Giving up the Ghost Town: A Comparative Evaluation of Mine Closure Legislation in South Africa

Abstract

Johannesburg is a town built on gold. The discovery of gold on the Witwatersrand Basin in 1886 turned agricultural land into a mine town. Today, that mine town is a supercity. The city’s reliance on gold and the industry’s historical role as a major employer is referenced in its Zulu name: eGoli, the Place of Gold. The gold mining industry in South Africa is in decline. Mine closure has a wide range of impacts on mine town residents; mines often function as the local utility provider, landlord, and sheriff in addition to their primary roles as employers. In 2002, South Africa passed new legislation, the Minerals and Petroleum Resources Development Act, aimed at spreading some of the wealth accumulated by mining into local communities. The most famous element of the legislation focused on economic uplift by issuing racial quotas for hiring and shareholding. This thesis focuses on a less discussed but still crucial element of the MPRDA: its provisions to encourage responsible mine closure. This thesis compares two mines: Durban Deep and Blyvooruitzicht. The mines are located about 60 km from each other in Gauteng Province and both operated for at least 70 years. At one point, Blyvooruitzicht was the biggest producer of gold in the world and at its peak Durban Deep employed over 18,000 people. The key point of divergence in this comparison is their moment of closure. Durban Deep closed in 2000, well before the 2004 implementation of the MPRDA, while Blyvooruitzicht closed in 2013. The central question is whether the provisions of the MPRDA aimed at environmentally and socially sustainable closure helped to ensure residents of the Blyvooruitzicht mine village a better outcome than their counterparts in Durban Deep. The thesis concludes that the MPRDA did not ensure a better outcome for the Blyvooruitzicht residents. Following closure, they dealt with the same issues of increased crime, increased poverty, unstable service provision, uncertain tenancy, and environmental damage as the Durban Deep residents weathered ten years prior. Even more worrisome, interviews and newspaper articles about Durban Deep indicate that the community has not recovered from the mine’s closure, even though twenty years have passed. The primary reason for the MPRDA’s failure in Blyvooruitzicht is simple: it was never implemented fully. The thesis outlines the key reasons for the failure of implementation in Blyvooruitzicht and demonstrates the implications of these failures to the broader industry. The key issues of implementation implicated in this thesis are as follows. First, mine transfers at the end of a mine’s profitability often leave under-resourced companies with full environmental liability. Second, liquidation law did not align with the MPRDA’s provisions, so liquidators were left with no guidance about what to do with the rehabilitation funds or how to order environmental liabilities with debts to creditors. Third, bureaucratic delays exacerbated uncertainty and left mine towns in the lurch. I hope that better awareness of the implementation failures of past mining legislation may improve the likelihood of future success, especially as South Africa is in the process of implementing its new One Environment framework. Progressive legislation cannot exist on paper alone. Its success depends on the ability of companies and government agencies alike to share an interpretation of the legislation and shoulder their respective responsibilities.