Lawyer Monthly Legal Awards 2023 which means that at least ten persons benefit from one position at a mine, and if employees are retrenched or contractor service provider agreements are terminated, the effect is far more significant than it appears. One of our key principles is to remain relevant to the South African mining industry and our clients. This means that we have to not only remain on top of legislative changes, but also the practical effect of these changes, including how they may impact our clients’ businesses. We spend a tremendous amount of time at our clients’ mines to ensure that we continue to understand the effect of both the legislative changes and the advice that we give. We are also fortunate to be involved in many industry initiatives, including around alternative energy sources, artificial intelligence and other technological advances, and changes to the skill sets that are required to ensure that mines of the future are sustainable. Through our practical engagement and the initiatives that we participate in, we are able to continue providing our clients with solutions – based advice. Environmental and sustainability issues are becoming more crucial in the natural resources field. How do you integrate these concerns into your legal counsel and corporate strategies? Environmental compliance has always been a significant element of the Mining and Natural Resources Sector, with the mining and environmental legislation requiring numerous environmental authorisations, both before mining operations commence and throughout the life cycle of the mine, including rehabilitation and closure. Many South African mines are extremely old, which means that environmental compliance becomes far more challenging. Of great concern is the fact that there are hundreds of mines in South Africa that are “ownerless” and have been abandoned for many years. The South African government, in most instances, carries the responsibility for the rehabilitation of these old and abandoned mines, and as resources become more constrained, the ability to properly rehabilitate these old mines is becoming almost impossible. The situation is made far worse, in relation to Warren, as an expert in mining law, could you share your insights on the biggest legal challenges currently facing the mining sector, and how Beech Veltman is positioned to address these challenges? 2023 has been another horrendous year for the mining industry. In South Africa the challenges have been so multifaceted and far-reaching that the South African mining industry has had to adopt crisis - style management, and this has become the normalised way of managing South African mines. At the same time, mining companies are trying to implement medium to longer-term initiatives and strategies aimed at securing sustainable mining operations. Not an easy balancing act. In addition to the typical challenges faced by the global mining industry such as cyclical and unpredictable demand, erratic exchange rates, and increased costs of handling and shipping, South Africa is facing a crisis in relation to its deteriorating infrastructure (ports, rail, roads, water and electricity) which has had a significant impact on the South African mining industry’s ability to mine and beneficiate its minerals cost-effectively, consistently , and on a sustainable basis. Congestion at South African ports is exacerbated by constrained and deteriorating road and rail infrastructure, and inefficient management of the shipping and transportation services through State-owned enterprises. South African mines cannot get their product to market on a consistent, sustainable basis. Even where the minerals are sold locally, South Africa’s road infrastructure has deteriorated so rapidly over the last twelve to eighteen months, that it has resulted in significantly increased costs of transportation attributable largely due to increased maintenance costs of truck and trailer fleets, made worse by rising fuel costs, tolls, and costs of employment. Additional challenges facing the South African mining industry include high levels of criminal activity, illegal mining, rising costs of employment, increased community activism in support of demands for the mines to provide municipal services (which should be provided by the South African government) and commercial opportunities , and Government bureaucracy and inefficiency, which means that applications for rights to prospect and mine, and the related environmental authorisations can take years, before they are processed and granted. The costs of doing business in South Africa, generally, and in the mining industry in particular, have risen extensively, and with all of the uncertainties surrounding the various challenges, the South African mining industry is gearing up for retrenchments and downscaling of operations, which can only have disastrous consequences on a socio-economic level for persons working at mines, or who rely on the mining industry, more broadly. We typically apply a multiplier of ten to one, “Of great concern is the fact that there are hundreds of mines in South Africa that are “ownerless” and have been abandoned for many years.” SOUTH AFRICA 113
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