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Amadiba Crisis Committee submission to DME

The Legal Resources Centre's submission to DME on behalf of the ACC and Xolobeni community is rather long-winded and dry; but also interesting, and thoroughly convincing: 



Appeal/review instituted by:


Directed to:


On or around 29 July 2008, the Director General purportedly took a decision to grant a mining right to Transworld Energy and Minerals Resources (SA) (Pty) Ltd ("TEM") in the Kwanyana Block of the Xolobeni tenement area ("the decision").

On 2 September 2008, the Amadiba Crisis Committee ("the ACC") lodged a notice of appeal against the decision in terms of section 92(1)(b) of the Mineral and Petroleum Resources Development Act 28 of 2002 ("the MPRDA") alternatively an application to review the decision in terms of section 103(4)(b) of the MPRDA on the grounds that:

First, the decision was taken by an authority not empowered to grant mining rights and was accordingly ultra vires;

Second, the mining right could not be lawfully granted because:

the Xolobeni area is part of a Marine Protected area where commercial prospecting and mining cannot take place at all;

the Xolobeni area lies in a protected area where mining can only take place with the written permission of the Minister and the MEC for 
minerals and energy and the Minister of Environmental Affairs and Tourism. Such written permission was never provided;

the Xolobeni area lies on land that is being used for a public purpose or which is reserved in terms of other law; and/or

no community resolution was passed authorising mining activities on the land.

Third, the public consultation process undertaken on behalf of TEM was fatally flawed because:

there was insufficient notice of public meetings;

the members of the Xolobeni community were not properly consulted;

inaccurate or incomplete information was provided to the community;

not all aspects that required to be addressed with the affected community were raised or addressed;

Xolobeni Empowerment Company (Pty) Ltd ("Xolco") does not represent the community; and/or

the public consultations were a sham and ought to have been disregarded by the Department .

Fourth, the Department failed properly to consult as required by the MPRDA, in that:

it ought to have given the Xolobeni community a hearing before granting the Mining Right; and/or

it did not have due regard to the views of the Department of Environmental Affairs and Tourism.

Fifth, TEM's EIA was deficient in that:

it failed to provide key environmental reports, including baseline reports;

it failed to consider and assess alternative land uses;

cumulative impacts were not assessed; and/or

it failed properly to indicate how concerns raised by the interested and affected parties had been addressed.

Sixth, the Director General did not have sufficient information before him on the environmental impact of the mine to take a decision.

Seventh, the mining will, as a matter of fact, cause unacceptable pollution, environmental degradation and/or damage to the environment.

Eighth, TEM's application may have been deficient in a number of ways.

On any of these grounds, the decision to grant TEM is invalid and ought to be withdrawn. The ACC persists in each of the above grounds, in addition to relying on the supplementary grounds set out below.


As appears from annexure ACC1, the Department of Minerals and Energy ("the Department") initially indicated that the ACC should lodge an internal appeal to the Minister. The ACC accordingly filed lodged an appeal (and in the alternative, a review) in accordance with regulation 74. It was anticipated that, in terms of that regulation, the Minister 

dispatch copies of its appeal to the Director General to provide written reasons for the decision within 21 days;

dispatch copies to TEM to file submissions on whether the appeal should be granted within 21 days;

allow the ACC an opportunity to respond to the record of decision and TEM's submissions; and

take a decision on the internal appeal within 30 days.

Despite the ACC's requests (contained, for example, in a letter sent the Department on 8 May 2009 and annexed as "B"), the Department has not complied with the above procedure. Instead, on 15 May 2009, the Department delivered a letter to the ACC's legal representatives (dated 20 April 2009) stating that notwithstanding its earlier indication, there was no competent internal appeal and the Minister would only consider amending or withdrawing the decision in terms of section 103(4)(b). A copy of that letter is annexed as "C".

Simultaneously with its letter of 15 May 2009, the Department furnished an incomplete record of decision and TEM's submissions to ACC and called 
on it to furnish its response thereto by 15 July 2009.

On request from the ACC (contained in the letter attached as "D"), the Department furnished further documents and Xolco's submissions (without 
annexures) on 26 June 2009, and called for the ACC's further submissions by 31 July 2009. A copy of that letter is annexed as "E".

As appears from the letter attached as "F", the Department provided the remainder of the record and Xolco's submissions on 3 July. It also 
extended the date for filing these further papers to 17 August 2009.

Subsequently, on 11 August 2009, the ACC requested an extension to file expert reports that establish that the area will be objectively incapable of rehabilitation if the proposed mining proceeds, and that the impact of the mining on the environment will accordingly be significant and permanent. Annexure "G" is a copy of the letter seeking 
an extension to file these expert reports in due course. Subsequently, the ACC also requested an extension to file affidavits in support of these submissions. Such requests were granted by the Department on 14 August 2009, and further documentation will be filed by 28 September 2009.

In the interim, these submissions will address:

The Minister's powers in the review process;

The ACC's supplementary grounds of review, namely:

TEM's application for a mining right was deficient and defective;

TEM failed to establish that mining on Kwanyana block alone is feasible and will take place;

TEM's environmental impact assessment was deficient and defective;

TEM failed to calculate the financial provision that must be made for remediation of environmental damage, and to furnish such financial guarantees;

TEM failed to furnish documentation requested by the Department;

The Department failed to have regard to submissions made by the Department of Enviromental Affairs and Tourism, in breach of the MPRDA and the principles of cooperative government;

The Department failed to refer objections to the Regional Mining Development and Environmental Committee, as required by section 10 of 
the Act; and/or

The Department determined to grant the Mining Right when information that it had requested had not been filed and, in so doing, prejudged the grant of the right.

Reply to TEM's submissions;

Reply to Xolco's submissions:

The ACC's standing to bring these proceedings

Xolco is not representative of the community, nor established for the benefit of the community; and

Xolco's petitions and its allegation that the mining is supported by the community;


The Minister has indicated that she will consider a review in terms of section 103(4)(b) of the MPRDA, but will not entertain an appeal in terms of section 96(1)(b). This election has important consequences for the manner in which she must approach these proceedings.

Section 103(4)(b) states:
"(4) The Minister, Director-General, Regional Manager or officer may at any time-
. . .
(b) withdraw or amend any decision made by a person exercising a power or performing a duty delegated or assigned in terms of subsection (1), (2) or (3) as the case may be."

Section 103(4)(b) allows for the reconsideration of a decision, rather than an internal appeal. It is trite that the appeal authority in an internal appeal may step into the shoes of the original decision-maker and decide the matter de novo, but that a reviewing authority is confined to considering the record which was before the original 

If the Minister is correct that there is no internal appeal available because the Director-General took the decision qua the Minister, then it follows that the Minister has taken a decision and can only re-consider it on the basis of the documents that were before the Department at the time the decision was taken; she cannot have regard to new documentation submitted by TEM subsequently.

There is a further reason why the Minister cannot have regard to new documents filed after the grant of the mining right. When a decision-maker takes a licensing decision under the MPRDA, he or she is 
required to consider and balance the competing interests of a number of different persons and groups. To facilitate these interests being taken 
into account, the MPRDA allows for various notice-and-comment procedures. Documents prepared by TEM after the grant of the right have not been the subject of notice-and-comment procedures and ought not be consider by the Minister.

It is also worth noting that, once the Minister takes a decision in terms of section 103(4)(b), she is functus officio in respect of TEM's application for a mining right and cannot take any further decision on that application. If TEM continues to seek a mining right, it will have to submit an entirely fresh application in accordance with all the formalities laid down in the MPRDA. This will be addressed further in the section dealing with remedies.

The ACC's notice of appeal/ application for review was prepared without sight of the record of decision because the Department failed and/or refused to furnish such record.

The ACC has now considered the record of decision, and submits that there are several further grounds on which the grant of the Mining Right was unlawful and invalid and ought to be withdrawn by the Minister. The ACC relies on these supplementary grounds as well as the grounds set out in the initial notice of appeal/ application for review.


Section 22(1)(b) of the MPRDA read with regulation 10 of the regulations enacted pursuant thereto requires an application for a mining right to 
contain, inter alia:

detailed documentary proof of the applicant's technical ability to mitigate and rehabilitate relevant environmental impacts;

budget and documentary proof of the applicant's financial ability or access thereto, including loan agreements entered into for the purposes of the proposed mining operation, a resolution by the company to provide the necessary finances, or any other mechanism or scheme providing for the necessary finances;

a certified copy or copies of the title deed or deeds in respect of the land to which the mining application relates;

a mining work programme in accordance with regulation 11, which must contain:

the details of the identified mineral deposit concerned including the type of mineral or minerals to be mined, its locality, extent, depth, geological structure, mineral content and mineral distribution;

the details of the market for, and the market's requirements and pricing in respect of, the mineral concerned;

a financing plan which must contain:

the details and costing of the mining technique, mining technology and production rates applicable to the proposed mining operation;

the details and costing of the technological process applicable to the extraction and preparation of the mineral or minerals to comply with market requirements;

the details and costing of the technical skills and expertise and associated labour implications required to conduct the proposed mining operation; and

the details and costing of regulatory requirements in terms of the Act and other applicable law, relevant to the proposed mining operation;

the details regarding other relevant costing, capital expenditure requirements, and expected revenue applicable to the proposed mining 

a detailed cash flow forecast and valuation, excluding financing of the proposed mining operation, which forecast must clearly indicate how the applicable regulatory costs will be accommodated therein; and

the details regarding the applicant's resources or proposed mechanisms to finance the proposed mining operation, and details regarding the impact of such financing arrangements on the cash flow forecast.

It is appears from the record of decision that TEM'S application did not contain this information.

The requirements of section 22(1)(b) and Regulation 10 are peremptory. 
Where an application does not comply with these prerequisites, the Regional Manager must return the application to the applicant.
Section 22(3) of the MPRDA

Instead, he recorded in his report recommending that the Director General grant the mining right that "the applicant has complied with all the application requirements of section 22(2) and 22(4) and that the 
necessary internal procedures have been complied with."Regional Managers report, p 3, para 4.1

Neither the Regional Manager nor any other official in the Department had a discretion to condone TEM's failure to comply with the application requirements.
Section 22(4) of the MPRDA
Le Roux and Another v Grigg-Spall 1946 AD 244 at 252
SA Co-operative Citrus Exchange Ltd v Director General Trade and Industry and Another 1997 (3) SA 236 (SCA) at 241
Minister of Environmental Affairs and Tourism v Du Toit and Others 
[2003] ZASCA 77; (5 September 2003) at para 31-33

Accordingly, TEM's application was defective and the grant of the right was ultra vires. On this basis alone, the Minister should withdraw the grant of the mining right.

In terms of section 23(1)(a), the Minister can only grant a mining right if the applicant has established that the mineral can be mined optimally. It is clear from this provision that a mining right should only be granted where the applicant establishes that the mine is feasible and that it will in fact undertake mining operations.

It is clear from the record that TEM did not undertake feasibility studies in respect of mining the Kwanyana Block.

At page 38 of its Social and Labour Plan (submitted in February 2007), the applicant states:
"Because of the substantial cost for the next stage of feasibility work (ie the detailed bankable feasibility study ("BFS")), a mining right approval is essential as security of tenure in order for TEM to commit to the "pre-mining" phase of works as well as to fund the completion of the BFS, EIA and power supply study".

Subsequent to the grant of the mining right in July 2008, TEM addressed a letter to the Director: Mineral Development - Eastern Cape (dated 1 October 2008) where it reiterates that:"In order for Kwanyana block to be considered as a stand alone operation it will be the subject of a feasibility [study] to be carried out as soon as the mining right is formally granted and the licence instrument 
. . .
it is essential the Mining Right be signed into execution by the end of 2008. This will allow long term security of tenure in order to be able to commit to the next stage of project development, including the completion of the feasibility studies for the Kwanyana as a stand alone operation, the bankable feasibility, finalization of the EIA studies and EMP outcomes . . ."

It is submitted that a feasibility study is a prerequisite for the grant of the mining right, and TEM was not entitled to delay the study until the mining right had been granted. On this further basis, it is submitted that a mandatory prerequisite for the grant of the mining right was not met and the right could not properly be granted. On this 
further basis, the grant of the mining right should be withdrawn.

Section 39(2) of the MPRDA requires every person who has applied for a mining right in terms of section 22(1) to conduct an environmental impact assessment (EIA) and to submit an environmental management plan.

As pointed out in the notice of appeal/ application for review, the EIA submitted by TEM was deficient because, inter alia, certain studies were not undertaken.
Notice of appeal, p 44-51, para 130-135

It now appears from the record that TEM acknowledged that it was required to undertake certain studies prior to submitting its final EIA, but that it did not do so. In a letter sent by TEM to the Director: 
Mineral Development - Eastern Cape on 1 October 2008 (that is, after the grant of the mining right), it stated:

"The DME was approached [by TEM] for an extension to the 22 October submission date [for the EIA/EMP] in order to address a number of issues and undertake the following studies:
An Environmental Resource Economics Study;
Determination of the estuarine reserve (separate from the overall reserve);
A comparison between the benefits of tourism versus the benefits of mining in the area; and
Determination of the dune slack.
Two of the above mentioned studies require significant time and resources in order to be completed to a satisfactory bankable level.
. . .
A provisional Mining Right in respect of the above application was granted by the DME on 29 July 2008 with the official Xolobeni MR instrument to be issued on the 31 October 2008 and the EMP to be signed accordingly. . . . The DME requested that the EIA and EMP be reviewed to reflect the Kwanyana area only.
TEM advised DME that there would be problems with the limited time and specialist consultants not being available and only a review of the existing data and previous specialist reports could be carried out in order to achieve a mostly desktop update for the Kwanyana area.
. . .
TEM has outlined that in order to complete the full EIA for the project the final feasibility must be commissioned so that the design data can be fed back into the EIA for the mitigations necessary for the EMP. As outlined, TEM has advised DME that such feasibility study can only be completed under the security of a mining right."

It is clear from the contents of this letter that:

TEM did not complete an EIA for the relevant portion of land prior to the grant of the mining right; and

certain studies explicitly requested by the Department were not undertaken.

On this further basis, TEM's application was defective and a mining right ought not to have been granted.

In his report recommending the grant of the mining right, the Regional Manager records that:
"Due to the fact that the Environmental Impact Assessment (EIA) has not concluded that the mining in the Mpahlane, Myameni, Sikombe and Mthethu 
will not result in unacceptable pollution and ecological degradation of the environment, it is proposed that the granting of the right be 
considered in respect of the mining of Heavy Minerals on an area of State Land which is situated in the Kwanyana block."

He does not record that no EIA or feasibility studies have been conducted in respect of the Kwanyana block only. With respect, his 
approach is wrong in law.

It is submitted that the mining right could not be granted until a complete EIA had been provided in respect of mining operations in the Kwanyana block only. In the absence of that, a mandatory requirement for the grant of the mining right was not met and the right could not properly be granted.

An applicant for a mining right must make financial provision for the rehabilitation or management of negative environmental impacts caused by 
its mining operations.
Section 41(1) of the MPRDA

Regulation 54 prescribes that the quantum of financial provision must be calculated in accordance with the Department's guideline document and must include a detailed itemization of all actual costs for:

the rehabilitation of the surface of the area, the prevention and management of pollution of the atmosphere, the prevention and management of pollution of water and the soil and the prevention of leakage of water and minerals between subsurface formations and the surface, in the case of premature closing of the mine;
decommissioning and final closure of the operation; and
post-closure management of residual and latent environmental impacts.
In terms of regulation 53, financial provision must be provided by:
making an approved contribution to a trust fund;
providing a financial guarantee from a bank or other financial institution;
making a deposit into an account specified by the Director General; or
any other method determined by the Director General.

It appears from the record that TEM has not calculated the costs for remediation of environmental damage or made financial provision at all.

While financial provision for environmental remediation is a prerequisite for the grant of the EMP (rather than the mining right), 
TEM should by this stage have given some indication that it has applied it mind to the issue of remediation costs, and have indicated that it is 
financially capable of providing such guarantees. In absence of such steps, the mining right ought not to have been granted. On this further basis, the ACC seeks to have the grant of the mining right withdrawn.

On 4 June 2008, the Department addressed a letter to TEM requesting it to provide further documentation to enable the Department to consider its application, including:

a detailed mining plan setting out, inter alia, the mine design with all the proposed infrastructure;

layout of all infrastructure for all mining and other activities incidental to mining;

water reticulation defining inflow and outflow of water quantities in the system;

a rehabilitation plan ;

the shareholders agreement entered into between TEM and Keysha Investments 178 (Pty) Ltd;

the structure and working agreement between Xolco and its member trusts, and the proposed benefits for the community from participating in the project;

The total cost of the measures to manage environmental degradation, calculated and assigned to the categories of concurrent annual cost, immediate closure cost; end of life of mine cost, and post closure cost; and

The total liability generated by mining activities for the duration of the project.

Such documentation does not appear to have been provided at the time that the Regional Manager recommended the grant of the mining right on 
23 June 2008, or by the time the mining right was purportedly granted on 29 July 2008. It is submitted that, on the Department's own assessment, there was insufficient information before it to grant the mining right. 
On this further basis, the mining right should be withdrawn.

In the notice of appeal/ application for review, the ACC submits that the Department granted the mining right without giving due consideration to the views of and objections raised by DEAT.
Notice of appeal, p 44, para 126-129

This complaint is strengthened by the correspondence between the Department and the DEAT disclosed in the record:

On 28 May 2007, the Department sent the draft scoping report to the DEAT and requested comments by 12 June 2007 (failing which it would be assumed that there were no objections or comments). Such time period is manifestly insufficient to allow the DEAT properly to consider and comment on the scoping report.

On 17 September 2007, the Department sent the amended scoping report to the DEAT for comment by 5 October 2007. Again, the Department stated that if comments were not submitted timeously, it would assume that there were no comments or objections to be raised.

In response, on 21 September 2007, the DEAT wrote to the Department and requested an extension to the time period for submitting comments, on the basis that several sections of the DEAT would need to be consulted internally before comments could be filed.

On 28 September 2007, the Department refused the DEAT's request for an extension for filing comments because it required TEM to submit its EIA and EMP on 22 October 2007 and "to be administratively just the DME must afford the applicant a reasonable time to effect any changes to the EMP". However, on 20 September 2007, TEM had itself requested an extension to file the EIA and EMP (which the Department refused). There could have been no prejudice if the Department had granted an extension 
both to TEM and to DEAT. (As will appear below, TEM's request for an extension was subsequently granted, while DEAT's was not.)

The DEAT repeated its request for an extension for filing comments on the 2 October 2007. No response to this letter is included in the record, and it must be assumed that the Department did not reply.

On 5 October 2007, the DEAT raised various objections to the revised scoping report, including that it was incomplete, omitted important studies and did not sufficiently take into account the authorization required under the National Environmental Management Act 107 of 1998 ("NEMA").

The Department does not appear to have raised the DEAT's concerns with TEM or to have engaged further with the DEAT.

On 24 October 2007, the Department sent the EIA and EMP to DEAT and requested comments by no later than 21 December 2007. This time period was plainly insufficient, both in light of the volume and complexity of the EIA and EMP and in terms of section 40 of the MPRDA, which requires that other departments be given 60 days to comment on an EMP.

On 12 November 2007, the Department wrote again to the DEAT recording that it had granted TEM an extension to 26 November for filing further 
documents. It nevertheless requested comments from the DEAT by 12 December 2007.

On 28 December 2007, the DEAT filed comments objecting to TEM's EIA and EMP on 28 December 2007 on eleven substantive grounds, namely that:

mining would cause irreversible damage to estuaries and wetlands, even with TEM's proposed mitigation measures;
mining would cause permanent loss of biodiversity and the extinction of 
aquatic fauna;
insufficient information was provided on proposed buffer zones around 
rivers and estuaries;
mining may pollute ground water;
mining may negatively affect the adjacent Mkambati Nature Reserve;
the EIA environmental studies were incomplete and relied on outdated sources;
the EIA lacked crucial specialist studies;
the EIA did not meet NEMA requirements and applications for environmental authorisations have not been received;
the EIA provided insufficient details about rehabilitation measures;
the EIA provided insufficient information about the waste storage and treatment plans; and
complete rehabilitation of the visual impact of the area is impossible.

Despite these clear objections to the mining and the call for further investigations, the report from the Regional Manager to the Director General recommending that the mining right be granted records that "No objections were received within the 30 day period." It would appear that 
the Department disregarded the objections raised by DEAT on the basis that they were submitted out of time.

Section 41(1) of the Constitution requires that:
"All spheres of government and all organs of state within each sphere must
. . .
(h) co-operate with one another in mutual trust and good faith by:
(i) fostering friendly relations;
(ii) assisting and supporting one another;
(iii) informing one another of, and consulting one another on, matters of common interest. . ."

[emphasis added]

The principles of cooperative government require that different government departments consult with one another on areas of mutual interest. The Department's failure to consider the comments and 
objections raised by the DEAT was in breach of its constitutional duties.

On this basis, it is submitted that the mining right was granted without relevant considerations being taken into account and should be withdrawn.

Section 10(2) of the MPRDA requires the Regional Manager to refer any objection to the proposed mining to the Regional Mining Development and 
Environmental Committee, which must consider the objection and advise the Minister on it.

The Department has confirmed that no Regional Mining Development and Environmental Committee ("REMDEC") meeting was held in relation to TEM's application because "no objections were received within the prescribed time period".
See Annexure F, para 4

Objections were clearly raised by interested and affected parties during the consultation process undertaken by TEM. It is clear from the minutes 
of those consultations furnished by the Department as part of the record that it was aware of those objections. Objections were also raised by 
DEAT (as outlined above). In the circumstances, the matter ought to have been referred to REMDEC in terms of section 10.

It is submitted that the failure to refer objections to REMDEC means that appropriate procedures were not followed. On this further basis, the grant of the mining right was invalid and should be withdrawn.

TEM filed very brief submissions in response to the ACC's appeal/review. The only matters of substance which require to be addressed are:

The allegation that "the ACC represents a small group living outside the Kwanyana Block and . . . being manipulated by anti mining NGO groups from outside the area and the country." This allegation is offensive and is strenuously denied. The ACC represents members of the Xolobeni community who are opposed to mining, particularly those people living in the Xolobeni area.

The allegation that the Xolobeni community was consulted through Ndabazakhe Baleni, the alleged Chief Headman of the Mngungundlovu Tribal Authority, and were largely in support of the mining.

As set out in the notice of appeal/ application for review, it is denied that Ndabazakhe Baleni is the headman of the Mngungundlovu Tribal Authority. The chief for the entire area is Lunga Baleni.
Notice of appeal, p 26, para 67.2-67.3

Regardless of which Baleni is rightfully the headman of the area, he is subject to the authority of the King and Queen of Pondoland. I annex hereto as "H" a letter sent by the King's legal representatives, which confirms that:

the King was not properly consulted about the mining;

the community has not passed a resolution authorising the mining and so the King has not released land for the purposes of mining; and

the majority of the community is opposed to mining and would prefer to develop tourism opportunities.

It is submitted that this evidence is determinative of the matter.

Xolco's submissions are that:
The ACC does not have authority to bring these proceedings;

Xolco is owned by five community trusts which operate for the benefit of the community and on its behalf;

The majority of the community supports the proposed mining, as appears from the petitions annexed to Xolco's submissions.

Each of these submissions will be addressed in turn.

The ACC does not have authority to bring these proceedingsXolco submits that the ACC comprises of a small faction of the community, numbering approximately 28 people and accordingly has no 
authority to bring these proceedings.
Xolco submissions, p 2, para 3

This is strenuously denied. The ACC comprises of a large number of community members who oppose mining in the Xolobeni area. However, even assuming that Xolco is correct, the ACC still has authority to bring these proceedings:

Xolco does not deny that ACC members are also members of the community. 
They are accordingly interested and affected persons under the MPRDA, and have standing to bring these proceedings on that basis alone.

In any event, section 32 of NEMA expressly grants wide standing to groups that seek to protect the environment or monitor the use of natural resources. It states:

"Any person or group of persons may seek appropriate relief in respect of any breach . . . of any provision of a specific environmental management Act, or any other statutory provision concerned with the protection of the environment or the use of natural resources -
in that person's or group of person's own interest;
in the interest of, or on behalf of, a person who is, for practical reasons, unable to institute such proceedings;
in the interest of or on behalf of a group or class of persons whose interests are affected;
in the public interest; and
in the interest of protecting the environment."

It has never been suggested that the ACC does not act bona fides in the interest of protecting the environment. Accordingly, it has standing to 
bring these proceedings.

Xolco is owned and operates for the benefit of the community and on its behalf
Xolco submits that:
"the Amadiba people . . . have, for the purposes of the Xholobeni [sic] Minerals Sands Project (the project) established XOLCO which, through 
Keysha Investments 178 (Pty) Ltd (Keysha), is a 26% shareholder in the project. XOLCO is owned by five community trusts."

Xolco does not and cannot represent the community in respect of the mining rights:

It is clear from the shareholders agreement with TEM that Xolco has financed its 26% share in TEM by issuing preference shares to TEM's major shareholders. Accordingly, Xolco's shares will be paid off from profits earned from the mining operations, if they go ahead. Xolco has a direct interest in mining operations taking place.

Xolco has disclosed the Trust Deed for each of the five trusts holding shares in Xolco. It is clear that:

The objective of each trust is to engage in a particular business, and 
to help fund business ventures. None of them is created strictly to perform a public service or serve a public function.
Trust deeds, clause 4.1

There is no obligation to pay any money toward beneficiaries (although the trustees have an unfettered discretion to pay income or capital to 
any beneficiary of their choice, without an obligation to provide reasons for such an award).
Trust deeds, clauses 6.2 and 8

The trust donor is entitled to appoint one trustee in perpetuity. In the case of four of the five trusts, there need only be two trustees and one 
is entitled to take all decisions and authorise all steps if the other is unable to act, for whatever reason. In all but one trust, the founder 
member is Mr Z Qunya.
Trust deeds, clause 7

All of the trusts were created in early 2004, some years before Xolco was created. Yet, none of them is known to the members of ACC and they do not put up an evidence of their work in or for the community's benefit.

It is clear that Xolco and its member trusts are private entities formed for the benefit of their members, and with a direct interest in the proposed mining going ahead. They are not democratically elected organisations and cannot speak or act on behalf of the local community.
See also notice of appeal/ application for review, p 41, para 117

The majority of the community supports the proposed mining

Xolco relies on a set of certificates purportedly signed by members of the Xolobeni community to establish that a majority of the community supports the proposed mining.

It should be noted that certain of the grounds of review relate to statutory barriers to a mining right being granted in Xolobeni at all. 
If these complaints are valid, then the grant of a mining right will be unlawful regardless of whether the majority of the community supports or opposes mining operations.

In any event, those certificates do not constitute reliable and/or admissible evidence:

The certificates are undated and no information is provided as to when they were collected, by whom and under what circumstances. In these circumstances, the certificates cannot be properly assessed or 
considered evidence.

A large number of the names are written in the same handwriting and the signatures are extremely similar to one another and no explanation has been furnished for such anomalies.

Several of the names are duplicated on different certificates.

In addition, at a community meeting held in Xolobeni on 6 August 2009, various members of the community confirmed that:
although their names appear on a certificate, they never signed such document;

several of the names that appear on the certificates are the names of deceased people;

several of the names that appear on the certificates are of people who do not live in the Xolobeni tenement area; and

they continue to be opposed to mining operations in the area. Affidavits in this regard will be filed on or before 28 September 2009.

It is submitted that, in the circumstances, the certificates furnished by Xolco are unreliable and should be disregarded. If anything, the Minister should have regard to the ACC's evidence that the majority of the Xolobeni community oppose the proposed mining operations.


It is submitted that, on the grounds set out in the notice of appeal/ application for review and supplemented in these papers, the mining right was clearly improperly granted to TEM, and ought to be withdrawn.

WHEREFORE the applicant calls on the Minister to withdraw the grant of the mining right to TEM.

Signed at GRAHAMSTOWN on this the 14th day of August 2009.

Appellants' attorneys
116 High Street
Sarah Sephton (sarah ~at~
Tel: 046-6229230


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