go get them dumps good news on legislation

http://www.miningmx.com/mining_fin/815783.htm

SLV keeps on getting better and better in terms of long term prospects - boosted by this decision.




That, in turn, means they don't have to bring a black economic empowerment partner into the operations, as required by the MPRDA. They also don't have to jump through all the hoops that the Department of Minerals & Energy (DME) is forcing on the mining industry in terms of social and labour plans.

Operations affected by the decision include those run by companies such as De Beers, DRDGold (which recovers gold from tailings dumps), Simmer & Jack (Simmers, which is recovering gold and uranium from dumps near Stilfontein) and Sylvania Resources (which recovers platinum group metals from tailings dumps near Rustenburg).

Hulme Scholes, a lawyer who specialises in mining issues as a partner with Werksmans, says: "The significance of this judgment is huge. It means that as a general principle of law every dump in South Africa can be mined without having to apply for a mining right. If you can prove ownership of the dump then you can just start taking the material away for treatment to recover the minerals."

De Beers case

The case was brought by De Beers when the DME granted a prospecting right to Ataqua Mining over dumps at the diamond group's Jagersfontein mine in the Free State, where mining operations ceased in 1971. In their ruling on 13 December in the Bloemfontein High Court, judges A Kruger and AP Beckley set aside the granting of that right.

They also stated: "It is declared that the provisions of the Mineral and Petroleum Resources Development Act No 28 of 2002 do not apply to the tailings dumps situated on subdivision 16 of the farm Jagersfontein 14, magisterial district of Fauresmith."

Scholes says the key reasons for the judgment lie in the concept of tailings dumps being "movable" assets while recovery of minerals from them doesn't comprise mining for the purposes of the MPRDA. A crucial issue is that the minerals in tailings dumps have been "severed" from the ground by previous mining operations.

The judgment states: "The MPRDA targets mining rights in un-severed minerals in the ground, not in tailings which have been mined."

The judges also pointed out that, while the Minerals Act of 1991 - which was replaced by the MPRDA - recognised the mining of tailings dumps, the MPRDA did not. They stated: "The MPRDA did not want to regulate tailings dumps. There is no continuation of the regime under the Minerals Act in respect of tailings dumps."

The judges added: "In order for diamonds in the tailings dumps to be considered 'minerals' for purposes of the MPRDA (and therefore vesting under custodianship of the State) they must be found to be occurring naturally in the earth.

"The fact that they still occur naturally in the ore is irrelevant for purposes of the definition of 'mineral' in the MPRDA.

"The diamonds in the ore were severed from the mother rock. Then the ore became a new object. That vested ownership in the mineral titleholder, the applicant. That all happened before the MPRDA came into operation. The MPRDA did nothing to detract from applicant's rights to the tailings dumps. Tailings are a unique place in which minerals can be found after someone has taken them out of the earth and process them to some extent."


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Scholes says the inclusion of tailings in the MPRDA would have comprised an expropriation of movable property and exposed the State to claims for compensation. "Claiming a movable asset in that way for ownership by the State would have been like laying claim to somebody's car, which is movable property."


That's also addressed by the judges, who state: "A finding that the State is now the custodian of the minerals remaining in tailings dumps would amount to expropriation, which is not expressly provided for and cannot be inferred to have been contemplated by the legislature.

"Our law requires that a strict construction be placed on statutory provisions which interfere with elementary rights."

Scholes adds any attempt by the DME to amend the MPRDA in response to the judgment will expose the State to huge compensation claims. Neither DME director-general Sandile Nogxina nor deputy director-general Jacinto Rocha could be reached for comment.