… In granting renewal of expired prospecting licence says Attorney General’s Chambers
The Attorney General’s Chambers has revealed that the renewal of a Prospecting Licence (PL) of one of the suitors vying to develop the multi-million dollar bauxite deposits on Rennell, was approved almost 12 months after it has expired.
At the same time, it reveals that neither the Board nor the Minister has the power to renew a licence that has already expired.
Asia Pacific Investment Development Ltd’s (APID’s) PL 04/08 expired on 04th December 2011, according to written advice tendered by the Attorney Generals Chambers’ Principal Crown Counsel, John Muria (Jnr) to the Ministry of Mines, Energy and Rural Electrification.
The letter said the Mines and Minerals Board approved the renewal on 28 November 2012 – just six days short of a full 12 months after the prospecting licence had expired.
“As such, the Board and or Minister had no power to renew a licence that has already expired. The proper procedure in that circumstances will be for a new application to be made.”
Other documents showed that APID had never submitted a report on its prospecting work for 30 months, a breach of the requirements of its prospecting licence.
Despite this, the company appeared to have enjoyed the support of the Mines and Minerals Board as well as a former Director of Mines and a Permanent Secretary of the Ministry of Mines, Energy and Rural Electrification.
The Director of Mines is also the Chairman of the Mines and Minerals Board. Both men have since been removed from their posts.
According to Mr Muria (Jnr) the Board acted illegally in approving the renewal of APID’s Prospecting Licence.
“Section 24(1) is clear in its interpretation. It states that unless renewed, a prospecting licence expires on its third anniversary. Section 24(2) further states that a prospecting licence can be renewed for a period of two years but requires that any application for renewal must be made to the Director thirty (30) days from the licence’s expiration,” Mr Muria’s (Jnr) letter dated 16 March 2015 said.
“From my perusal of the Mines Act, there are no provisions in the Mines Act that allow or provide for an extension of a prospecting licence to allow the prospecting licence to subsist for a fourth year. The use of the word “shall” in section 24(1) specifically states that a licence can only be valid for a period of not exceeding three (3) years,” the letter, reference No. AG24, said.
“In light of the above, it is my opinion that the Board in deliberating and approving the request for an extension acted ultra vires. As such the extension in the prospecting licence by the Board and or the Minister was null and void.
“As a consequence, PL 04/08 ceased to have any legal effect as of 4th December 2011,” the letter said.
The letter by Mr Muria (Jnr) also showed that Prospecting Licences and Mining Leases given to both APID and PT Mega Bintang Borneo Ltd were “void” because the proper procedure was not followed.
In a series of recommendations, the letter urges the Mines and Minerals Board to reconvene and reconsider applications by both foreign investors.
“That an opportunity must be given to both APID and Bintang to resubmit their applications for prospecting licence and mining lease respectively,” the letter said.
The Ministry appears to have ignored the recommendations. And according to PT Mega Bintang Borneo Ltd, its letters to the Ministry have never been attended to.
The rich bauxite deposits on Rennell were hotly pursued in the 70s. Japanese company, Mitsui Mining and Smelting (MMS) and Pacific Aluminium (PAL), were the first to carry out prospecting in West Rennell.
But it could not proceed after eight years due to costs. In 1977 Mitsui abandoned the project, advising the Solomon Islands Government by telegram that it could not proceed with the project due to costs.
At the time the company discovered a proven reserve of 12.5 million dry metric tonnes and a further 14 million tonnes of indicated reserves.
Both companies estimated annual production of between 480, 000 – 600, 000 tonnes of bauxite.
By Alfred Sasako
