Sibanye-Stillwater has dragged the department of mineral resources & energy to court in a bid to force the department to grant it a mining right for the promising exploration project President Cyril Ramaphosa once had a stake in.
The imminent legal showdown between the Neal Froneman-led Sibanye and Gwede Mantashe’s department was revealed by the mining house in its annual report, published last week ahead of the AGM later this month.
The dispute is over the granting of a mining right licence over an exploration project called Akanani to an unnamed third party. This is after Sibanye’s application in 2021 for the prospecting right to be converted to a mining right was rejected by the department and the subsequent internal appeal also fell through, forcing Sibanye to seek judicial review.
The department’s contention is that Sibanye’s prospecting right had expired, giving it room to grant the mining right to other parties. Sibanye insists the department is wrong in how it is interpreting the expiry date of prospecting rights.
“Sibanye-Stillwater is contesting the award of a prospecting right to a third party over the Akanani project area and the matter will be heard by way of a review application in the high court in the next 12 to 18 months,” the company said.
“Sibanye-Stillwater’s expectation is that the court will rule in its favour and set aside the granting of the prospecting right to a third party, and award the mining right over the Akanani project area to Sibanye-Stillwater.”
Ramaphosa
Shanduka Resources, the mining arm of Ramaphosa’s erstwhile investment vehicle, Shanduka, in 2010 took over Lonmin’s empowerment initiative, Incwala Resources, in a cash and debt deal worth R2.8bn at the time. Incwala has a 26% stake in the Akanani project.
Sibanye bought Akanani as part of its multibillion-rand tie-up with Lonmin in 2019. The mining house, one of SA’s largest private sector employers, said extensive exploration drilling had been conducted on the southeastern portion of the property, confirming significant mineral resources, which offer the potential for a “long-life, low-cost operation”.
Studies on the project have shown that available reserves within the vicinity of the project area indicate that the mine will have a life of about 35 years, which can be extended beyond 60 years.
Akanani is located on the northern limb of the Bushveld Complex — the geological formation which hosts the platinum-bearing reefs — and sits adjacent to and down-dip of Anglo American Platinum’s Mogalakwena opencast mine.
A prospecting right entitles the holder to the exclusive right to prospect for prescribed minerals in a prescribed land area. The holder also has the exclusive right to apply for, and be granted, a mining right regarding the minerals and land to which the prospecting right relates, the Mineral & Petroleum Resources Development Act reads.
However, the minister is authorised to grant or refuse applications for rights under the act, provided an applicant meets all the requirements relating to the right for which the applicant has applied.
Before implementation of the act, Sibanye’s subsidiary Akanani Mining was the holder of an old-order prospecting permit. The old-order right was converted to a new-order prospecting right in 2006. In terms of the converted prospecting right, Akanani has the right to prospect for platinum group metals (PGM), gold, silver and cobalt.
The company in 2011 submitted an application for renewal of the prospecting right. This application for renewal was assessed by the department and approved in 2018, allowing Akanani Mining to commence with the mining right application.
In June 2019, Sibanye-Stillwater acquired the entire capital share of Lonmin in a deal that saw it capture assets like Marikana PGM mining operations and associated retreatment, smelter, base metal refinery and precious metal refinery assets in SA. The acquisition also included Akanani Mining.
Mantashe told Business Day he would not comment on matters before court.
The department has been struggling to process prospecting and mining licences. It emerged in January that of the 2,500 mining applications received in the 2023/24 financial year, not one was finalised.
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