There were still serious problems with the Minerals and Petroleum Resources Development Act (MPRDA) Amendment Bill still before Parliament, Webber Wentzel mining head Peter Leon said last week.

The Bill was due to be sent back to the mining portfolio committee on February 18 and 19.

It was introduced to remove ambiguities and streamline administrative processes and is currently being finalised through Parliamentary processes.

“The reality is that there are still serious problems with the Bill once minerals are declared strategic and also the power the Minister will have to compel mining companies to sell those minerals at discounted prices to local producers. That’s a form of resource nationalism, no matter how they disguise it,” Leon told Mining Weekly in an interview on the sidelines of the Investing in African Mining Indaba.

Recent mineral export bans in Indonesia were hurting that country’s current account and weakening the Indonesian currency.

South Africa already had volatility, caused by other factors like the platinum strike, and could ill-afford any more.

Uncertainty on which minerals would be declared strategic, did not send a good message to investors who might be compelled to sell those minerals at discounted prices to local producers.

“That’s not a good picture,” Leon added.

Mineral Resources Minister Susan Shabangu said if her department worked with the mining industry, there would be no need to declare some of the minerals strategic.

“What might be strategic today may not be tomorrow,” Shabangu told journalists at a media conference.

The strategic minerals issue would be dealt with case by case and declarations would be made only in cases where it made economic sense.

“There has to be a process of engagement together with the industry and the producers of the minerals to be declared strategic,” the Minister added.

The MPRDA Amendment Bill is expected to be finalised during the tenure of the current legislators and, in the words of the Minister, seeks to optimise mining, minerals and upstream petroleum development and improve the ease of doing business in the mining industry.