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Thursday, 16th February 2006 (3879 views)

A decision by the South African government regarding royalties on mining firms' revenues could be made clearer by August, according to BHP Billiton South Africa chairman Vincent Maphai.

Under the Minerals and Petroleum Royalty Bill mining companies operating in South Africa could be required to pay a three per cent duty on gold and eight per cent on diamonds.

No mention was made of the bill in the national budget, which was unveiled on February 15th.

However, the chairman of mining giant BHP Billiton said that "it is not improbable that the bill may be referred in June, July or August. It will be much clearer than it is now".

The uncertainty has made BHP Billiton jittery. Last week the firm decided to postpone a large drilling project west of Saldanha Bay, claiming that it needed more fiscal details before it could proceed.

South Africa mineral and energy minister Lindiwe Hendricks conceded that the situation was unfortunate, but said that the government would not be rushed into passing legislation.

"There is no way that the national treasury can be pushed to put in place laws because of pressure from one company," he said.

 

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