According to Corpus Legal Practitioners, there is a range of requirements that needs to be taken into account when you apply for a mining licence in Zambia, as gold detector distributors in Zambia, we share an article from Corpus Legal Practitioners in order to give you more insight into your rights and obligations when applying for a mining licence as well as provide you for the contact details for the right people to talk to in order to get started.
What mining rights may private parties acquire? How are these acquired? What obligations does the rights holder have? If exploration or reconnaissance licences are granted, does such tenure give the holder an automatic or preferential right to acquire a mining licence? What are the requirements to convert to a mining licence?
All mining rights are acquired in accordance with the provisions of the Mines Act. Mining rights under the Mines Act consist of a mining or exploration licence. A person may therefore only prospect for minerals or carry on mining operations under the authority of a mining right granted under the Mines Act.
All mining rights are acquired by application to the director of mines cadastre by submitting a prescribed form and paying the prescribed fee by either an individual or a company. Mining rights are granted on a first-come, first-served basis by either the director of mines or the director of the geological survey, where the application meets the requirements of the Mines Act.
The following mining rights may be acquired: an exploration licence and a mining licence. The Mines Act also provides for non-mining rights, which are a mineral processing licence, mineral trading permit, mineral import permit, mineral export permit and a gold panning certificate.
The Mines Act confers obligations on specific licence holders, as follows.
The area of land over which an application for an exploration licence is made should be represented by complete and specific cadastre units. The minimum size of a small-scale exploration area is three cadastre units (approximately 0.1 square kilometres) and this cannot exceed 300 cadastre units (approximately 10.2 square kilometres). For large-scale exploration, the minimum area of exploration is 300 cadastre units (approximately 10.2 square kilometres), while the maximum area must not exceed 59,880 cadastre units (approximately 1,999 square kilometres).
A holder of an exploration licence (ie, a company and its subsidiaries) may not hold a number of licences whose accumulated total area is more than 299,400 cadastre units (approximately 9,999 square kilometres). A company that accumulates an exploration area in excess of 149,700 cadastre units (approximately 4,999 square kilometres) must pay prescribed additional fees.
Exploration licences are valid for a period of four years and can be renewed for two further periods of three years each. The maximum period of an initial exploration licence is 10 years.
The holder of an exploration licence has the following obligations:
- commence exploration operations, only once a decision letter (written approval) in respect of the environmental project brief approved by the ZEMA has been submitted to the mining cadastre office;
- register a pegging certificate within 180 days of acquiring or being granted the exploration licence;
- expend on exploration operations not less than the amount prescribed or required by the terms of the licence to be so expended;
- carry on exploration operations in accordance with the programme of exploration operations;
- notify the director of the mining cadastre of the discovery of the mineral to which the exploration licence relates within a period of 30 days of such discovery;
- backfill or otherwise make safe any excavation made during the course of the exploration operations, as the director of the mining cadastre may specify;
- permanently preserve and safeguard any borehole in a manner directed by the director, and to surrender to the government without compensation, the drill cores, mineral samples, the boreholes and any water rights in respect, therefore, on termination;
- unless the director stipulates otherwise, to remove within 60 days of the expiry of the exploration licence, any camp, temporary buildings or machinery installed or erected, or make good any damage occasioned to the ground on account of such removal; and
- maintain full and accurate records of the exploration operations and submit them quarterly to the Ministry, indicating:
- the boreholes drilled;
- the strata penetrated;
- the minerals discovered;
- the results of any seismic survey or geochemical, geophysical and remote sensing data analysis;
- the result of any analysis or identification of minerals removed from the exploration area;
- the geological interpretations of records maintained on the above matters;
- the number of persons employed;
- any other exploration work;
- the costs incurred;
- such other matters as may be prescribed by the minister in a statutory instrument; and
- furnish the directors, at least every quarter, with digital and hard copies of the records.
A mining licence applies to anyone intending to carry on any artisanal, small or large-scale mining. An application for a mining licence is made to the director of the mining cadastre in a prescribed manner and form and upon payment of a prescribed fee. The period for which a mining licence is granted depends on the category or class of mining to be undertaken. These are as follows:
- two years for artisanal mining;
- 10 years for small-scale mining; and
- 25 years for large-scale mining.
Artisanal mining may only be undertaken by Zambian citizens or cooperatives wholly composed of Zambian citizens. Small-scale mining may only be undertaken by citizen-owned, citizen-influenced or citizen-empowered companies. A citizen-owned company (COC) is one where 50.1 per cent of its equity is owned by citizens and in which the citizens have control of the management of the company. A citizen-influenced company (CIC) is one where 5-25 per cent of its equity is owned by citizens who also have significant control of the management of the company and a citizen-empowered company (CEC) is one where 25-50 per cent of its equity is owned by citizens.
The Mines Act confers the following obligations on holders of mining licences:
- register a pegging certificate within 180 days of being granted the mining licence;
- develop the mining area and carry on mining operations with due diligence and in compliance with the programme of mining operations and the environmental impact assessment (EIA);
- take all measures on or under the surface to mine the mineral to which the licence refers;
- with respect to large-scale mining, implement the local business undertaking attached to the mining licence as well as employ and train Zambian citizens in accordance with the proposal attached to the licence;
- comply with the proposed forecast of capital investment;
- permit inspection of the books and records maintained by an authorised officer;
- submit to the director of mining cadastre reports, records and other information that may be required;
- maintain accurate technical records of the mining area, copies of all geological reports, accurate and systemic financial records and books of accounts of the mining operations under the licence and operations not related to the mining licence;
- submit financial year-end reports and in the case of large-scale mining returns showing compliance with the obligations specified;
- maintain the security of the licensee’s tenements;
- submit annual mine plans, sections, primary and secondary developments, ore recovery and treatment and production costs to the demarcate of the mining area in a prescribed manner; and
- maintain complete and accurate technical records of the operations in the mining area with copies of all maps and geological reports.
The holder of an exploration licence has a preferential but not an automatic right to acquire a subsequent mining right. The Mines Act gives the holder of an exploration licence the opportunity to apply for a mining licence within the exploration area. Such application should be made to the director of mines in the prescribed form and upon payment of a prescribed fee. It appears that the conversion of an exploration licence to a mining licence would be achieved through making an application for such a mining licence within six months before the expiry of the exploration licence.
An application for a mining licence must include the following to be accepted:
- a statement of the period for which the licence is sought;
- a statement of the minerals to be mined under the licence;
- a comprehensive statement of the mineral deposits in the area over which the licence is sought, including details of all known minerals proved, estimated or inferred, ore reserves and mining conditions;
- the proposed programme for mining operations, including a forecast of capital investment, the estimated recovery rate of ore and mineral products, and the proposed treatment and disposal of ore and minerals recovered;
- an environmental management plan, including proposals for the prevention of pollution, the treatment of waste, the protection and reclamation of land and water resources, and for eliminating or minimising the adverse effects on the environment of mining operations;
- details of expected infrastructure requirements;
- the applicant’s proposal with respect to the employment and training of citizens of Zambia;
- the applicant’s proposals for the promotion of local business development outlining how the applicant intends to promote;
- the participation of Zambian entrepreneurs in procurement and supply business opportunities with the applicant;
- the setting up by Zambian entrepreneurs of import substitution, and repair and maintenance businesses locally;
- the partnership between the Zambian entrepreneurs and foreign suppliers and contractors;
- skills development to enable the Zambian entrepreneurs to attain quality standards in contract works and supply;
- a full description, with geographical coordinates, of the area of land for which the mining licence is sought (not exceeding 7,470 cadastre units (approximately 249.498km2), represented by complete and not partial cadastre units;
- a tax clearance certificate issued under the Income Tax Act;
- a plan of the proposed mining area prepared in such manner and showing such particulars as the director of mines may require; and
- such further information as the director of the geological survey may require for the disposal of the application.
In addition to the above, the Mines Act also requires an applicant to commission and produce for the director of mines an environmental impact study on the proposed mining operations approved by the ZEMA.
Further, the holder of a small-scale prospecting permit may at any time during the currency of the permit application to the director for a small-scale mining licence over any part of the prospecting area in the prescribed manner and upon payment of the prescribed fee.
An application for such a licence would include the following:
- an identification of the relevant prospecting permit;
- a description and sketch of the area of land, not exceeding 180 cadastre units over which the small-scale mining licence is sought, sufficient to enable identification of the area;
- a description of the proposed programme of mining operations, which shall include a forecast of investment, the estimated recovery rate of ore and the applicant’s proposal for its treatment and disposal;
- a description to the best of the applicant’s knowledge and belief of the mineral deposits in the area over which the licence is sought;
- a statement of the duration, not exceeding 10 years, for which the small-scale mining licence is sought;
- a tax clearance certificate under the Income Tax Act; and
- such other information as the director may require for the disposal of the application.
Mineral processing licence
The holder of a mineral processing licence is granted exclusive rights to carry on mineral processing in the mineral processing area specified in the licence. The following obligations are attached to a mineral processing licence:
- to commence mineral processing operations once approval has been granted by the Zambia Environmental Agency in respect of the EIA;
- to carry on mineral processing operations in accordance with the approved programme of mineral processing operations;
- to submit reports to the directors on sources of ore, concentrates, tailings, slimes, quantities and grade feed;
- to provide the directors with reports on compliance with safety and environmental standards, as well as labour and production returns; and
- to submit any other records, reports and other information that the directors may require concerning the operations of mineral processing.
Gold panning certificate
The holder of a gold panning certificate is granted exclusive rights to pan for gold over specified areas along with water courses and bodies but is prohibited from excavating. Gold panning certificates are valid for a period of two years and confer the following obligations on a holder:
- maintaining accurate and separate production and sales registers;
- keeping daily records of production and sales, indicating names of buyers, permit numbers, amount and value of gold sold;
- submitting to the director of mines, by the 15th day of each month, true copies of all entries made in the production and sales in the preceding month;
- making the records and minerals available within normal working hours, for inspection by an authorised officer;
- paying mineral royalties in accordance with the Mines Act; and
- maintaining the panning area in accordance with the provisions of the Environmental Management Act of 2011.