Community scores big time in mine deal
Community will own 20% of the Somkhele Mine.
MPUKUNYONI community members are set to benefit directly from mine ownership, as Petmin, Somkhele anthracite mine‘s holding company, on Wednesday announced a R350-million Broad Based Black Economic Empowerment (BBBEE) deal which will see the community owning 20% of the mine.
Subject to shareholder approval, the deal aims to expand communities’ opportunities to benefit from mineral exploitation in South Africa.
An important component of this empowerment is expanded ownership of mining assets.
‘From inception it has been Petmin’s strategic intention to embrace the spirit of BBBEE for the mining industry, as determined in the MPRDA (Mineral and Petroleum Resources Development Act),’ said Petmin Chief Executive Jan du Preez.
‘Petmin believes that to ensure long-term sustainable empowerment, it is imperative that local communities and employees become owners so they can participate and share in the economic benefit of our operations, and beyond the life of our operations.’
The community trust will benefit the youth through various projects. Additionally, the Mpukunyoni community will receive a guaranteed R1-million annually to support development projects.
Community and employee trusts will be formed and they will own 20% of Tendele Coal Mining (Pty) Ltd, the owner of Somkhele mine, initially through a Special Purpose Vehicle (SPV) and subsequently through direct share ownership in Tendele.
Petmin’s shareholding in Tendele will be reduced to 80%.
The deal was negotiated with the Mpukunyoni Traditional Council, representing the 175 000-strong community, and with trade unions representing Tendele workers.
‘We believe Somkhele mine will make a difference in the lives of the community and the BBBEE transaction will have a positive and lasting impact on the community,’ said Qhina Mkhwanazi, Mining Portfolio Head and member of the Mpukunyoni Traditional Council.
Welcoming the deal, the National Union of Mineworkers (NUM) said, ‘We are proud that we have won material benefits for our members’.
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