Mr Nikisi Lesufi, Senior Executive Ms S Mudau, Head Environment ONE ENVIRONMENTAL SYSTEM AND Water conservation and water demand management in the mining industry

Outline Background to One Environmental System 2. Regulatory Challenges Regulation of Mine Residue Deposits and Stockpile in terms of NEM: Waste Amendment Act NEMA Financial Provision Regulations Foundation of Water Conservation and Water Demand Management ( WCWDM) Implementation of WCWDM in the mining industry- Collaboration between the Department of Water and Sanitation and Chamber of Mines Conclusions Footer inserted through Slide number menu xx Month 2015

BACKGROUND TO ONE ENVIRONMENTAL SYSTEM 1. One Environmental System (OES) entails the following Environmental matters for mining and related activities will be regulation in terms of NEMA and its regulations no longer in terms of the MPRDA. Thus the Minister of Environmental Affairs will set environmental policies and regulations for the mining sector. The Minister of Mineral Resources will be the competent authority to implement NEMA and its regulations. The Minister of Environmental Affairs will be the appeal authority Synchronisation of timeframes to ensure that Environmental Authorisation, Water Use License and Mining licenses are issued within 300 days Legislative amendments to MPRDA, NEMA, SEMA, NWA and associated regulations to give effect to the agreement.

REGULATORY CHALLENGES (Regulation of Mine Residue Deposits and Stockpile as Waste) Regulation of Mine Residue Deposits and Stockpile ( MRDS) as Waste Over years MRDS has been excluded from the NEM Waste Act Amendment of the National Environmental Management Laws Amendment Act (NEMLA) 3 led to the amendment of the Waste Act which included the MRDS as hazardous waste. Technical, Financial, Legal risks/implications of managing MRDS in terms of the Waste Act. Footer inserted through Slide number menu xx Month 2015

REGULATORY CHALLENGES (Regulation of Mine Residue Deposits and Stockpile as Waste) Chamber of Mines (COM) Position COM position has always been that MRDS are not waste but a resource in terms of the MPRDA. It is not technical and financially viable to manage MRDS in terms of the Waste Act Managing MRDS as waste poses some safety and technical risks for a mining operation Environmental Impacts emanating from MRDS are extensively managed through the MPRDA and now through NEMA and its regulations, and also through the application of best available technologies. Chamber’s Engagements Efforts The COM has obtained letters from the Minister of Environmental Affairs acknowledging that MRDS should not be managed as waste and further committing to fixing this regulatory mistake through NEMLA 4 which would amend the Waste Act. The COM has also succeeded in obtaining a concession from the Department of Water and Sanitation to move away from the prescriptive approach of requiring a lining system as per the Waste Act to adopting a risk based approach. Despite the above mentioned achievements, the fact that the NEM Waste Act is in force and companies are expected to comply remains a challenge. The COM has been hard at work in an attempt to pursue the Department to implement the following possible interim measures whilst embarking in a process to amend the Waste Act - Exclusion of MRDS from the ambit of NEM Waste Act - Temporal suspension of certain section of the Waste Act concerning MRDS

REGULATORY CHALLENGES (NEMA Financial Provision Regulations) Concerns in relation to NEMA Financial Provision Regulations Duplicate Funding/Double Provisioning Funding for ongoing rehabilitation, funding for premature closure Trust Funds Barriers to use of trust fund Tax implications/expropriation of existing trust funds Inclusion of Care and Maintenance in the regulations Onerous Auditing requirements Time frames for implementation COM’s Engagements Efforts Publication of the Interpretation Note Publication of the revised NEMA FP regulations ( extension of the time frame for implementation) Letter from the DG committing to revise the regulations jointly with the industry through a formation of task team Footer inserted through Slide number menu xx Month 2015

Foundation of WCWDM “This NWRS2 sets out the strategy to plan, develop, manage, protect and control the use of our water resources effectively for the future.” “Good governance, improved management of our resources and ensuring that every drop counts are addressed in the strategy, through an improved institutional framework, strengthening our sector capacity, and through various mechanisms and concepts, such as water re-use and water off-setting.” Footer inserted through Slide number menu xx Month 2015

NWRS 2 – Key principles & statements “The purpose of the NWRS2 is to ensure that national water resources are protected, used, developed, conserved, managed and controlled in an efficient and sustainable manner towards achieving South Africa's development priorities in an equitable manner over the next five to 10 years.”  “The NWRS2 acknowledges that South Africa is a water-stressed country and is facing a number of water challenges and concerns, which include security of supply, environmental degradation and resource pollution, and the inefficient use of water.”   The most important consideration in all themes discussed (in the NWRS2) is that water is scarce and it requires careful management to enable provision of basic water services and equitable allocation...... September 17, 2018

  NWRS2 – Chapter 7: WCWDM The DWA has developed a National WCWDM Strategy, supported by three subsidiary strategies, focussing on water services, agriculture, and industry, mining and power generation.  Industry & mining sector uses close to 16% of the total water demand in South Africa – WCWDM must be integrated into these operations as a priority September 17, 2018

How is WC/WDM implemented in mining? Mining WC/WDM Project Chamber of Mines and Department of Water and Sanitation WUE Indicators & Benchmarks Report Implementation Guideline SWAF Regulations New BPG G6 September 17, 2018

WC/WDM Implementation Guideline September 17, 2018

SWAF Components September 17, 2018

WC/WDM Plan – How to do it GUIDELINE METHODOLOGY PRACTICAL PHASED APPROACH PHASE 3: FINAL WC/WDM PLAN Undertake process engineering evaluations of preferred management options to develop capital and operating costs. Based on budget constraints and WUE improvements – select and schedule options to include in final WC/WDM Plan Prepare final WC/WDM plan Prepare SWAF reporting documentation PHASE 1: WC/WDM MANAGEMENT OPTIONS REPORT Undertake site assessment Develop water balance basis of design Determine baseline water use efficiency indicators Identify WC/WDM options to be considered in Phase 2 PHASE 2: PRELIMINARY WC/WDM PLAN Develop a detailed computerised predictive water balance Use water balance to simulate and provide data on water use efficiency (WUE) improvements that can be achieved with each management option Develop first order cost assessments of potential options Rate and rank options to choose which to take to Phase 3 September 17, 2018

WC/WDM in Mining: Key Principles  All mines must submit WC/WDM plans with WUE targets (every 5 years) and achieve maximum savings in shortest possible time  WUE benchmarks are viewed as minimum compliance and are not aspirational targets  WC/WDM plans to be prepared in accordance with procedures set out in Implementation Guideline  All new Water Use Licences require submission of WC/WDM plans  All WC/WDM plans will be rated and ranked by SWAF system and ranking will be used to guide regulator administrative procedures: Water use allocations Water use restrictions  Excellent WC/WDM plan is a business risk management measure September 17, 2018

Conclusion Having best WC/WDM plan and WUE indicators in a particular water management area and commodity sector is the only way to maximise security of water supply Approach is self-regulatory – business security incentives for top performers The aim to develop and submit best possible WC/WDM plan possible if incentives /rewards are to be realised – this is NOT a regulatory “tick the boxes” issue Proactive, not wait for regulations or WUL instruction to submit WC/WDM plan as the process is proceeding full speed already (snooze and lose!) Rating and ranking happens automatically according to fixed SWAF rules – not dependant on human whim or error !! Footer inserted through Slide number menu xx Month 2015