The Aftermath of Zwane’s Mining Charter

Mineral Resources Minister MosebenziZwane’s shock Mining Charter, which surfaced earlier this year and proposes at least 30% black ownership of local mines,has caused some worry about the trials of an internal restructuring of such magnitude within the South African mining industry. With the Central Energy Fund(CEF) under immense strain to regain financial stability after facing various challenges regarding its solvency and Zwane declaring himself the “executive leader” of the African Exploration, Mining and Finance Corporation (AEMFC), uncertainty within the industry abounds.

 

The question on every stakeholder’s lip, then, remains: will this be disruptive or conducive to mining operations profitability, or will mine planning and mining optimisation strategies have to compensate for the internal turmoil? As this seems to be an incarnation of the 2010 Cabinet decision to eventually convert responsibility from the AEMFC to the department of mineral resources, Zwane’s transition does not appear to be unheard of or unanticipated; this does, however, do nothing for the CEF’s current financial disarray.

 

With some resentment between the AEMFC and the department of mineral resources, as well as an apparent breakdown of communication between the AEMFC and the CEF, uncertainty about its current leadership pervades the mining sector.

 

With Zwane’s past of unsanctioned governmental intervention in South Africa’s mining industry, management wonders whether his stepping in with empowerment legislation will actually be brought to bear, as the third iteration of his Mining Charter has been said to set impossible and unlawful targets.

 

With a track record of seemingly impetuous and legally grey political movements, Zwane’s influence in the local mining industry seems to be breeding an air of hostility against the mounting governmental presence it has been accommodating since 2010. With a hand in the Gupta family’s take-over of Glencore’s Optimum mine and a series of self-declared promotions over various bodies, like the AEMFC and, last year, a non-existent interministerial committee that allowed him to harass banks about the closure of Gupta family bank accounts, Zwane’s integrity has undoubtedly been called into question.

 

Whatever the disarray within the industry, one can always be sure to combat uncertainty within one’s own mining project with mine planning and turn around strategies that’ll keep it afloat, no matter the overarching issues the industry faces.

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