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Part B: Mineral Rights - Part B-2: Exploration - 25. Exploration Licensing | 25.5 Specific Obligations of a Licence Holder

Provisions that lay out, for the holder of an exploration licence, the necessary responsibility or duty to undertake certain actions or restriction from undertaking certain actions or causing certain effects are collectively treated as obligations. Noncompliance with these obligations may lead to fines and/or ordered suspensions of operations until the licencee is in compliance. Where suspension occurs, continued, uncured non-compliance beyond a specified time period may result in revocation of the licence.

Specific obligations of an exploration licence holder may include obligations before, during and after operations. Obligations prior to the commencement of operations may include: (1) introduction and presentation to local authorities; (2) preparation and regulatory approval of an environmental and social mitigation plan; and (3) establishment of an environmental restoration surety bond or fund.

Obligations during operations may include:

  • Commencement of operations within a specified time period;
  • Posting of an environmental surety;
  • Payment of annual fees per unit of surface area held;
  • Implementation of an approved work program;
  • Filing regular reports on work and investment completed and results achieved (e.g., geological findings);
  • Implementation of approved environmental and social mitigation plan, and filing of periodic reports thereon;
  • Compliance with labor, health and safety regulations;
  • Compliance with applicable immigration, customs and tax laws and regulations;
  • Compliance with all applicable contract terms, in countries where a contract between the State and each exploration licence holder is required.

Obligations upon the closure of operations normally include a final report of work carried out and results achieved, as well as the implementation of the site closure and restoration provisions of the approved environmental impact mitigation plan, unless the site is to be developed as a mine.

25.5 Example 1:

Article [_]: Obligations for maintaining the validity of the right

(1)In order to maintain the validity of their mining or quarrying right, the holder must:

(a) commence work within the period specified in Article [_] of the present [Code][Act][Law];

(b) pay the annual surface area fees per square relating to their title, each year before the deadline set in Article [_] (on the amounts due as annual surface area fees per square) of the present [Code][Act][Law].

(2) Should one or more of these obligations not be fulfilled, the holder shall lose their right in application of the procedure provided for in Articles [_] (on failure to comply with administrative obligations, and the related penalties) of the present [Code][Act][Law].

(3) Should the holder fail to comply with the obligations listed in the following chapters, they shall be subject to fines and/or possibly with an order to suspend operations or, in the case of an offence, shall be prosecuted.

Article [_] The obligation to commence work

A Prospecting Licence holder shall be required to commence work within six months from when the title establishing their right was issued.

Article [_] The obligation to pay the annual surface area fees per square

(1) To cover costs for the services and management relating to the rights established by mining titles, annual surface area fees per square, for each mining or quarrying title which is issued, shall be collected for the Ministry of Mines which shall redistribute a portion to the departments of [the regulatory authority] responsible for the administration of the present [Code][Act][Law].

(2) Holders of Prospecting Licences, Operating Licences, Operating Licences relating to Tailings, Operating Licences for Small-Scale Mining, Permits to Prospect for Quarry Products and Permanent Quarry Operating Permits shall pay the surface area fees for the first year when the mining or quarrying title is issued.

(3) The holder is to settle the annual surface area fees per square for each following year before the end of the first quarter of the calendar year. However, annual surface area fees are to be paid pro rata to the relevant time period, when the initial title is issued, or in the last year during which the title is valid.

(4) Annual surface area fees per square are to be paid at the relevant counter at the Ministry of Mines which issued the mining or quarrying title, which shall issue the holder with a receipt when payment is made.

Article [_] Environmental protection during prospecting

(1) Before prospecting work relating to mining or quarry products may commence, the holder of a Prospecting Licence or a Permit to Prospect for Quarry Products must draw up and obtain approval for an Environmental Management Plan (Plan d’Atténuation et de Réhabilitation (PAR)) for the proposed activities.

(2) The terms of the PAR and its approval shall be laid down in the regulations.

(3) The approval of a PAR shall fall under the jurisdiction of the department responsible for environmental protection within the [the regulatory authority] in collaboration with [the regulatory authority for the environment].

Article [_] Declaration of indicators of an archaeological discovery

Article [_] The discovery of items relevant to the national cultural heritage

Article [_] The jurisdiction of [the regulatory authority]

Article [_] The declaration of an accident in a mine or quarry

Article [_] The use of explosive products

Article [_] The relationship with local authorities

Article [_] Registers and reports

Article [_] Inspections

Article [_] The commencement and closure of a prospecting or operation/s area.


Drawn from DRC’s mining law (2002), this provision deals with obligations in two chapters. Chapter 1 establishes the principle that the holders of all licences must comply with two specific obligations that have specific time requirements in order maintain the validity of their rights:

  • begin work within the time specified in article 197 of the Code; and
  • pay the surface fee per square unit of area related to their title before the deadline set in article 199 of the Code.

Failure to comply with either of these obligations results in the licensee being stripped of the licence.

The licencee’s failure to comply with the obligations listed in the second chapter will be penalized by fines and/or possible orders to suspend operations, or in the case of violations, by judicial process.

This bifurcation of obligations into two categories and the clarity and objectivity of the two obligations that are enforced by revocation of the title provides great security of title to licencees and also ensures prompt and complete payment of the fees that fund the work of the Regulating Authority.

The obligations in the second category are numerous and are only referenced here by article title, except for the obligation to prepare and obtain the approval of an Environmental Mitigation Plan (PAR) before commencing work (which must begin within 6 months of delivery of the licence). The process of approval is expedited by a sectoral environmental review authority.

25.5 Example 2:

Article [_] Legal nature of exploration right, mining right, or production right, and rights of holders thereof

(1) No person may prospect for or remove, mine, conduct, technical co-operation operations, reconnaissance operations, explore for and produce any mineral or petroleum or commence with any work incidental thereto on any area without –

(a) an approved environmental management programme or approved environmental management plan, as the case may be;

(b) a prospecting/reconnaissance permission, exploration right, permission to remove, mining right, mining permit, retention permit, technical co-operation permit, reconnaissance permit, exploration right or production right, as the case may be; and

(c) notifying and consulting with the land owner or lawful occupier of the land in question.

Article [_]. Rights and obligations of holder of exploration right

(1) The holder of an exploration right must –

(a) lodge such right for registration at the Mining Licences Office within 30 days of the date on which the right –

(i) becomes effective in accordance with the provisions of this [Act][Code][Law]; or

(ii) is renewed in accordance with the provisions of this [Act][Code][Law];

(b) commence with exploration activities within 120 days from the date on which the exploration right becomes effective or such an extended period as the [Regulating Authority] may authorise;

(c) continuously and actively conduct exploration operations in accordance with the exploration work programme;

(d) comply with the terms and conditions of the exploration right, relevant provisions of this [Act][Code][Law] and any other relevant law;

(e) comply with the requirements of the approved environmental management programme;

(f) pay the prescribed exploration fees to the State; and

(g) subject to section [_] (on the rules regarding the removal and disposition of minerals), pay the State royalties in respect of any mineral removed and disposed of during the course of exploration operations.

Article [_]. Permission to remove and dispose of minerals

(1) Subject to subsection (2), the holder of an exploration right may only remove and dispose for his or her own account any mineral found by such holder in the course of exploration operations conducted pursuant to such exploration right in such quantities as may be required to conduct tests on it or to identify or analyse it.

(2) The holder of an exploration right must obtain the [Regulating Authority]'s written permission to remove and dispose for such holder's own account of bulk samples of any other minerals found by such holder in the course of exploration operations conducted pursuant to such exploration right.

Article [_] Information and data in respect of prospecting/reconnaissance and exploration

(1) The holder of an exploration right or prospecting/reconnaissance permission must –

(a) keep proper records, at the registered office or place of business, of exploration operations and the results and expenditure connected therewith, as well as borehole core data and core-log data, where appropriate; and

(b) submit progress reports and data, in the prescribed manner and at the prescribed intervals, to the [Regulating Authority] regarding the exploration operations.

(2) No person may dispose of or destroy any record, borehole core data or core-log data contemplated in subsection (1)(a) except in accordance with written directions of the relevant [Officer of the Regulating Authority].

Article [_] Environmental management principles

(1) The principles set out in section [_] of the [National environmental legislation ] –

(a) apply to all exploration and mining operations, as the case may be, and any matter or activity relating to such operation; and

(b) serve as guidelines for the interpretation, administration and implementation of the environmental requirements of this [Act][Code][Law].

(2) Any exploration or mining operation must be conducted in accordance with generally accepted principles of sustainable development by integrating social, economic and environmental factors into the planning and implementation of exploration and mining projects in order to ensure that exploitation of mineral resources serves present and future generations.

Article [_] Integrated environmental management and responsibility to remedy

(1) The holder of a reconnaissance permission, exploration right, mining right, mining permit or retention permit –

(a) must at all times give effect to the general objectives of integrated environmental management laid down in the [relevant environmental legislation];

(b) must consider, investigate, assess and communicate the impact of his or her exploration or mining on the environment as contemplated in the [relevant environmental legislation];

(c) must manage all environmental impacts –

(i) in accordance with his or her environmental management plan or approved environmental management programme, where appropriate; and

(ii) as an integral part of the prospecting/reconnaissance, exploration or mining operation, unless the [Regulating Authority] directs otherwise;

(d) must as far as it is reasonably practicable, rehabilitate the environment affected by the exploration or mining operations to its natural or predetermined state or to a land use which conforms to the generally accepted principle of sustainable development; and

(e) is responsible for any environmental damage, pollution or ecological degradation as a result of his or her prospecting/reconnaissance, exploration or mining operations and which may occur inside and outside the boundaries of the area to which such right, permit or permission relates.

(2) Notwithstanding the [Companies Act], or the [other relevant legislation], the directors of a company or members of a close corporation are jointly and severally liable for any unacceptable negative impact on the environment, including damage, degradation or pollution.

Article [_] Financial provision for remediation of environmental damage

(1) The holder of an exploration right, mining right or mining permit must annually assess his or her environmental liability and increase his or her financial provision to the satisfaction of the [Regulating Authority].

(2) If the [Regulating Authority] is not satisfied with the assessment and financial provision contemplated in this section, the [Regulating Authority] may appoint an independent assessor to rehabilitate the closed mining or exploration operation in respect of latent or residual environmental impacts.


Drawn from South Africa’s mining law (2002), this provision requires (for exploration licences called prospecting permits) compliance with all of the obligations noted above and also:

  • Approval of an environmental management plan (as part of the licence grant process);
  • Notification and consultation with the landowner or lawful occupier;
  • Presentation of the licence to the Mining Licences office for registration;
  • Commencement of exploration (called prospecting) activities within 120 days of the effective date of the licence;
  • Maintenance of records, drilling logs, etc.; and
  • Obtaining the [Regulating Authority]’s approval for any removal of bulk samples for testing.

This is a clear and comprehensive set of specific obligations of exploration licence holders.