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South Africa DMR suffers defeat in Aquila Steel court battle

Steel News - Published on Wed, 11 Jan 2017

Image Source: Mining MX
Mining MX reported that South Africa’s Department of Mineral Resources has suffered a devastating defeat in the High Court (Pretoria) which has potentially far reaching implications for other court battles over prospecting and mining rights.

The court’s judgement involves Aquila Steel South Africa, a subsidiary of China’s Baosteel, which was contesting a decision by the DMR in 2015 to set aside its mining and prospecting rights in the Northern Cape province.

What’s crucial about the High Court judgement, delivered by Judge NB Tuchten on November 21, is that the court has stepped in to make its own award of prospecting and mining rights.

Astonishingly, the judgement also implicates the DMR in an attempt to force Aquila to pay rent or to cut a deal in order to secure the prospecting and mining rights it was seeking to enforce.

Furthermore, Judge Tuchten found the DMR to have committed “a high degree of institutional incompetence” and “a lack of energy” which arose from that incompetence. He stopped short of describing the DMR guilty of “institutional bias”.

Finally, the judgement potentially opens up hundreds of hectares of exploration ground which the DMR had argued belonged to PAMDC or Pan African Mineral Development Company, an entity that was incorporated in 2007.

In September 2015, Aquila elected to call for a judicial review after its appeal against a ministerial decision to set aside its mining and prospecting rights had failed. It had spent 20 months prior to September arguing the matter.

Then mines minister, Ngoako Ramatlhodi, set aside Aquila’s Avontuur prospecting right in the Northern Cape. He also decided not to award Aquila a mining right for Gravenhage, a manganese project on which the firm had spent about R150m. The issue preceded Ramatlhodi as former mines minister Susan Shabangu had taken a similar position.

In respect of Gravenhage, the minister upheld Shabangu’s decision to grant an overlapping mining right to a company called ZiZa which Aquila said at the time “… appears to be connected with PAMDC”.

ZiZa, which was owned by the governments of Zimbabwe and Zambia, was incorporated in 1893 under the name The Bechuanaland Railway Company after land grants were made to it by the government of the Cape Colony to Cecil John Rhodes.

The PAMDC was subsequently created by the governments of South Africa, Zambia and Zimbabwe so that ZiZa’s historical mineral rights could be transferred to it, perhaps illegally. (However, Judge Tuchten found that ZiZa’s mineral rights were old order and it had not acted to convert them to new order rights.)

Source :

Posted By : Rabi Wangkhem on Wed, 11 Jan 2017
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