mineral and petroleum resource permits

The Mineral and Petroleum Resources and Development Act of 2002 (“MPRDA”) came into effect on 1 May 2004. In S3, it appoints the State through the Minister of Mineral Resources and Energy of South Africa as the custodian of South Africa’s mineral resources and energy. As with most, if not all, State regulations, there are various protocols which need to be followed for the granting, issuing, refusing, controlling, administration and management of these resources.

TECHNICAL COOPERATION PERMITS

 One relevant consideration is applying for a Technical Cooperation Permit, or “TCP”. Technical Cooperation Permits are regulated by the MPRDA and is one of the three granting instruments which can be given by the Petroleum Agency SA who is the designated agency appointed by the Minister in terms of Section 76. Applicants will need to apply to the designated agency for its approval of the Technical Cooperation Permit.

REQUIREMENTS FOR TECHNICAL COOPERATION PERMITS

 The application for a Technical Cooperation Permit has set requirements and are detailed in the MPRDA’s S76: any person who wishes to apply to the Minister for a Technical Cooperation Permit:

  • Must lodge the application at the office of the designated agency (Petroleum Agency SA situated in Oakdale, Cape Town);
  • It must be lodged in the prescribed manner (forms which are available on the Agency’s website); and
  • Such application shall be done together with the prescribed non-refundable application fee (R 100 for onshore and R 500 for offshore).

It should be noted that in terms of S77, the Minister must issue a Technical Cooperation Permit subject to S77(4) and in terms of S71(1). The Minister must refuse the permit if the application does not meet S77(1)’s requirements which are:

  • That the applicant needs to have access to financial resources and has the technical ability to conduct the proposed technical cooperation study;
  • The estimated expenditure must be compatible with the intended technical cooperation study and duration of the technical cooperation programme; and
  • The applicant must not be in contravention of any relevant provision of the MPRDA.

S76(2) states that the designated agency must accept an application for a Technical Cooperation Permit if:

  • The requirements contemplated in S76(1) are met;
  • No other person holds a Technical Cooperation Permit, exploration right or production right for petroleum over any part of the area in question; and
  • No prior application for an exploration right, production right, or Technical Cooperation Permit has been accepted for the same mineral, land and area.

In terms of S76(3) it is peremptory for the designated agency to notify the applicant in writing within 14 days of the receipt of the application if the application does not meet the set requirements and provide reasons for its refusal. The reasons would allow the applicant to then amend its application to comply with the requirements and deal with the queries. Further, Technical Cooperation Permits are granted for a period not exceeding one year.

RIGHTS AND OBLIGATIONS

 The rights and obligations of a holder of the Technical Cooperation Permit are set out in S79 as follows:

  • The holder of a Technical Cooperation Permit has, subject to S79, the exclusive right to apply for and be granted an exploration right in respect of the area to which the Permit relates;
  • Secondly, the holder of a Technical Cooperation Permit must actively carry out the technical cooperation study in accordance with the technical cooperation work programme and comply with the terms and conditions of the Technical Cooperation Permit, the relevant provisions of this Act and any other law; and
  • Submit a Technical Cooperation Permit for recording in the Mineral and Petroleum Titles Registration Office which is a personal right.

MINING VS. OIL AND GAS

 The process of mining and extraction of the natural resources differs to the oil and gas industry and is far more developed in South Africa. Its processes can also be vastly complicated with various competing interests (as mentioned in the 2013 Johannesburg Indaba on Investing in Resources and Mining in Africa which highlighted the interests of host states, resource extractors and communities.

RECENT COVID REGULATIONS

Further complications surround the Minister’s Covid-19 directives which entail extensions or deemed extensions for time periods in the MPRDA which came into effect on 11 April 2020 and remain valid and in force which are aimed primarily at alleviating and preventing as far as possible the economic effects of the pandemic.

 

If you need any assistance or advice and guidance regarding the recent regulations extensions as prescribed in April 2020 or navigating your way through applications for Technical Cooperation Permits, please do not hesitate to contact us to assist you.

 

Faure Swanepoel
faure@bbplaw.attorney
Candidate Attorney

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