Thungela Operations (Pty) Ltd v Chief Director, Water Use License Management: Department of Water and Sanitation and Others

Thungela Operations (Pty) Ltd (formerly Anglo Operations) applied for a water use licence (WUL) in July 2018 under section 40 of the National Water Act 36 of 1998 for the Palmietkuilen Mining Operation near Springs, Gauteng. The project proposed opencast coal mining over approximately 1,250 hectares with a 53-year lifespan. The mining right area is located in a sensitive catchment (C21E in Upper Vaal), bordering wetlands, tributaries of the Blesbokspruit (a Ramsar site), and Aston Lake. The WUL application covered multiple water uses including taking water, impeding flow, discharging waste, altering watercourses, and disposing of underground water. The Department of Water and Sanitation (DWS) declined the application on 12 April 2022, citing insufficient geohydrological and geochemical information, inadequate mitigation measures for backfilling and acid mine drainage (AMD), failure to apply for GN704 exemptions properly, and public opposition. Thungela appealed to the Water Tribunal.

• Whether the appellant provided sufficient geohydrological information and data regarding impacts on groundwater, particularly from the opencast pit area
• Whether the geochemical assessment and proposed mitigation measures for backfilling and potential acid mine drainage were adequate
• Whether the appellant complied with Regulation GN704 requirements and properly applied for exemptions for mining near watercourses
• Whether proposed mitigation measures for impacts on wetlands and sensitive ecosystems were sufficient
• Whether the socio-economic benefits of the project outweighed environmental and water resource impacts
• Whether cumulative impacts on already degraded water resources in the area were adequately considered
• Whether post-closure water treatment measures and financial provisioning were adequate
• Whether the respondent afforded the appellant procedural fairness
• Whether climate change impacts were adequately considered

Appeal dismissed. The decision of the Chief Director, Water Use License Management to refuse the water use licence application was upheld.

A water use licence application for mining activities must be supported by sufficient and accurate geohydrological and geochemical data collected from the actual areas where mining will occur, not merely from peripheral areas, to enable reliable modeling of groundwater impacts and design of effective mitigation measures. Where specialist reports identify data gaps, assumptions, and limitations, the applicant must address these through further studies before a licence can be granted. Proposed mitigation measures must be adequate for long-term impacts, particularly post-closure water contamination, and must be supported by appropriate financial provisioning for the full duration of anticipated impacts. Applications for exemptions from pollution control regulations (such as GN704) must be substantively motivated, not merely mentioned. Where permanent loss of wetlands and sensitive ecosystems will occur, offset options must be explored as recommended by specialists. The precautionary principle applies where there is uncertainty about future impacts, particularly in already degraded catchments where further pollution would cause regression. Decision-makers exercising trustee duties over water resources under section 3 of the NWA must balance socio-economic benefits against environmental sustainability and intergenerational equity, considering cumulative impacts and climate change. Section 27(1) factors of the NWA must be holistically applied, and where significant irreversible impacts on water resources cannot be adequately mitigated, refusal of a water use licence is justified.

The Tribunal made several non-binding observations: (1) That dilution is not a solution to pollution, contrary to suggestions in some of the appellant's reports. (2) That sustainable agricultural activities that endure indefinitely may have greater long-term socio-economic value than finite mining operations. (3) That a 53-year coal mining lifespan appears misaligned with South Africa's climate change mitigation policy and trajectory toward a low-carbon economy. (4) That it would have been preferable for the appellant to call the original Digby Wells specialists who conducted the initial studies rather than relying on reviewers of those reports. (5) That the concept of 'sustainable use' requires extractive activities to be within the bounds of what can cost-effectively be mitigated during and post-extraction. (6) That procedural fairness does not require opportunities to engage with each internal functionary of a decision-making authority, but rather meaningful opportunity to make representations to the decision-maker. (7) That applicants should not seek to unduly influence decision-makers or constrain the exercise of their regulatory and expert discretion. (8) That decisions must consider the situation of people living in project areas decades into the future who should not be burdened with unmitigated historical pollution.

This case is significant in South African water and environmental law for several reasons: (1) It affirms the Water Tribunal's wide powers on appeal to conduct a rehearing de novo and step into the shoes of the original decision-maker while considering the original decision as a starting point. (2) It establishes high evidentiary standards for water use licence applications in mining contexts, particularly regarding geohydrological and geochemical data collection from actual mining areas rather than peripheries. (3) It emphasizes the importance of addressing cumulative environmental impacts in already degraded catchments, applying the precautionary principle where uncertainty exists. (4) It clarifies that applications for GN704 exemptions require substantive motivation and cannot be granted merely by asking. (5) It reinforces the duty to consider post-closure impacts and ensure adequate long-term financial provisioning for water treatment extending decades beyond mine closure. (6) It demonstrates the integration of constitutional environmental rights (section 24), water law (NWA), and environmental management principles (NEMA section 2) in decision-making. (7) It highlights the need to consider climate change impacts and policy alignment in long-term mining projects. (8) It affirms the trustee duty of water authorities to balance socio-economic benefits against environmental sustainability and intergenerational equity.