COVID-19: MINISTERIAL DIRECTIVE IN THE MINERAL RESOURCES AND ENERGY SECTOR

By Ross Mc Lean,Wandisile Mandlana,Claire Tucker Thursday, April 16, 2020
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On 11 April 2020, the Minister of Mineral Resources and Energy issued a directive in terms of regulation 10(8) of the Regulations published under section 27(2) of the Disaster Management Act, 2002 (Ministerial Directive).

The Ministerial Directive, which came into force on 11 April 2020, is intended to:

  • address, prevent, combat and manage the spread of COVID-19;
  • alleviate, contain and minimise the effects of the national state of disaster;
  • provide guidance on the implementation of the provisions for essential goods and services; and
  • ensure fair processes, especially regarding various mining- and petroleum-related licensing, consultation, appeals, compliance processes and reporting requirements during the lockdown period, which is currently set to endure until 30 April 2020. 

As with any process where mining legislation sets prescriptive time periods for certain actions to be taken, there now needs to be additional caution to ensure that the full implications of the Ministerial Directive, the lockdown period, and any possible extension thereto, are properly considered and understood to avoid inadvertent non-compliance with potentially serious consequences.

Application

The Ministerial Directive applies to:

  • all functionaries exercising powers or performing functions related to: (i) the processing of applications for, renewals of, and appeals related to, permissions, rights and permits as contemplated in the Mineral and Petroleum Resources Development Act, 2002 (MPRDA); (ii) compliance notices and directives issued in terms of sections 47 and 93 of the MPRDA; and (iii) the submission of all reports required under the MPRDA and the Broad-Based Socio-Economic Empowerment Charter for the Mining and Minerals Industry, 2018 (Mining Charter);
  • all applicants, appellants, holders of rights in terms of the MPRDA, as well as companies and interested and affected parties involved in the processes listed in the first bullet above; and
  • any other party involved in the processes listed in the first bullet above.

Directions relating to permissions, rights and permits as contemplated in the MPRDA

All timeframes prescribed in the MPRDA for, and applicable to, the following, have been extended by the number of days of the duration of the lockdown period:

  • applications for and processing of permissions, rights and permits, which period falls within the duration of the lockdown period;
  • applications for renewals of permissions, rights and permits, which fall either within the duration of the lockdown period or within a period of 60 days from 27 March 2020; and
  • internal appeals in terms of section 96 of the MPRDA read with regulation 74 of the Mineral and Petroleum Resources Development Regulations.

Importantly, this extension includes any previous extension of a timeframe granted by a functionary, which ‘new’ due date falls between 27 March 2020 and the date of termination of the lockdown period.

While these extensions are a welcomed intervention in difficult circumstances, they will cause delay in the decision making process. This because the decision-making process may only commence once the relevant application or appeal is submitted.

Potential delay in respect of appeals is even greater because responding statements equally enjoy the extended periods. As a result, it is advisable that a holder of a right should do all that is within its control to progress its application or appeal in order to minimise the impact of delay.

Compliance obligations or instructions to comply are not postponed

All timeframes stipulated in directives, notices, orders and/ or instructions issued in terms of the MPRDA and which period falls within the duration of the lockdown period are extended by the number of days of the duration of the lockdown period.

It should, however, be emphasised that the timeframes stipulated in directives, notices, orders and instructions that have been issued as urgent measures to prevent imminent damage or harm to persons, animals, the environment or property, must be complied with and this extension of the time period does not apply.

Simply put, only the compliance timetable is extended and not the actual obligation to comply.

Directions relating to submission of reports

Clause 6 of the Mining Charter requires that the first annual reporting on the Mining Charter be done on or before 31 March 2020. The Ministerial Directive has extended this date to 1 June 2020.

The timeframes for the submission of all other reports that must be submitted in terms of the MPRDA and which period falls within the duration of the lockdown period are extended by the number of days of the duration of the lockdown period.

These reports would include, for example, the: (i) progress reports and data of prospecting operations; (ii) prescribed annual report, detailing the extent of the holder’s compliance with the provisions of section 2(d) and (f) of the MPRDA, the Mining Charter and the social and labour plan; and (iii) relevant environmental reports required in terms of the MPRDA.