Legal bun fight at the northern end of the Eastern Limb
Updated: Jan 29, 2021
Samancor Chrome's long proposed Jagdlust Operations prove contentious
By Paul Miller
Samancor Chrome held a large swathe of old order chrome prospecting rights, in excess of 6000 hectares, at the northern end of the eastern limb of the Bushveld Complex, which they duly converted to new order rights in 2003. Not only did it own the mineral rights but it also owned significant freehold surface rights inthe same area.
Prospecting rights in South Africa are generally granted for a maximum of 5-years, renewable for a further 3-years. Samancor duly applied for a Mining Right for a long-life open pit and underground chrome mine eight years later in November 2011. The idea was that the 22-year life-of-mine operation would get into production by 2018.
The application was refused by the Director General of the DMRE on 11 March 2016, ostensibly due to the lack of proper notification and consultation with interested and affected parties. Samancor, however, only received the decision on 14 June 2016.
Based on this refusal of Samancor’s mining right, the properties theoretically become
open for application by new explorers. Accordingly, JSE-listed Bauba Resources (through a wholly-owned subsidiary) must somehow have got wind of the refusal of the earlier right and lodged an application for a prospecting right over the farm Zeekoegat 421KS before the end of that same month of June 2016. Zeekoegat is the farm on the western extent of the blue diagram above. Bauba’s application was accepted by the DMRE.
In fact the Supreme Court of Appeal found it interesting enough to make mention of the fact, in a later court judgement, that Bauba's subsidiaries had "... lodged multiple applications for prospecting rights for chrome on the properties. They first did so on 22 December 2014, which was even before the DG had refused Samancor's mining right application on 11 March 2016."
Samancor then appealed the Director General's refusal to the Minister. Bauba's subsidiaries responded to Samancor's appeal by also making submissions to the Minister, in which they criticised the consultation process Samancor had followed.
On 31 October 2016 the Minister overturned the DG's decision to refuse Samancor's application for a mining right . He appears to have accepted that Samancor had provided adequate proof of the consultation process. The Minister also granted Samancor a mining right. Samancor's enviromental management plans were approved by the regional manager in July 2017 and its mining right was then notarially executed.
In January 2017 the Bauba subsidiaries launched proceedings in the High Court to review the Ministers' decsion. The court then set aside the Minister's decision based solely on Samancor's 'failure to notify and consult with interested and affected parties'.
Samancor duly appealed to the Supreme Court of Appeal in Bloemfontein - which overturned the decison of the lower court on 27 August 2020. The decision can be read here.
Bauba has reported that its subsidiaries will appeal the matter to the Constitutional Court.
In the mean time any cursory look at a Google Earth image will show that illegal chrome miners have run riot across the properties in question, using heavy equipment to mine the LG and MG seams from one end of the mining right area to the other.