DMRE PRESENTATION ON DERELICT

AND OWNERLESS ASBESTOS MINE

1

28 SEPTEMBER 2019

1. Introduction

2. Derelict and Ownerless (D&O) Mine Sites

‒ Distribution of the D&O Mine Sites

‒ Legislative Gaps

‒ Democratic Government Innervation

‒ Valuation of Liability

‒ High Priority Mine Sites

‒ Asbestos Mines Rehabilitation Progress

‒ Key Project Implementation Plan 2019

3. Conclusion

2

PRESENTATION OUTLINE

INTRODUCTION

3

South Africa has a long history of formalised mining in excess of a

century.

The Mines and Works act of 1956 introduced a requirement to install

fencing around a mining area upon closure of a mine

The conspicuous absence of mine environmental legislation and

recognition of incremental State liability resulted in the initial mutual

agreement being concluded between the Minister of Water Affairs and

the Chamber of Mines that rehabilitation liability for all abandoned mines

prior to 13 July 1976 will be transferred to the state.

Subsequently, in 1980 regulation for mine rehabilitation requirements

were Gazetted, although they did not clearly define minimum

allowable or essential elements for rehabilitation to be considered

INTRODUCTION

4

Sustainable Development became most prominent issue during Mining &Environment summit (Rio De Janeiro, 1991)

Mine Rehabilitation Enforcement became an integral part under MineRehabilitation Minerals Act 50 of 1991. The act empowered the RegionalDirector to approve Environmental Management Plans and to issue closurecertificate to release mining companies from the rehabilitation liability, albeitwithout consultation with other Government regulators.

The Minerals and Petroleum Resources Development Act (MPRDA) of2002 effectively introduced a sustainable approach to the development ofmineral and petroleum resources in South Africa, in line with the SupremeLaw of the nation, the Constitution. In particular, the MPRDA sought toeffectively address all mining environmental issues, with one of its keyobjectives being give effect to the environmental right, as contained insection 24 of the Constitution.

INTRODUCTION

5

According to the Constitution of the Republic of South Africa

(Act 108 of 1996) section 24, “everyone has the right to an

environment that is not harmful to their health or well-being”.

It also states that “everyone has the right to have the

environment protected, through reasonable and other

legislative measures that prevent pollution and ecological

degradation, promote conservation and secure ecologically

sustainable development and use of natural resources while

promoting justifiable economic and social development”.

6

DERELICT AND OWNERLESS MINE SITES

DISTRIBUTION

LEGISLATIVE GAPS

7

Conspicuous absence of mine environmental legislation as well as proper coordination of all relevant pieces of legislations made it impossible to implement polluter pays principle for many years.

Hence, a liability of approximately 6000 Derelict and Ownerless (D&O) mine sites is inherited by the state.

Asbestos mines makeup 254 mines.

It became crucial for Government to create an integrated mine environmental management system to effectively implement polluter pays principle

During the 2002 – 2011 process of amending the MPRDA, NEMA and NWA an agreement was reached between the Ministers of DEA, DMR, and DWS which intended to:

Adopt an integrated mine environmental management system.

Alignment of the MPRDA with NEMA to effect “One Environmental System”

DEMOCRATIC GOVERNMENT INTERV

8

The democratic government of South Africa legally embargoed the

mining of asbestos in 1999 due to its extreme health hazard.

Early 2000, the Department of Mineral Resources (DMR) initiated a

research programme on derelict and ownerless mines in order to:

Establish a baseline understanding of the scope of the problem ofderelict and ownerless mines

Pilot the programme of implementation, largely informed by risk ofasbestos

Secure annual allocation of funds for a programme of rehabilitatingderelict and ownerless mines under the Mineral Regulation Branch.This function was subsequently transferred to Mineral Policy andPromotion in 2009

Direct development of a database for D&O, estimated at 6000 at thetime

Guide the initiation of a Government Task Team (DMR, DST, DWEA)

Estimate the extent of the liability (Est. to be R30 Billion at the time)

9

VALUATION OF THE LIABILITY

The fair value of the liability in relation to rehabilitation of

former Asbestos mining sites is estimated at R2 billionas at 31 March 2019..

The estimated the present value of the closure costs of all the other derelict and ownerless mines at R48.7 billion as at 31 March 2019. This estimation is supported by the evidence from operational mines as well as DMR guidelines on closure costs.

10

HIGH PRIORITY MINE SITES

3.2%

3%

6.3%

47.7%

16.7%

22.4%

0.7%

High Priority

Moderate Priority

Low Priority

No Rehab Appears

Necessary

Operational Or Owned

Visited But No Access

Rehabilitated

11

ASBESTOS MINES REHABILITATION PROGRESS

PROVINCE MINE NAME DESCRIPTION

Northern Cape Buisvlei North Asbestos Mine Mine Dumps

Masaneng Asbestos Mine Shafts/Adits

Buisvlei South Asbestos Mine Mine Dumps

Strelley Mine Dumps

Langley Mine Mine Dumps

Prieska Old Hospital Shafts/Adits

Heuningvlei Mine Dumps

Vergenoegd Mine Dumps

Ga-lotolo Mine Dumps

Prieska Parkland Creation Mine Dumps

Buisvlei North Asbestos Mine Mine Dumps

Buisvlei South Asbestos Mine Mine Dumps And Shafts

Masaneng Asbestos Mine Mine Dumps And Shafts

12

ASBESTOS MINES REHABILITATION PROGRESS

PROVINCE MINE NAME DESCRIPTION

Limpopo Motsane Asbestos mine Mine dumps and shafts

Mafefe

Penge

Mine dumps and shafts

Ditabogong Mine dumps and shafts

Mahlatjane Mine dumps and shafts

Ga-madiba Mine dumps and shafts

Betle Mine dumps and shafts

Mang le mang Mine dumps and shafts

KwaZulu Natal Klip river Mine dumps and shafts

Sithilo Mine dumps and shafts

2016/17 COMPLETED ASBESTOS REHABILITATION PROJECTS

• Buisvlei South in Northern Cape Province

13

2016/17 COMPLETED ASBESTOS REHABILITATION PROJECTS cont…

• Betle Project in Limpopo Province

14

2016/17 COMPLETED ASBESTOS REHABILITATION PROJECTS cont…

• Motsane Project in Limpopo Province

15

Key Project Implementation Plan 2019

16

Project Name Status Province

Streatham Due to complete in August

2019

Limpopo

Msauli Due to complete July 2019 Mpumalanga

Uitkyk Due to complete December

2019

Limpopo

Lagerdraai Appointment of a Contractor Limpopo

Penge Appointment of a Contractor Limpopo

Leather Tender phase Limpopo

Wonderkop Limpopo

Dublin Limpopo

Uitval Limpopo

CONCLUTION

17

The Department will continue to:

finalize the verification process of D&O mine sites.

Update the State Contingent Liability to reflect current

developments.

Rehabilitate Asbestos Mine Sites

18