THE tiny Province of Renbel is in the news of late.
Its rich bauxite deposit in West Rennell is at the centre of attention as potential developers/investors flexed their financial muscles to see who gets the prize.
In the end, the public was told that an Indonesian company was granted a Mining Licence to develop the project, despite strong objections by landowners.
Not only did the landowners object, Ministry officials dealing with the application jumped the queue in fast tracking the approval.
There was even a denial by the Minerals Board that it had approved the new comer.
Social media network, Forum Solomon Islands International (FSII), was inundated with all sorts of information regarding the matter.
Getting a Mining Licence is a laborious process. Here’s what I do know about it.
In normal situation, the application is quite straightforward. In the first instance, for example, an interested party puts in a formal application for a Prospecting Licence, indicating his area of interest.
The application is addressed to the Director of Mines, who then acknowledges in writing its receipt.
The next step is for the Board Secretary to write, advising the applicant that his company’s application has been received.
Such a letter usually conveys the information that the applicant would be notified once a date for the next Board meeting is confirmed.
A company representative usuallyattends just in case the Board has matters to clarify in relation to the application.
One other point to remember is that the Ministry of Mines, Energy and Rural Electrification is not allowed by law to accept any application for an area that it knows is still under someone else’s name.
On the other hand once approval has been granted, the applicant is notified, along with the Minister of Mines, who in turn issues the Prospecting Licence.
An applicant is usually given 12 months or more to satisfy itself that the deposit is sufficient to proceed to the next stage, which is mining.
In the intervening period, the company is allowed to land machineries and equipment on site to enable it to carry out its own tests so that it is satisfied the size of the deposit is economically viable to proceed with mining.
Again, if the company decides to proceed to mining, a formal application has to be madeto the Minerals Board, via the Director, informing that the company is satisfied with the results of its work and now wishes to proceed to the next level (mining).
This is the critical time for top level negotiations for a Mining Agreement.
This agreement usually consists of a Heads of Agreement as well as subsidiary agreements mutually binding on stakeholders, that is to say the National Government, Provincial Government, Resourceowners and the investor.
Such negotiations can take up to a year or more.
The Mining Agreement covers issues and areas covered in the preceding negotiations. Then and only then can a Mining Licence be issued.
Unfortunately that was not the case with the Indonesian company in recent weeks.
First, the company never undertook any exploratory work on the island of Rennell.
Secondly, you can never apply for a Mining Licence without first obtaining a Prospecting Licence, something the Indonesian company reportedly never did.
So, why the hurry in an election year? Is it part of the fundraising drive for the election?
If so, then it seems to align well with reports making the rounds in Honiara that certain individual has received USD3 million (about SBD21 million) in return for pushing the application through.
As well, rumour has it that the same company spent something in the order of SBD$12 million in the last three months to grease the palms of officials so that the process is fast tracked for the Mining Licence to be issued.
Given that the landowners have threatened taking out a caveat over the area, one wonders whether it was money well spent.
Worst still if some of these individuals were never voted back in the November election.
By Alfred Sasako