Q&A’s, 2007

NATIONAL ASSEMBLY
Question for Written Reply
IQP: 36 -2007

Question 1581

Dr SM van Dyk (DA) to ask the Minister for Public Enterprises:

(1) Whether the agreement with the Richtersveld community is in the public interest; if so, (a) what does the agreement entail, (b) why have the details not been made public and (c) why does the Government not finalise the negotiations with a public meeting of agreement at which the whole community and government representatives are present;

(2) whether certain members of the community’s negotiating team have received or been promised any privileges or other forms of benefit; if not, what is the position in this regard; if so, what are the relevant details;

(3) whether Alexkor and the farm land in question has in the mean time deteriorated and gone into decline: if not, what is the position in this regard; if so, what are the relevant details? NW2395E

Reply

(1) (a) The Settlement constitutes the conclusion of a protracted Court case. It will enable the community to exercise their rights as landowners with respect to future land mining and creates a basis for further economic development for the Richtersveld community. The Deed of Settlement signed on 22 April 2007 was confirmed by the Land Claims Court on 9 October 2007. In making it an order of court, the Court expressed satisfaction that the Deed of Settlement was clear and enforceable, that it was properly executed, that it was not against public policy and that the prescripts of the Restitution of Land Rights Act, 1994 were met by the settlement agreement.

The Settlement entails the following:

• Restoration of the land claimed. Portions of land will be transferred to the community by Alexkor and the State;
• Restoration of the mineral rights by way of transfer of Alexkor’s land mining rights to the community’s mining company. In the medium term, Alexkor will pool its sea mining resources with the land mining resources of the community in the form of a Pooling and Sharing Joint Venture (PSJV);
• Transfer of Alexkor’s agricultural and mariculture assets to the community in order to empower the community and to create a basis for future development and wealth creation;
• R190 million as extraordinary reparation to be paid to the community’s Investment Holding Company in three equal instalments over three years;
• R50 million development grant to the community’s Investment Holding Company to be used for the recapitalisation of the agricultural and maricultural enterprises;
  Establishment of a formal township at Alexander Bay; and
• Environmental rehabilitation and revision of the mine’s Environmental Management Programme.

(b) Details of the agreement have been publicised. Avenues utilised to publicise details of the Deed of Settlement since it was signed on 22 April 2007 include:

• Press release in English and Afrikaans to the print and broadcast media on 22 April 2007;
• Booklets on the settlement agreement in Afrikaans and Nama were distributed to the Richtersveld community and relevant stakeholders;
• The settlement agreement was included in the Minister’s Budget Vote on 18 May 2007;
  Press release to all print and broadcast media on the first steps of the implementation of the settlement agreement on 12 June 2007;
• Press release to all media on the Deed of Settlement being made an order of court by the Land Claims Court on 9 October 2007;
• Advertisement placed in the Mail & Guardian, City Press, Die Gemsbok, Diamond Fields Advertiser and Sunday Independent on 12 October 2007.

(c) The settlement agreement was negotiated by the Minister of Public Enterprises and representatives of the Richtersveld Community and the Richtersveld Sida, Hub Communal Property Association as Principals in the process. The Community held a meeting at Leekersig on 4 August 2007 at which details of the Deed of Settlement were discussed and the Community endorsed settlement agreement.

(2) No privileges or benefits were offered to or promised to the community’s negotiating team.

(3) Alexkor’s operations have been constrained by several factors. This led to the company operating at a loss with resultant erosion of equity. This decline in financial performance can be attributed to a decrease in mining production, particularly from land, as well as losses incurred from Alexander Bay Trading (non core) activities. Over the last few years, Alexkor developed strategies to return the company to profitability. The protracted litigation and negotiations in the Richtersveld land claim compounded the situation as land operations were hampered largely due to the uncertainties regarding the outcome of the legal proceedings. Long term business plans with associated recapitalisation could not be implemented as the Richtersveld community interdicted some of the company’s initiatives to turn around.