Category: Xolobeni

Xolobeni Sale Announcement

MRC ENTERS INTO MOU WITH BEE PARTNER TO DIVEST INTEREST IN XOLOBENI MINERAL SANDS PROJECT 

Mineral Commodities Ltd (“MRC” or “the Company”) advises that it has entered into a Memorandum of Understanding (“MOU”) with its Black Economic Empowerment (“BEE”) Partner for the Xolobeni Project, Keysha Investments 178 Pty Ltd (Keysha), to divest its 56% interest in Transworld Energy and Resources (SA) Pty Ltd (“TEM”), the entity which owns the Xolobeni Mineral Sands Project, to Keysha on terms to be agreed between the parties. 

MRC has committed significant financial, technical and social resources toward the development of the Xolobeni Mineral Sands Project (“Xolobeni Project”) since 2003. Throughout the past thirteen years, MRC has successfully worked with the regulatory development programme and IAP stakeholders. The Company has engaged in many years of ongoing and meaningful consultations with the local community at Xolobeni, and has always prioritised the wellbeing of the Amadiba Community. The Company has accepted that attempts to facilitate peaceful and safe site access by independent environmental consultants to adequately assess the possible environmental impacts of the Xolobeni Project continues to cause undue tensions and conflict, something that the Company has openly tried to avoid.

The Company has, and always will have an ambition to bring prosperity and economic upliftment to the local Amadiba Pondo land inhabitants and the greater Mbizana district, and continues to believe that the Xolobeni Project offers significant value to enable economic upliftment. In light of the ongoing violence and threats to the peace and harmony of the local Xolobeni community, the Company accepts that the future viability of the Xolobeni Project should be managed by stakeholders and organisations exclusively owned by South African people. As such and after due consideration, the Company has decided, subject to satisfactory commercial negotiations, agreement with the other remaining shareholder, and any regulatory or shareholder approvals that may be required, to divest of its interest in the Xolobeni Project. Accordingly the Company is pleased to announce that the Company and its wholly owned subsidiary MRC Resources Pty Ltd has entered into an MOU with its BEE partner, Keysha, for the sale of the Company’s shareholding interest in TEM. The decision was made after extensive consultation with Keysha, who shares the view that the development of the Xolobeni Project is critical to the social and economic upliftment of the local Amadiba Pondo land inhabitants and the greater Mbizana district, and that the Xolobeni Project’s development should not be influenced directly or indirectly by the stakeholder focus being placed on an international mining company, as opposed to legitimate debate surrounding the economic benefits (or otherwise) and the environmental issues concerning the development of the Xolobeni Project. The Company fully supports the ongoing development of the Xolobeni Project and its decision to divest is in no way a reflection of its commitments of its mining interests in South Africa. Further details of the terms of the proposed divestment in the Xolobeni Project will be notified upon signing of definitive sale agreements.

The Company continues to invest in and operate the Tormin Mineral Sands Operation (“Tormin”) on the West Coast of South Africa, which currently employs over 200 local community members of the Matzikama region. In addition, the Tormin operation employs 40 local members of the Amadiba Pondo region surrounding Xolobeni, which has been appointed as the Company’s designated labor sending area in accordance with Tormin’s Social Labour Plan and Mining Charter Agreement. The Company remains dedicated to providing the training, education and employment initiatives to the local members of the Amadiba Pondo region, in addition to the various community programmes such as the agricultural farming and primary livestock developments.

Educational Opportunities & Xolobeni

Mineral Commodities are committed to the investment in education in our people and in the communities with which we work.

The Company has various community and operational initiatives which are designed to increase measurable educational outcomes amongst community members and company employees, and we are very proud to report on the various programmes we administer.

Some of the programmes the Company facilitate include Adult Basic Education & Training (ABET), Learnerships,

Mdatya High School Infrastructure Project

Project Description – Presently, Mdatya High School is dilapidated and the pupils are exposed to safety and health risks and accordingly lacks structures which are imperative to the enhancement of quality education and to the proper functioning of the school.

 

The Company recognises the provision of quality education to learners as a national priority. In order to improve the quality of education within the mine community area, the Company, the Department of Education together with the community have identified the need to provide a reputable School and the Resource Centre at Mdatya High School. The project entails the construction of classrooms and the Resource Centre in order to provide learners with adequate learning material and resources to ensure that quality education and learning is offered to all learners at the school.

 

The Company will partner with the Department of Education in order to provide the decent classrooms and the necessary equipment and learning material required for the further development of this project. The Centre will be aimed at providing the schools with the following facilities: –

  • Library;
  • Staffroom;
  • Computer Facilities;
  • Store Room;
  • Principal’s Office; and
  • Computer Lab.

 

On completion of the project and the five-year cycle, the Company will hand over the project to the Department of Education.

The budget for this project alone is currently set at R17 000 000.

The Company has committed over R35,000,000 for local economic development programs alone.

Real Outcomes

In 2003, our South-African subsidiary company, TEM, awarded the first of many bursaries for an Environmental Management degree at the University of South Africa to a local resident of Xolobeni. Today, this very student is a fully qualifiedChief Marine Conservation Inspector and currently employed by the Department of Fisheries and Conservation. This former Xolobeni student is now responsible for patrolling the area, and offering education to various communities on environmental sustainability practices and the increased awareness of native fauna and flora.

In addition through MSR, the company has 10 young people involved in internships training as millwrights, fitters and turners, boilermakers, diesel mechanics and electricians.  Our target is to have 21 interns a year.

At the beginning of 2015, Tormin awarded bursaries to two learners from disadvantaged communities who completed matric with very good grades and who have been at Stellenbosch University one studying B Accounting and another, BSc Chemistry.  Two students from the Eastern Cape received 1 year scholarships for their final year studies in surveying and geology.

 

Community Engagement at Xolobeni

MRC is committed and strives to be a responsible corporate citizen, uplifting and investing our achievements into the local communities around our areas of operation.

Over the period of time from 2002 to 2016, Mineral Commodities have been involved in at least four public participation processes to engage with interested and affected parties in relation to various prospecting right applications and Mining Right Applications. Consultations included the local royal family, the Eastern Cape Cabinet, the district municipality, the local municipality and the local Chamber of Commerce. The consultation was undertaken and a full report submitted to the DMR.

In 2015, the Company facilitated a public participation event, facilitated by an independent company and nominated Environmental Consultant. This provided the perfect opportunity for opponents to voice their concerns and place their comments on record.  The results of this well-advertised process were as follows;

  • 498 comments/issues raised by roughly 200 people

Based on the comments received the following:

  • 77% either fully support the mine or want the mine to build infrastructure (schools, roads, clinics etc) to upgrade the region
  • 10% are against the mine in principle
  • 5% Are undecided or have no opinion
  • 8% Wanted further studies to be done or more information

Accordingly on any statistical evaluation as well as the public participation process that has been conducted, the majority of the population supports the mining project, or at least wishes it to be assessed. 

Whilst the most recent official engagement, the 2015 efforts were not the first.

Since 2002, the Company has been involved in at least four public participation processes that engaged with interested and affected parties in relation to various prospecting right applications and Mining Right Applications. Consultations included the local royal family, the Eastern Cape Cabinet, the district municipality, the local municipality and the local Chamber of Commerce. For each consultation undertaken, a full report submitted to the DMR.

Company response to recent violence in Xolobeni

The Company would like to formally reiterate that we are not in a position to comment with any authority on the recent incident involving Mr Rhadebe’s death. This is a matter for the police, and we extend our condolences to the Rhadebe family on this sad occasion.

Mr Rhadebe was known to the Company because of his appointment in the Amadiba Community Steering Committee, a committee set up as a Company initiative to assist in the peaceful oversight of environmental site visits for our Xolobeni tenement. We appreciate Mr. Rhadebe’s efforts to date and send our sincere consiliences to his family.

In light of the recent media narrative that has surrounded the Company in recent weeks, the Company has felt it necessary to present a formal statement that directly confronts any insinuation that the Company was in anyway involved or associated with the murder of Mr Rhadebe or any ongoing violence within the Xolobeni community.

The Company, under no circumstances has, or ever will condone violence in any form. The company is in no way implicated in any form whatsoever in this specific incident. The Company defends its brand, integrity and the social capital our team has worked tirelessly to build over the past thirteen years. Mineral Commodities Ltd does not engage in any activity that incites violence and has gone so far as to stop legitimate operations to defuse and mitigate any risk violence to its workforce or local inhabitants of threats of violence.

For the purposes of this statement, we feel it is a valuable opportunity to provide the public context to the recent violence in Xolobeni.

For the purposes of this statement, we feel it is a valuable opportunity to provide the public context to the recent violence in Xolobeni.

Background

In July 2015, the Company took the initiative reached out to the Amadiba Crisis Committee (ACC) and the Amadiba Community with the aim to form a Steering Committee.

The intention of the Steering Committee was to oversee peaceful access to the Xolobeni tenement site for representatives of the Company and the environmental consultants who have been engaged to assess any possible the environmental impacts of the proposed mining operations. This is a legal right afforded to the Company, and in accordance with Environmental Impact Assessment process we are currently attempting to navigate.

As previously mentioned, Mr ‘Bazooka’ Rhadebe was a member of this committee, as one of the nine members appointed by the ACC and the Amadiba Community . The Steering Committee were due to meet on a regular basis to manage all matters concerning to the current Environmental Impact Assessment.

The Company will not be leveraged into preferential treatment in terms of commercial contracts and financial demands by the ACC or by any group to win their support for the project, regardless of the consequences or delay to the progress of the at Xolobeni.

As such, these circumstances led to the unfortunate disbanding of the Steering Committee.

Despite what intentions or agenda the Company has been accused of having by external parties with questionable agendas, the Company firmly believes in the social, economical and future benefit that the mineral sands mining operation that we are proposing will bring to the community of Xolobeni. For fourteen years our Company has worked with and amongst the people of Xolobeni, a community where 27 percent have no formal education, and 88 percent are unemployed (Pillay 2015). Over this time we have witnessed the many promises that have been made to these people for eco-tourism, and better options that mining, and have been saddened that nothing has ever come of these promises, leaving the community members behind the national average in term of upliftment, education and economic opportunities.

With this in mind, we continue to search for peaceful alternatives that will allow us to engage with the community, and provide safe access to carry out the environmental impact assessment. In 2015 the Company undertook a public participation process, this time run by an independent company as part of the EIA. This initiative has offered the Xolobeni community the perfect opportunity to voice their concerns and place their comments on record.

For the record, what this most recent community engagement tactic has uncovered is;

  • Confirmation of the number of community members engaged in this consultation process so far is roughly 200.
  • 77% of participants either fully support the mine or want the mine to build infrastructure (schools, roads, clinics etc.) to upgrade the region
  • 10% Are against the mine on principle
  • 5% Are undecided or have no opinion
  • 8% Wanted further studies to be done or more information
  • A database of 498 comments/issues/questions raised and discussed since 2015.

Thus any statistical evaluation of the public participation process concludes the majority of the population supports the mining project, or at least wishes it to be assessed.

It is important to understand that the local Amadiba population totals some 10,000. In addition, the number of people surrounding the mining lease (not living on it or on the area of mining) is roughly 4,000. These individuals are approximately 3-5km away from the proposed mining area.

In 2003, when the initial studies started, there were 11 families, who were previously living directly in/on the proposed mining area. It has recently been noted that these people have subsequently moved inland due to the fact that the area is isolated away from all basic infrastructure that exists in the area.

The company respects that whilst it has legal tenure to conduct various studies under its mining rights application, no piece of paper issued by a Government regulator derogates the requirement of an approved social licence to operate. Without a healthy engagement and presence in the community, we are unable to effectively manage economic, environmental and social expectations.

The Company accepts that some environmental social impacts are not acceptable to stakeholders, and that uncertainty through vague or limited information about the project exists. It also accepts that some people will be ideologically opposed.

In the interim, it continues to advocate to work to negotiate a peaceful site access to complete its environmental impact assessment studies so that we can provide the local community with the necessary information they need to adequately assess for themselves the benefits of future mining operations in Xolobeni.

The Company will continue to actively seek to engage with all interest and affected parties (IAP) members of the local community of Xolobeni.

In the interim, it continues to advocate to work to negotiate a peaceful site access to complete its environmental impact assessment studies so that we can provide the local community with the necessary information they need to adequately assess for themselves the benefits of future mining operations in Xolobeni.

For more information contact

Mineral Commodities
Media & PR : Anne Dunn
E: anne.dunn@vodamail.co.za
P: 082 448 2684

Xolobeni children going to School in Style

Mineral Commodities understands that the provision of quality education to learners is a national priority. The Company is currently involved with several initiatives designed to improve the quality of education at various schools surrounding the mining areas.

In an effort to ensure schooling is made more accessible, it is important that an effort is made in the reduction of school fees and other costs associated costs (source).  The World Bank (2004) argued that user fees are a major obstacle to universal education in developing countries. Several countries in sub-Saharan Africa have eliminated school fees, but other significant costs remain, including the cost of providing a school uniform for a child.

Results from research conducted on the impact of school uniforms in education indicate a strong positive impact of receiving a school uniform on student school participation. Giving a uniform reduces school absenteeism by 6.4 percentage points (43%) from a base of 15% school absenteeism. The effect is 3.4 percentage points larger for students who did not have a uniform at the baseline. This is a major reduction in absenteeism from a baseline school attendance level of 85%.

Having access to a school uniform appears to have positive impacts on test scores, even raising average test-scores of recipients by one quarter of a standard deviation. The average effect of the research program was an increase in school participation of 0.064 years per treated child. The average cost of a school uniform is 436.86 Kenyan shillings (US$5.82). Thus, the cost of increasing school by one year is $5.82 / 0.064, or US$90.94.

In mid 2015, the Company became aware that the local Xolobeni children were unable to access quality school uniforms, and as such, made the decision to invest additional Company funds to ensure that the school children were provided a school uniforms. Mineral Commodities provided uniforms for the following schools Xolobeni Junior School, Khumbuza Junior school, Jama Junior School, Cangci High school, Baleni High school, Sigidi High school , Sijadu Primary school and Phandulwazi Junior school.

Xolobeni and the Environment

Sustainability and the environment are fundamentally important to Mineral Commodities.

The Company believes that it’s possible for responsible mining development to co-exist with environmental, social, and cultural purviews and this is what results in sustainable economic development.

Before operational strategies are conceived, the full scale environmental impacts must be known. Mineral Commodities believe we must first fully understand any potential environmental impacts that mining might have on the areas we lease. In order to become fully informed of such impacts, we must engage an independent environmental consultant to carry out an Environmental Impact Assessment (EIA). The EIA forms an important part of the Company’s Mining Right Application, and is a critical piece of information for the local community. Access to the EIA results in informed, educated and empowered local residents, as it provides them with a complete picture needed when making decisions on the merits of the proposed project going forward. Blocking this site access ultimately results in robbing the local residents of their right to make informed decisions on their future, and the future of generations to come.

There are proper due processes, such as that of an EIA, allow a balanced assessment of not only all environmental and social aspects considered, but also to engage all interested and affected parties and record and process all comments and concerns made in any application. The Company is currently following all the relevant regulatory steps in it’s application.

Xolobeni EIA Status

A Mining Right Application was made in March 2015, which was followed by the commencement of a full EIA in June 2015. However, violence and intimidation prevented our independent consultants from accessing the area, and to date the Company has not been able to move forward with the important environmental assessment.

However, the Company has conducted exhaustive specialist studies and stakeholder engagement reports conducted as part of the historical and current EIA process. To find out more about community engagement in Xolobeni click here.

Proposed Mining Area

The proposed tenement area at Xolobeni is approximately 22 kilometers long and roughly 1.5 kilometers wide and covers some 2800 hectares. The project mining resource area encompasses five distinct areas, the: Mtentu, Sikombe, Kwanyana, Mnyameni, and Mpahlane.

It is estimated that only 885 hectares of land (32% of tenement) in total will be disturbed  by the construction and operation of the new mine, and its associated infrastructure. However, it is important to note that most of the mining occurs on the Kwanyana block which is 300 hectares in size and only an average of 38 hectares will be disturbed per year, in an area, which has been environmentally degraded by over-farming and the removal of all vegetation. Of this secondary dunal system, if not rehabilitated, will ultimately continue to choke the river and estuary system as it erodes unabated.

The Company originally, and on a voluntarily basis, took significant steps to excise large parts of sensitive environmental estuarine areas as well as other environmentally and culturally sensitive locations, from the proposed mining area, in it’s Mining Right Application. This includes the primary frontal coastal dune system in its entirety, and addition of large buffer areas between the mining zones and the estuaries as well as the frontal dune system.

The Xolobeni mining lease area does not impeach pristine coastal dunes nor waterfalls.  Rather it deals with the mining of a denuded secondary sand dune system (see Figure 2 below) away from the coast, which is mobile and currently shows significant natural erosion.

xolobeni sand dune

The environmental degradation has been caused by over farming and removal of all vegetation. Of this secondary dunal system, if not rehabilitated, this will ultimately continue to choke the river and estuary system as it erodes unabated.

The rehabilitation of the land post mining will leave the land reshaped for arable farming use.

 

South Africa is emerging from a serious drought which has spotlighted our reliance on remaining clean freshwater sources.

The Company fully appreciated the significance of clean water to South Africa, especially that of rural communities such as Xolobeni.

Mineral Commodities planned to launch an initiative in February 2016 to address this situation for the residents of Xolobeni. The Company planned to undertake a water drilling programme in, which would have left 3 fully equipped boreholes with fresh drinkable water for the community.  Unfortunately, due to persisting threats of violence, we were prevented from doing this and rather than inflame the situation chose to stop the programme.

In addition, in terms of water usage, Mineral Commodities intention is to use dry mining techniques, which do not encompass dredging or require large amounts of water. Dry mining will allow a small spatial footprint to be open and progressively closed and rehabilitated as the mining path progresses. Saltwater will be used for its processing and in addition, desalination will also be used for the final processing of the product into finish ilmenite, zircon, rutile products.

Mineral Commodities remain committed to minimising environmental impacts, and maximising sustainability initiatives in all areas of our company operations.

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