Mining Tenders 2025: DMRE Compliance & Social Labour Plans

The Dual Economy of Mining in South Africa

The South African mining sector is the bedrock of the national economy, contributing roughly 8% to GDP and employing close to half a million people directly. However, for a tenderer or service provider, it operates in two distinct, widely divergent regulatory spheres. Understanding which sphere you are targeting is the first step to compliance, and failing to distinguish between the two is a common reason for business failure in this sector.

On one side is the State, represented primarily by the Department of Mineral Resources and Energy (DMRE). The State does not own the mines (mostly), but it acts as the custodian of all mineral rights. Tenders issued by the DMRE or State-Owned Entities (like the Council for Geoscience, Mintek, or the State Diamond Trader) are governed strictly by the PFMA (Public Finance Management Act). These tenders are generally for professional services like geological mapping, policy research, legal drafting, or mine rehabilitation oversight.

On the other side is the Private Sector—the mining majors like Anglo American, Exxaro, Sasol, Glencore, and Sibanye-Stillwater. While private, they are heavily regulated by the State. They issue supply chain tenders for everything from heavy earthmoving equipment to catering and security. Their procurement behavior is driven by the Mining Charter III, which sets aggressive targets for 'Inclusive Procurement'. You generally cannot win a contract with a Mining Major unless you are a B-BBEE Compliant entity, preferably with 51% Black Ownership. They are not looking for the cheapest price; they are looking for the 'Most Compliant' partner to protect their Mining Right.

The Gatekeeper: DMRE and SAMRAD

Whether you want to be a primary miner (digging the hole) or a contractor, the DMRE is your starting point. You cannot legally move a single kilogram of earth without a permit. In the past, this was a manual, paper-based nightmare of lost files and corruption. Today, it is a digital process, although not without its own challenges.

The SAMRAD System

The South African Mineral Resources Administration System (SAMRAD) is the online portal where all applications must be lodged. It is the only legal channel. No paper applications are accepted at Regional Offices anymore. The system is designed to provide transparency on who owns what land.

Critical Warning: The system often experiences downtime or lag. Do not leave your application for the last day of a window. The server often crashes when heavy traffic hits. Screen-grab every step of your submission as proof of attempt in case of a system failure dispute. You must have your coordinate shapefiles (GIS data) ready in the exact format required, or the upload will fail.

Legislative Compliance: The 'Big Three' Acts

Your tender submission for any mining-related work must demonstrate knowledge of these three pieces of legislation. Ignorance of the law is not an excuse in this high-risk industry.

• MPRDA (Mineral and Petroleum Resources Development Act): Section 22 governs the application for mining rights. Section 102 governs the amendment of rights (e.g., if you want to add a new mineral to your license). This is the 'constitution' of mining.
• NEMA (National Environmental Management Act): The 'One Environmental System' means that the DMRE now issues environmental authorizations, but they follow NEMA rules. You must have an Environmental Authorization (EA) before you touch the ground. Penalties for mining without an EA can include imprisonment.
• MHSA (Mine Health and Safety Act): This is the most critical operational act. It places 'Strict Liability' on the employer. If a worker dies, the CEO can go to jail. Tenders will demand proof of your safety systems.

The Social and Labour Plan (SLP): Your License to Operate

The SLP is the document that most often causes tender/license rejection. It is your binding contract with the community. It is not a wish list; it is a budget commitment mandated by Regulation 46 of the MPRDA.

Core Components of a Compliant SLP

A standard SLP must tackle three pillars:

1. Human Resource Development (HRD): You must commit a percentage of your payroll (usually 5%+) to training. This isn't just safety training; it is 'Portable Skills Training'. You must train workers in skills they can use after the mine closes (e.g., plumbing, welding, farming). You must submit a Workplace Skills Plan (WSP) to the MQA (Mining Qualifications Authority).
2. Local Economic Development (LED): You must fund a project in the Labour Sending Area. Crucial: This project must be approved by the Local Municipality and appear in their Integrated Development Plan (IDP). You cannot just decide to build a crèche because it looks nice. If the Municipality didn't ask for a crèche, the DMRE will reject your SLP. You need a letter of support from the Municipal Manager.
3. Housing and Living Conditions: The 'Hostel System' is illegal. You must provide decent family units or a 'Living Out Allowance' that allows workers to rent decent accommodation. The Mining Charter aims for one person per room.
4. Downscaling and Retrenchment: You must have a plan for what happens when the mine closes (Life of Mine). How will you cushion the blow for the community? This is the 'Future Forum' requirement.

Safety: The Safety File Requirements

If you are tendering to provide services on a mine (e.g., a Cleaning Contractor or Security Company), you are subject to the mine's safety regime. You will not be allowed on site without a valid Safety File. This is often a 200-page lever arch file.

A 'SHE File' (Safety, Health, Environment) generally includes:

• Letter of Good Standing (COIDA): Non-negotiable. Proves your workers are insured against injury.
• Baseline Risk Assessment: A document analyzing every specific danger your workers will face (e.g., 'Slip and Fall', 'Chemical Exposure', 'Vehicle Rolling').
• Section 37(2) Agreement: A legal contract where you, the contractor, acknowledge that you carry the liability for your employees' safety, indemnifying the mine owner.
• Medical Certificates of Fitness: Every employee must pass an 'Exit Medical' and an 'Entry Medical' conducted by an Occupational Health Practitioner.
• Legal Appointments: clear organogram showing who is the appointed 'Safety Officer' (Section 2.17.1), 'First Aider', and 'Supervisor' (Section 2.9.2 appointments).

The Mining Charter III: Procurement Opportunities

Mining Charter III dictates that a mining right holder must procure specific percentages of goods and services from local companies. This is your entry point.

• 70% of Mining Goods must be from B-BBEE compliant entities (min 21% from Black Owned companies, 5% from Black Women Owned, 44% from B-BBEE compliant).
• 80% of Services must be from B-BBEE compliant entities (50% from Black Owned companies).

This is a massive artificial market creation for Black-owned SMEs. The mines are desperate to find compliant suppliers to meet these targets. If you are a 100% Black-owned specialized engineering firm, you are highly valuable. Market your B-BBEE status as aggressively as your technical capability.

Common Reasons for Tender Rejection

Why do 90% of applicants fail? Usually due to one of these three errors:

1. Lack of IDP Alignment: Proposing an SLP project that the Municipality hasn't signed off on. The DMRE checks with the Municipality. If they don't know you, you fail.
2. Financial Incompetence: Failing to provide a Bank Guarantee for rehabilitation costs. The DMRE calculates this 'financial provision' annually. It can be millions. You cannot use 'projected profits' to fund this; you need a guarantee upfront.
3. Consultation Failure: Failing to notify a single land claimant or affected community group during the public participation phase (Section 10 consultation). If one farmer says 'I wasn't told', the process halts.

Compliance Checklist for Mining Tenders

Before you submit, ensure you have these documents:

• Valid Company Registration (CIPC)
• Valid Tax Clearance Certificate (Pin)
• B-BBEE Certificate (Level 1 or 2 Preferred)
• COIDA Letter of Good Standing
• Central Supplier Database (CSD) Report
• Bank Rating Letter / Proof of Financial Capacity
• Safety File Index (Proof of existence)
• Environmental Authorization (if applicable)
• Blasting Certificates (if applicable)

Frequently Asked Questions (FAQ)

1. Q: How much does a Mining Permit application cost? A: The DMRE application fee is relatively low (approx R500), but the Environmental Authorization and consultant fees will cost between R150,000 and R300,000.
2. Q: Can I mine without a permit if it's on my own land? A: No. The State owns the mineral rights, not the landowner. You still need a permit.
3. Q: What is the 'One Environmental System'? A: It's a streamlined process where DMRE issues the environmental license, but the Department of Environment (DFFE) acts as the appeal authority.
4. Q: How long does a Section 54 Stoppage last? A: Until the DMRE inspector is satisfied that the safety risk has been rectified. This can be hours or weeks.
5. Q: Can I transfer my Mining Right to another company? A: Only with the Minister's written consent (Section 11 Transfer). This is a complex legal process.

Conclusion

Mining is a high-barrier, high-reward sector. It is not for the faint-hearted or the disorganized. Your 'Compliance Engine'—the team managing your SAMRAD status, your SLP reporting, and your Safety File—is the heart of your business. Do not treat compliance as a tick-box exercise. In mining, compliance is the license to print money. Lose your license, and the conveyor belts stop immediately.