Clock ticks as Aussie miner sues govt
Mbongeni Mguni | Friday October 25, 2013 16:03
Mount Burgess says it spent Aus$14 million (P114 million) between 2003 and 2012, on various studies and activities on two Ngamiland sites, eventually proving mineralisation of 33 million tonnes of both zinc and silver. It applied for a two-year extension on the leases last March and alleges the Ministry of Minerals, Energy and Water Resources took 14 months of assessment before eventually rejecting the request.
The Australia Securities Exchange-listed (ASX) company claims to have spent an additional Aus$1.2 million (P9.7 million) on the Ngamiland sites, in the 14 months of assessment.
Last Friday, Mount Burgess directors said legal proceedings against government had kicked off, with the filing of a Notice of Motion at the High Court. The legal proceedings follow the failure of an appeal the company filed with the Office of the Vice President in June.
At the time, the Vice President referred the appeal back to Minerals Minister, Kitso Mokaila, who stuck by his original decision citing “issues of law” and the company’s alleged failure to adhere to the Mines and Minerals Act.
“The Notice of Motion and affidavit were registered by the High Court on 8 October 2013 and served on the office of the Attorney General, Botswana on 11 October 2013,” Mount Burgess said in a statement on Monday.
“The respondent has 14 days within which to respond to the Notice of Motion”.
According to Mount Burgess, the Notice of Motion outlines an application to the High Court for an order that government’s decision to reject the miner’s request be set aside immediately. Mount Burgess also wants government to pay costs of the suit should it oppose the High Court application.
By yesterday, a spokesperson at the Attorney General’s Chambers was yet to confirm receipt of the High Court notice as requested by Mmegi Business’ written enquiry.
In prior papers, Mount Burgess said it had received legal opinion indicating a lawsuit against the rejection as well as for damages for operational costs, would be successful.
“We conclude that the rejection of the application for extension was unlawful and in direct contravention of the common law,” Mount Burgess CEO, Nigel Forrester said, quoting a legal opinion document.
“(The ministry of) Minerals, Energy and Water Resources is legally bound to grant it”.
The looming court battle is expected to centre on Mount Burgess’ failure to conduct and produce a feasibility study as required by the ministry’s prospecting programme agreed upon with the company in the expired leases.
Mount Burgess contends that it could not produce a feasibility study as required by the ministry, as no power was available at the sites. Under an ASX mandatory mineral code, a feasibility study cannot be said to have been conducted when the availability of electricity cannot be demonstrated.
For his part, Mokaila is on record as stating that by law the agreed upon prospecting programme cannot be unilaterally altered as a matter of law.
“In addition, any holder of a mineral concession under the Mines and Minerals Act is required to comply with the relevant sections irrespective of the company’s international reporting requirement,” he wrote in a document published by Mount Burgess as part of its ASX disclosure obligations.
“(The) prospecting licence has already exhausted two permissible renewals (and) any further renewal for a period in excess of the periods specified (in the Act) may be granted where a discovery has been made”.
By law, qualifying explorers are granted an initial three-year prospecting licence, followed by two renewals of two years each, both of which are dependent on ministerial approval. The explorer loses a percentage of their lease area on each renewal.