South Africa's cabinet approves new mining charter
* Charter sets out requirements for black ownership levels
* Document could still be contested if mining firms unhappy
* Mineral and Petroleum bill withdrawn to spur investment
* Moves could help to kick-start investment -analysts
(Adds industry, analyst, details)
By Wendell Roelf
CAPE TOWN, Sept 20 (Reuters) - South Africa's cabinet
approved a long-delayed mining charter that sets out
requirements for black ownership levels and backed the
withdrawal of a mining bill after industry opposition, a
minister said on Thursday.
The mining charter - which was introduced to redress the
exclusion of black people in the mining sector under apartheid -
could, however, still be the subject of legal challenges if
mining companies are unhappy with its contents after it is
Communications Minister Nomvula Mokonyane said more details
about the charter would be announced on Friday by President
Cyril Ramaphosa when he unveils a new economic stimulus package,
to kick-start economic growth.
Policy uncertainty has stifled investment in the mining
industry of Africa's most industrialised economy, which has also
faced a wave of job cuts during a downturn in commodity markets,
high wage costs and a volatile labour environment.
"The mining charter was deliberated upon and indeed cabinet
has approved the mining charter," Mokonyane told reporters in a
briefing on Thursday, following a cabinet meeting on Wednesday.
Mokonyane also said the cabinet backed the withdrawal of the
Mineral and Petroleum Resources Development Amendment (MPRDA)
bill, which would have given the state a 20 percent minority
stake in new gas and oil exploration and production ventures,
which the industry had said would discourage investment.
Analysts say addressing policy certainty in the mining
sector could lead to billions of dollars of new investment.
"On both scores it will be beneficial to the investment
climate, because until now there has been hesitation to invest
in the sector because of the regulatory uncertainty," said Lloyd
Christie, a mining lawyer at ENS Africa.
The Minerals Council, which represents South African mining
companies, says policy and regulatory certainty could
potentially add 122 billion rand ($8 billion) in capital
expenditure to the struggling mining sector over the next four
"We will be able to comment when we see the final document,"
a spokeswoman for the Minerals Council said.
Amendments to the MPRDA bill were passed by parliament four
years ago but the draft law was sent back to lawmakers by former
president Jacob Zuma in 2015 due to concerns over whether they
The bill would have allowed the mines minister to require
that a portion of extracted resources be processed domestically
and not be exported in raw form.
Sean Lunn, chairman of the Offshore Petroleum Association of
SA (OPASA), told Reuters the group would support a separate Act
governing the upstream petroleum industry "that will encourage
and unlock investment."
OPASA members include ExxonMobil Total,
Shell Anadarko, ENI and Statoil.
($1 = 14.4826 rand)
(Editing by James Macharia and Susan Fenton)
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