Minister of Mineral Resources and Others v Mawetse (SA) Mining Corporation (Pty) Ltd

Dilokong Chrome Mine (Pty) Ltd applied in November 2006 for a prospecting right under the Mineral and Petroleum Resources Development Act 28 of 2002 (MPRDA) over the farm Driekop. The Department of Mineral Resources (DMR), through the Deputy Director-General (DDG), approved the grant of the prospecting right in June 2007, subject to conditions, including compliance with section 2(d) of the MPRDA requiring Black Economic Empowerment (BEE) participation of at least 26%. Dilokong failed to meet this BEE condition due to a government moratorium preventing a state entity shareholder from disposing of shares. As a result, the prospecting right was never notarially executed, the environmental management plan was not approved, and the right never became effective. In 2009 Mawetse (SA) Mining Corporation applied for a prospecting right over the same land, but its application was rejected on the basis that Dilokong already held a prospecting right. After internal appeals and delays, Mawetse brought a review application. The High Court held that Dilokong did not hold a valid prospecting right as it had lapsed, and Mawetse’s application had to be reconsidered. Dilokong and the Minister appealed to the Supreme Court of Appeal.

The appeal was dismissed with costs, including the costs of two counsel. The High Court’s declaratory and remedial orders were upheld.

This case clarifies that BEE compliance in terms of section 2(d) of the MPRDA may lawfully be imposed as a condition for the grant of a prospecting right, not only a mining right. It confirms that prospecting rights cannot be sterilised indefinitely through non-execution or non-fulfilment of conditions, and provides authoritative guidance on when a prospecting right is granted, becomes effective, and expires. The judgment reinforces the transformative objectives of the MPRDA and the centrality of BEE in mineral regulation.