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VOLUME: XIV
MINES AND MINERALS
CHAPTER: 66:01
Part:VI Mining Licences (ss 37-51)

 

37. Who may apply for a mining licence

 

(1) Subject to the provisions of this Act, the holder of a prospecting licence, retention licence, or a waiver issued under subsection (3) may apply for a mining licence for an area in respect of which the waiver has been issued, or for an area within his prospecting area or retention area, in respect of the mineral covered by such prospecting licence, retention licence or waiver, and in the case of a prospecting licence or a retention licence, the issue of a mining licence shall have the effect of reducing the prospecting area or retention area, as the case may be, by the area in respect of which the mining licence is granted.

(2) An application made under subsection (1) shall be made not less than three months prior to the expiry of the prospecting licence or retention licence.

(3) Where the Minister is satisfied that the area over which a mining licence is required has been sufficiently prospected and that no other person has exclusive rights over that area, he may waive the requirements of subsection (1), provided that where a waiver is granted in respect of an area over which a retention licence is current, the Minister shall notify the holder of the retention licence of the granting of such waiver.

(4) Notwithstanding the provisions of subsection (1), an application for a mining licence may only be made by a company incorporated under the Cap. 42:01 Companies Act, which intends to carry on the sole business of mining under the mining licence applied for.

(5) For the purposes of subsection (1), the expression "holder of a prospecting or retention licence" shall include a company formed between such holder and any person or persons invited by such holder for the purposes set out in subsection (4) above.

 

38. Application for a mining licence

 

A person wishing to obtain a mining licence shall apply to the Minister by submitting an application in Form V of the First Schedule.

 

39. Grant of a mining licence

 

(1) The Minister shall grant a mining licence if satisfied that-

(a) the proposed programme of mining operations will ensure the most efficient and beneficial use of the mineral resources in the proposed mining area;

(b) the proposed mining area is not the same as nor does it overlap an existing mining area or retention area unless the holder of that area consents to the grant of a mining licence, or in the case of a retention licence, has failed to make application in terms of section 35(1);

(c) the proposed mining area extends to cover only that area reasonably required for surface mining and treatment facilities and also to cover the proved, indicated and inferred reserves;

(d) the applicant has or has secured access to adequate financial resources, technical competence and experience to carry on effective mining operations;

(e) the proposed financing plan submitted as part of the feasibility study is in accordance with good financial practice, and provides for a debt to equity ratio of no more than 3:1 unless the Minister otherwise agrees;

(f) the parent company guarantee in the prescribed form has been furnished;

(g) the applicant is not in default, and

(h) in the case of an application to mine diamonds, agreement has been reached following a negotiation under section 51.

(2) The Minister shall not reject an application on any of the grounds referred to in-

(a) subsection (1)(a) or (e), unless the applicant has been so notified and has failed to propose reasonable amendments satisfactory to the Minister to his proposed programme of mining operations or financing plan within three months of such notification;

(b) subsection (1)(g), unless the applicant has been given details of the default and has failed to remedy the same within three months of such notification.

(3) The Minister may cause such investigations to be made or such negotiations or consultations to be carried on as he may deem necessary to enable him to assess whether or not the criteria in subsection (1) has been satisfied.

(4) In the case of competing applications for a mining licence over the same or overlapping areas, the Minister shall grant a licence to the applicant whose programme will make more beneficial use of the mineral resources of the area.

 

40. Government investment

 

(1) Upon the issue of a mining licence, the Government shall have the option of acquiring up to 15% working interest participation in the proposed mine in the following manner-

(a) upon its exercise of its option Government shall be issued a single P1.00 special share at par, which shall carry the right to appoint up to two directors, with alternates, and to receive all dividends or other distributions in respect of its working interest percentage; and

(b) government shall be obliged in the same manner as other share holders to contribute its working interest percentage of-

(i) all audited arms-length expenditure incurred by the company to which the licence was issued that is directly attributable to the acquisition of the licence, including relevant prospecting expenditure; and

(ii) all expenditure on the mine incurred subsequent to the issue of the mining licence.

(2) Government shall on issuing the licence inform the applicant as to whether or not it is exercising its option and of the working interest percentage it wishes to take.

(3) The provisions of this section shall not apply to a licence to mine diamonds, where the extent and terms of Government participation shall be agreed under section 51.

 

41. Form and content of mining licence

 

A mining licence shall be in Form VI of the First Schedule, save that a licence to mine diamonds shall have annexed to it a copy of the agreement reached under section 51.

 

42. Duration and renewal of mining licence

 

(1) Subject to the provisions of this Act, a mining licence shall be valid for such period, not exceeding 25 years, as is reasonably required to carry out the mining programme.

(2) The holder of a mining licence may apply to the Minister for the renewal of his licence at any time not later than one year before the expiry of such licence.

(3) An application for renewal of a mining licence shall be in Form V of the First Schedule.

(4) The Minister shall grant an application for renewal if satisfied that-

(a) the applicant is not in default;

(b) development of the mining area has proceeded with reasonable diligence;

(c) the proposed programme of mining operations will ensure the most efficient and beneficial use of the mineral resources in the mining area; and

(d) in the case of an application for renewal of a licence to mine diamonds, agreement has been reached following negotiation under section 51.

(5) The Minister shall not reject an application on the ground referred to in-

(a) subsection (4)(a), unless the applicant has been given details of the default and has failed to remedy the same within three months of such notification;

(b) subsection (4)(b), unless the applicant has been given reasonable opportunity to make written representations thereon to the Minister; or

(c) subsection (4)(c), unless the applicant has been so notified and has failed to propose amendments to his proposed programme of mining operations satisfactory to the Minister within three months of such notification.

(6) Subject to the provisions of this Act, the period of renewal of a mining licence shall be such period, not exceeding 25 years, as is reasonably required to carry out the mining programme.

(7) On the renewal of a mining licence the Minister shall append thereto the programme of mining operations to be carried out in the period of renewal.

 

43. Amendment of programme of mining operations

 

The holder of a mining licence may, from time to time, notify the Minister of amendments he wishes to make to his programme of mining operations and such amendments shall, unless the Minister rejects them within three months after being so notified, have effect after such period.

 

44. Rights conferred by mining licence

 

(1) Subject to the provisions of this Act or any other written law the holder of a mining licence may, in the exercise of his rights thereunder, enter upon any land to which his mining licence relates with his servants and agents and may-

(a) take all reasonable measures on or under the surface to mine the mineral to which his mining licence relates;

(b) erect the necessary equipment, plant and buildings for the purposes of mining, transporting, dressing, treating, smelting or refining minerals recovered by him during mining operations;

(c) dispose of any mineral product recovered;

(d) prospect within his mining area for the mineral for which he holds a mining licence and for any other mineral; and

(e) stack or dump any mineral or waste product in a manner approved by the Director of Mines.

(2) If, in the course of exercising his rights thereunder, the holder of a mining licence discovers any further deposits of the mineral for which he holds a mining licence or any mineral not included in such licence, he shall, within 30 days after such discovery, notify the Minister thereof, giving particulars of the mineral discovered and the site and circumstances of the discovery, and may, subject to section 51, apply to the Minister to have the mining of such deposit or such mineral included in his mining licence, giving in his application a proposed programme of mining operations in respect of that mineral.

(3) Subject to section 51, if the Minister is satisfied with the proposed programme of mining operations submitted under subsection (2), he shall approve such application and shall amend the mining licence accordingly.

(4) The Minister shall not reject an application under subsection (3) above unless he shall first give the applicant opportunity to amend the programme in a manner satisfactory to the Minister.

(5) Subject to section 51 and subsection (7) below, the holder of a mining licence may apply to the Minister to have his mining area enlarged and the Minister shall, subject to the provisions of subsection (6), approve such application if he is satisfied that such approval will ensure the most efficient and beneficial use of the mineral resources of Botswana.

(6) A mining area shall not be enlarged so as to include any area which is not contiguous to the mining licence.

(7) The applicant for enlargement of a mining licence area shall be the holder of a prospecting licence, a retention licence, or a waiver in respect of the area sought to be added to the mining area.

 

45. Obligations of holder of mining licence

 

(1) Subject to the provisions of this Act, the holder of a mining licence shall-

(a) commence production on or before the date referred to in the programme of mining operations as the date by which he intends to work for profit;

(b) develop and mine the mineral covered by his mining licence in accordance with the programme of mining operations as adjusted from time to time in accordance with good mining and environmental practice;

(c) demarcate and keep demarcated the mining area in such manner as may be prescribed and, within three months of the date referred to in paragraph (a), submit to the Minister a diagram of the mining area;

(d) keep and maintain an address in Botswana, full particulars of which shall be registered with the Minister, to which all communications and notices may be addressed; and

(e) notify the Minister as soon as he begins to work his mining area for profit.

(2) The holder of a mining licence shall-

(a) maintain at the address kept in accordance with subsection (1)(d)-

(i) complete and accurate technical records of his operations in the mining area;

(ii) copies of all maps and geological reports, including interpretations, mineral analyses, aerial photographs, core logs, analyses and test results obtained and compiled by the holder in respect of the mining area;

(iii) accurate and systematic financial records of his operations in the mining area and such other books of accounts and financial records as the Minister may require; if such holder is engaged in any other activity not connected with his operations under the mining licence, he shall maintain separate books of accounts of his operations under such licence;

(b) permit an authorized officer at any time to inspect the books and records maintained in pursuance of paragraph (a) and shall deliver to the Minister, without charge, copies of any part of such books and records as the Minister may from time to time require;

(c) submit to the Minister such reports, records and other information as the Minister may from time to time reasonably require concerning the conduct of his operations in the mining area; and

(d) furnish the Minister with a copy of his annual audited financial statements within six months of the end of each financial year.

 

46. Wasteful mining and treatment practices

 

(1) No holder of a mining licence shall engage in wasteful mining or treatment practices or conduct his operations otherwise than in accordance with good mining practice.

(2) If the Minister considers that the holder of a mining licence is in breach of subsection (1), he may notify him accordingly and require him to show cause why he should not discontinue such breach.

(3) If, within the time specified in any notice issued under subsection (2), the holder of a mining licence fails to discontinue the breach or to satisfy the Minister that he is not in breach, the Minister may direct the holder to discontinue the breach and the holder shall comply with such direction.

 

47. Suspension of production

 

(1) The holder of a mining licence shall notify the Minister-

(a) one year in advance, if he proposes to cease production from his mine;

(b) six months in advance, if he proposes to suspend production from his mine;

(c) three months in advance, if he proposes to curtail such production, and shall, in all cases, give reasons for such cessation, suspension or curtailment.

(2) If, for reasons beyond his control, the holder of a mining licence terminates, suspends or curtails production from his mine without giving notice in accordance with subsection (1), he shall, within 14 days of such termination, suspension or curtailment, notify the Minister thereof.

(3) On receiving notification under subsection (1) or if he otherwise becomes aware of any cessation, suspension or curtailment of production, the Minister may cause the matter to be investigated and may either-

(a) give his approval to such cessation, suspension or curtailment; or

(b) if this is in accordance with good mining practice, direct the holder of the mining licence to continue or resume full production at the mine.

 

48. Export of radioactive minerals

 

(1) No person shall export any radioactive mineral except under and in accordance with the terms and conditions of a permit granted by the Minister.

(2) The grant of a permit under subsection (1) shall be at the discretion of the Minister exercised reasonably.

(3) A permit issued under subsection (1) shall be in such form and shall be subject to the payment of such fee and such reasonable terms and conditions as the Minister may determine.

 

49. Trading in mining areas

 

(1) No person shall, in any mining area, carry on any business for which a licence is required under the Trade and Liquor Act without the consent of the Minister:

Provided that such consent shall not entitle any person to carry on any such business except under and in accordance with the provisions of the Trade and Liquor Act.

(2) No person shall, in any mining area, erect any building or other structure for the purpose of carrying on any such business without the consent of the holder of the mining licence.

 

50. Transfer or assignment of mining licence

 

(1) No mining licence or any interest therein shall be transferred, assigned, encumbered or dealt with in any other way without the approval of the Minister.

(2) In any application to the Minister for his approval under subsection (1), the applicant shall give such particulars concerning the proposed transferee, assignee, or other party concerned as would be required in an application for a mining licence.

(3) Subject to section 51, the Minister shall grant his approval to the transfer, assignment, encumbrance or other dealing with any mining licence or interest therein provided the transferee is not disqualified under any provision of this Act from holding a mining licence and the Minister is satisfied in accordance with section 39.

(4) For the purposes of this section, "interest" in a mining licence shall mean in the case of a holder who is a private company, a controlling interest in such holder.

 

51. Negotiations over mining licence for diamonds

 

(1) Notwithstanding the provisions of this Part, any application for the issue, renewal, transfer or amendment of a licence to mine diamonds shall initiate a negotiating process, in good faith, between Government and the applicant covering all technical, financial and commercial aspects of the proposed project including Government participation.

(2) Should the negotiations not lead to agreement within six months or such extended period as the Minister may allow, the application shall fail.

(3) Upon successful conclusion of the negotiation under subsection (1), the Minister shall issue a licence reflecting the terms and conditions agreed.