A recent judgment of the High Court may give mining companies some guidance on best practice during their necessary consultations with interested and affected parties.

The case concerned three administrative decisions. The first was the approval by the Regional Manager of an Environmental Management Program submitted in terms of section 22 of the Mineral and Petroleum Resources Development Act (MPRDA), the second was the granting of a mining right by the Director-General and the third was the dismissal of an internal appeal by the Minister of Mineral Resources and Energy in terms of section 96 of the MPRDA.

The Court found that all three decisions were invalid, but only set aside that of the Minister. More importantly, the Court remitted the appeal back to the Minister with specific directions to consider any information put before him in respect of the appeal and any information put forth by interested and affected parties (I&APs). Also, the Court directed that the mining company notify I&APs of their entitlement to participate in the appeal process by publicising this widely and that it ensures that the public participation process that was conducted pursuant to the Minister’s determination of the appeal complied with the requirements of the Public Participation Guidelines in terms of the National Environmental Act (EIA Regulations).

In terms of the legal obligations surrounding these processes, the MPRDA, in section 22(4)(b), states that where the Regional Manager accepts an application for a mining right, s/he must, within 14 days, notify the applicant to notify and consult with I&APs within 180 days from the date of notice. In terms of section 42 of the MPRDA Regulations, every mining right application must be accompanied by a Social and Labour Plan (SLP). The contents of the SLP, the human resources development programme and local economic development programme, by their very nature, need to be prepared following an intensive I&AP consultation process.

In terms of section 39 of the MPRDA, every applicant for a mining right must conduct an Environmental Impact Assessment (EIA) and thereafter submit an Environmental Management Programme (EMP) within 180 days of being directed to do so. In preparing the EMP, and as part of the EIA, a scoping report must be prepared in terms of section 48 of the MPRDA Regulations. Also, an EIA report must be compiled.

The scoping report must include details around anticipated social, cultural and environmental impacts; identify and describe reasonable land use or development alternatives to the proposed operation; and describe the process of engagement of identified I&APs, including their views and concerns. The EIA report must include details of the nature, extent, duration, probability and significance of the identified potential environmental, social and cultural impacts of the proposed mining operation; the identified land use and development alternatives and their potential environmental, social and cultural impacts; and details of the engagement process with I&APs that was followed during the course of the assessment. It should also indicate how the issues raised by I&APs have been addressed.

There are also guidelines to consider, the Department of Mineral Resources and Energy (DMRE) published the Guidelines for Consultation with Communities and I&APs which clarified what comprises I&AP's and the obligations of an applicant in respect of I&AP consultation. Although they are not particularly related to the mining industry, the EIA Regulations provide guidelines on the public participation process in respect of an EIA and the treatment of comments by I&APs. In short, the EIA regulations provide for the public participation process, a register of I&AP's and for the inclusion of comments by I&AP's in reports submitted to competent authorities.

Key takeaways

This recent case reminds us that mining companies have an obligation to consult with I&APs, which almost always includes local communities. Failure to do so can hamper an application for a mining right, which is the legal instrument that ultimately separates legal from illegal mining. 

When engaging and consulting with I&APs, mining companies must consider both the law and the various guidelines. Fortunately, the High Court has provided some certainty in respect of what legal instruments to consider and the level of engagement required.

Written by Merlita Kennedy, Partner & Jared Ishmael, Associate at Webber Wentzel