealing with the downstream process, namely the processing of the raw minerals. He stated that the Minerals and Petroleum Resources Development Bill dealt with the upstream process in relation to minerals and petroleum whilst Bills such as the Precious Metals and Diamond Bill would deal with the downstream process. With regard to the change in name of the Minerals and Petroleum Resources Development Bill, he stated that it was essential to include "petroleum", so that foreign investors would be adequately informed and not misguided. He confirmed that the response from the foreign panel of experts had been positive.

Mr Nogxina confirmed that the Department would release the comments of the panel of experts to the Committee.

Adv. M, Mononela, Regional Director (Northern Province) of the Department of Minerals and Energy, stated that the purpose of the amendments to the Mining Titles Registration Act were to create security of tenure and enable bodies to register prospecting and mining right titles. He stated that this would enable them to secure funding and finance for their operations.

Mr S. Mongwakeste (ANC) raised a concern that certain stakeholders had already had an opportunity to comment on the Minerals and Petroleum Resources Development Bill and that, if they were given another opportunity to be involved in the public hearings on the Bill, they would effectively have been given "two bites at the cherry" whereas other had only had one.

Mr I. Davidson (DP) stated that petroleum was a mineral and asked why there was therefore a need to amend the title of the Minerals and Petroleum Resources Development Bill. He stated that if one included petroleum in the title, one should similarly include diamonds and precious metals in the title.

Mr Nogxina responded stating that the "upstream process" relating to diamonds and precious metals was included in the Minerals and Petroleum Resources Development Bill whilst the downstream process relating to these minerals was regulated by the Precious Metals and Diamonds Bill. He did not believe that there was any reason to include diamonds and precious metals in the heading.

Energy Legislation
Gas Bill
Mr Nogxina stated that the National Assembly would debate this Bill on 27 September 2001.

ESI Regulatory Bill
Mr Nogxina confirmed that this Bill would be submitted to Cabinet for approval on
10 October 2001, published for comment by 10 November 2001, closed for public comment by 10 December 2001, referred to the State Law Advisor's office for certification by 10 March 2002, and finally submitted to Cabinet for approval by June 2002.

RED's Establishment Bill
Mr Nogxina confirmed that the following timeframes had been scheduled by the Department for processing the Bill: publish the Bill for comment by December 2001; close the commenting procedure by the end of January 2002; redraft the Bill by March 2002; refer the Bill to the State Law Advisor's office for certification by April 2002; and finally submit the Bill to Cabinet for approval by May 2002.

Petroleum Pipelines Bill
Mr Noxgina confirmed that the Bill dealt with the downstream process in relation to petroleum and that it had been released for public comment on 15 September 2001. He confirmed that the following timeframes had been scheduled by the Department for processing the Bill: close the commenting procedure by 15 October 2001; redraft the Bill by 15 November 2001; refer the Bill to the State Law Advisor's office for certification by 15 December 2001; and finally submit the Bill to Cabinet for approval by the beginning of 2002.

Petroleum Products Amendment Bill
Mr Noxgina confirmed that this Bill dealt with the downstream process in relation to petroleum, that it had been released for public comment and that the closing date for submissions was 30 September 2001. He confirmed that the following timeframes had been scheduled by the Department for processing the Bill: redraft the Bill by 30 October 2001; refer the Bill to the State Law Advisor's office for certification by 30 November 2001; and finally submit the Bill to Cabinet for approval by 15 December 2001.

Energy Bill
Mr Nogxina stated that this Bill was still in the framework stage and that the Department was hoping to have finalised the Bill by the end of 2002.

The Committee Members were then given an opportunity to address questions to Mr Nogxina regarding the legislative programme for the energy legislation.

Mr Oliphant sought clarification on the State Law Advisor certification process and its effectiveness. He asked whether the process had become better or if it had got worse.

Mr Nogxina stated that the process was improving due to the fact that the Department had changed its approach. The Department had decided to involve the State Law Advisor's office in the drafting process so that once the Bills were sent to them for certification, this latter process was easier and quicker.

The Chairperson suggested that in order to facilitate the Committee's consideration of future Bills, that once the Bills were sent to the State Law Advisor's office, they simultaneously be forwarded to the Committee. This would enable the Committee Members to prepare themselves for the deliberations. He further suggested that public hearings on the Minerals and Petroleum Resources Development Bill be held in the provinces so that communities and organisations which had not had an opportunity to comment on the Bill, or that lacked capacity, would be given a fair opportunity to do so. He proposed that the Department brief the Committee on the Bill on 26 October 2001.

CONSIDERATION OF REGULATIONS PASSED UNDER SECTION 5 OF THE ABOLITION OF LEBOWA MINERAL TRUST ACT, 2000
Mr Nogcina presented the Regulations to the Committee (the Regulations are set out in Annexure 1). He stated that the Minister had signed the Regulations on 20 September 2001 and that he sought the Committee's comments on them. The Regulations had been enacted in terms of Section 5 of the Lebowa Mineral Trust Act, 2000, and set out the procedure for certain persons to lodge claims for minerals rights.

Mr Mongwaketse asked what had happened in relation to the contentious issues of the staff and the funds of the Lebowa Mineral Trust.

Adv Mononela responded by stating that the staffing issue had been resolved and many of them had been integrated into the Pretoria Office. The target date for full integration of all staff had been set as 1 January 2001. He further stated that discussions were presently being undertaken with various parties regarding what to do with the Trust's assets.

Mr J. Nash (ANC) stated that many promises had been made to the people of Lebowa prior to the Act coming into effect. These promises included development and progressive programmes that would be implemented in the area for their benefit. He asked whether these programmes had been implemented.

Mr Oliphant asked whether the legal challenge to the Act had been resolved.

Adv. Mononela responded stating that the Pretoria High Court had reserved judgement and they were therefore awaiting the court's decision.

Mr Davidson asked what would happen to those people who had customary rights to land and minerals. He stated that they did not appear to qualify under the Regulations to lodge claims for mineral rights.

Adv. Mononela responded by stating that prior legislation had not conferred any customary mineral rights. The original mineral rights had been conferred by proclamation and the Act had simply withdrawn this conferment. These rights had accordingly not been included in the Regulations.

Mr Rocha elaborated on the issue stating that customary mineral rights could in any event fall under clause 2(e) of the Regulations.

Ms Motubatse again raised the concern that in the Committee's prior discussions on the Act, important focus had been placed on how the Lebowa people would benefit from the abolition of the trust. She stated that the Committee had heard nothing further in this regard.

Mr E. Lucas (IFP) agreed with the statement of Ms Motubatse and said that the Committee needed to be kept informed especially on issues such as the apparent misuse of the Trust's funds.

Mr Oliphant similarly sought clarification of what happened to the Trust' s funds.

Mr Nogxina responded by stating that he was not in a position to comment on these issues. He stated that he was merely present to brief the Committee on the contents of the Regulations. He undertook to investigate the matter and report to the Committee again at a later stage. He however indicated that it appeared that there had been an abuse of the Trust's assets to be used for the development of the Northern Province.

The Chairperson concluded the debate by stating that the Department would brief the Committee on the issue at a later stage. He furthermore stated that for the purposes of consultation on the Regulations, he believed that their discussions sufficed. The Committee was in agreement and the meeting was closed.

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Appendix 1

ABOLITION OF LEBOWA MINERAL TRUST ACT, 2000
(ACT NO. 67 OF 2000)
The Minister of Minerals and Energy has, under section 5 of the Abolition of the Lebowa Mineral Trust Act, 2000 (Act No. 67 of 2000) made the regulations set out in the Schedule.

SCHEDULE
1. In these regulations, unless the context indicates otherwise, "the Act" means the Abolition of the Lebowa Mineral Trust Act, 2000 (Act No. 67 of 2000), and any expression to which a meaning has been assigned in terms of the Act, bears the meaning so assigned.

Application to claim mineral rights

2. Any person who lodges a claim for mineral rights in terms of section 3(1)(c) of the Act must -

(a) state in writing the history of his or her occupation or acquisition of the land or mineral rights concerned;
(b) state in writing the nature of the land tenure;
(c) submit the title deed, if any, of the land concerned;
(d) submit any document other than title deed, which constitutes proof that the Trust held mineral rights in trust for the applicant; or
(e) indicate the extent to which the applicant mined, exploited or made use of the said minerals, either in terms of law or custom.

Vesting and transfer of assets, liabilities, rights and obligations of Trust
3. For the purpose of section 3(1)(a) and (b) of the Act, the Minister may appoint a person or persons, after the abolition of the Trust, on terms and condition determined by the Minister, to administer and wind up the affairs of the Trust.