FINANCIAL PROVISIONING FOR REHABILITATION AND MINE CLOSURE: A study of South African platinum and coal mining companies

Posted in: Reports on May 1, 2018


Intellidex undertook the research underpinning the The Centre for Environmental Rights’ Full Disclosure report. 

The Council for Geoscience (CGS), a scientific research body contracted by the Department of Mineral Resources (DMR) to manage the ownerless and derelict mines database, estimates that there are at least 6,000 abandoned mines in SA. The ongoing environmental impact of these mines is a problem for the state and therefore for the taxpayer. The DMR rehabilitated 50 mines during the 2015/16 financial year. This highlights the need for improved environmental maintenance and rehabilitation in the mining sector during years of operation and beyond. This report considers the amounts being set aside by operating South African mining companies to pay for environmental rehabilitation when mines cease to operate.

South African laws require mining companies to set aside money for the management, remediation and rehabilitation of the environmental impacts of mining operations. Before commencing with mining, companies are required to draw up an environmental management plan which details how environmental impacts will be dealt with, and they are required to provide for the costs required to implement the plan. This plan and any subsequent revisions should be verified and approved by the DMR.

Intellidex studied 11 JSE-listed companies to determine how much they are providing. The three coal mining houses and eight platinum companies were selected according to the criteria explained in the methodology section of the report. Read more about the key findings  in the full report.

Download the full Intelidex report here.

Have your say.
Share your opinion

RELATED ARTICLES

STUART THEOBALD: Input myopia clouds BEE and other policies

May 11, 2021

By shunning outcomes, normal market mechanisms are turned on their head. read more

PETER ATTARD MONTALTO: From water-use to energy, performative focus sidetracks from real issues

April 19, 2021

The list of distractions from what matters seems never-ending. read more

STUART THEOBALD: Misguided criticism of banks’ Covid-19 roles

March 29, 2021

President is wrong to chide banks for not rolling out R200bn-worth of loans. read more