Parliament’s time is short to change mining, oil lawComment on this story
Johannesburg - Parliament might run out of time to process changes to mining and oil legislation before adjourning ahead of May 7 elections and might have to refer the amendments to the next legislature to adopt, an ANC MP said yesterday.
Proposed changes to the Mineral and Petroleum Resources Development Act include giving the state a free 20 percent stake in all new energy ventures, and compelling certain mining firms to sell some output to local processors.
Companies including Anglo American and BHP Billiton have said the measures would hurt business, discourage investment and might violate the constitution and international trade obligations.
“Quite frankly if it means taking the law over to the next Parliament, let it be rather than just passing it without deeply looking into the issues,” Faith Bikani, the acting chairwoman of the portfolio committee on mineral resources, said after the committee adjourned deliberations on the law until next week.
The committee has to draft a report on the law before it is voted on in the National Assembly, which is set to adjourn on March 13.
The legislation must then be referred to the National Council of Provinces, which has to hold its own hearings before adopting the law.
The law proposes giving the mineral resources minister the right “to designate any mineral, mineral product or form of petroleum for local beneficiation”, and decide what percentage must be made available to processors after taking into account “national developmental imperatives”. It would also give the government the right to buy a 30 percent stake in new energy projects at market-related prices in addition to the 20 percent free carried interest.
“It looks like the law’s being kicked into touch, which is a good thing given how bad it is,” Peter Leon, the head of Africa mining and energy projects at Webber Wentzel, said after yesterday’s hearing. “While it will prolong uncertainty for the mining and oil industries, it will give them more time to consider its implications.”
Bikani said the ANC was researching whether provisions covering oil and gas could be split and incorporated into a new law more suited to the energy industry’s state of development.
Mineral Resources Minister Susan Shabangu has rejected that option, saying earlier this month that it would create regulatory uncertainty.
“The decision is not up to the minister, it’s up to the ANC to decide what direction we should take,” Bikani said. - Bloomberg