Host communities and competing applications for prospecting rights in terms of the Mineral and Petroleum Resources Development Act 28 of 2002

Abstract

The various provisions of the Mineral and Petroleum Resources Development Act 28 of 2002 (“the Act”) concerning prospecting rights and preferential rights to prospect are discussed in this article. An ordinary prospecting right is granted by the Minister upon application to the applicant if the requirements of section 17 of the Act are met. In addition, section 104(1) of the Act also provides for the granting of a “preferent right to prospect or mine” to a traditional community (as defined in the Act) to prospect on community land. These provisions formed the basis of an unreported decision of the Transvall Provincial Division of the High Court in Bengwenyama Minerals (Pty) Ltd v Genorah Resources (Pty) Ltd (39808/2007 (TPD) (18-11-2008). The judgment dealt with the determination of legal preference where competing applications for prospecting rights were submitted in respect of the Bengwenyama traditional community land. An attempt was made in this case to colour the one application ex post facto as an application for a preferential prospecting right by the traditional community. It is argued that the court's decision concerning the difference and relationship between the two kinds of prospecting rights and the application of the “first come, first served principle” in terms of section 9(1)(b) of the Act was appropriate. It is further submitted that the facts of the Bengwenyama Minerals judgment highlights the shortcoming of the current section 104 of the Actin protecting the interests of a traditional community where someone else applies for prospecting rights on communal land.  The proposed 2008 amendments of the Act do not go far enough to ensure participation in prospecting and exploitation of minerals by a traditional community. The conclusion is that the current legislation is in need of an urgent overhaul in order to protect the interests of traditional communities.