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Illegal award of mining licences on LHDA sites blocked

MATIISETSO MOSALA

Former Minister of Mining, Keketso Sello, illegally instructed his subordinates to award mining leases to a local joint venture company on 14 sites located on land that had been earmarked for the state to develop Polihali Dam related infrastructure.

The land had been “set aside for public purposes” in Legal Notice number 71 of 2012 issued by then Minister of Local Government and Chieftainship, Pontšo ‘Matumelo Sekatle, under the Land Act of 2010.

The declaration paved the way for the construction of Polihali Dam under phase two of the Lesotho Highlands Water Project, with projections from the Lesotho Highlands Development Authority (LHDA) that water sales to South Africa would jump from 780 to 1,270 million cubic metres per annum by 2026.

To enforce this declaration, two ministries, Mining and Water, brokered a Memorandum of Agreement in 2018 binding the mining department to consult and get approval from the LHDA whenever it issued mining leases on its allocated land.

“Pursuant to the agreement signed between Mining and the Ministry of Water, applicants interested to mine within the LHDA area are bound to submit applications to the ministry with a letter of concurrence from the LHDA,” explained Tšokolo Maina, the Ministry of Mining’s Principal Secretary.

Sello however is said to have disregarded this agreement and the preceding declaration by instructing the Ministry of Mining officials to issue quarrying licences to a company called T Squared Joint Venture on the LHDA area. Sello told MNN that the Ministry of Mining is autonomous and his actions were based on the Mines and Minerals Act.

According to the LHDA chief executive, Tente Tente, the illegal issue of leases on their land could delay the completion of the Polihali project which could, in turn, cost the country about M46-million cumulative loss of revenue.

Between June and July 2019, the ministry of mines, through the Commissioner of Mines and the Mining Board, accepted quarry licenses applications from three companies: T Squared Joint Venture, Talis Industrial Holdings and Nemesis Capital Partners.

In its application, T Squared Managing Director Thabiso Lekitla pointed out that they were applying to mine dolerite, sand, and gravel for road construction where “Polihali access roads will be constructed”.

T Squared succeeded in their application and on 8 August 2019, Mining Board Chairperson and Principal Secretary Ntahli Matete, instructed them to provide an Environmental Impact Assessment (EIA) for mining lease approval.

MNN Centre for Investigative Journalism understands however that when Matete issued this instruction, there was no concurrence letter from the LHDA. When he was asked to explain this discrepancy, Matete said: “I have retired, the current administration should answer to this, they have inherited it”.

Speaking to MNN, Themba Sopeng who succeeded Matete during Sello’s tenure, said Sello allegedly instructed the Commissioner of Mines, Pheello Tjatja, and the Secretary of the Mining Board, Mathalea Lerotholi, to issue the quarry licenses to T Squared, without the LHDA’s approval.

Sello denies instructing Tjatja and Lerotholi to issue these licenses. Instead he said he was acting on the recommendation of the Mining Board when considering issuance of the licences.

Sopeng countered this saying the Mining Board informally told Sello to reject T Squared application because it was for a location within the LHDA allocated site. Despite this, Sello instructed the Board to issue the licences, according to Sopeng’s sources.

“[The] Mines and Minerals Act gives the Ministry of Mining autonomy on issuing mining and quarrying licenses to anyone who qualifies,” Sello told MNN. On the contrary, Sopeng said that mining misrepresented itself by considering T Squared applications against the existing agreement which the same ministry is party to.

Sello felt strongly that Basotho owned companies, like T Squared, should be preferred for quarrying licences against South African companies, such as HSPY Joint Venture and Rumdel Construction, which in June 2019 won two major LHDA tenders to construct Polihali access roads and were supposed to get licences to start quarrying.

According to Tente, two local companies, These Construction and Thadleson, lost their bid for these tenders and immediately banded together to form T Squared, which then applied for quarrying licences for quarries and borrow pits that were set aside for winners of Polihali roads tenders.

“Knowing that roads construction requires gravel, blasting and the likes, we saw an opportunity to apply for quarry licenses for use if we won the LHDA tenders or sell excavates to the winners if we lost,” T Squared managing director Thabiso Lekitla told MNN.

As soon as the LHDA became aware that Mining was considering a T Squared mining licence on their site, Tente said they asked the ministry not to approve any applications for licences within their project area.

In 2020, before the licences were issued, Sello was shuffled from Mining to the Ministry of Small Businesses, which was when the decision to issue the licences to T Squared was overturned. “The Mining Board was now able to do the right thing because the person who held them hostage had left,” Sopeng told MNN.

T Squared reacted by dragging the Ministry of Mining to court last year, demanding M800 thousand in compensation for their “Legitimate Expectation” that they were going to be issued the quarry licences.

In their court papers, Lekitla claimed rights over the 14 quarry sites, saying that his joint venture is entitled for compensation before those rights could be revoked and transferred to another party because they had incurred expenses on purchasing machinery and conducting an EIA that was a prerequisite for their application.

“Even in the Chairperson of the Board [Matete]’s letter to us that requested that we do an EIA, there was no indication that our application was still due for further evaluation…the Mining Board advised us that as soon as we secured and submitted an Environmental Clearance, it would recommend to the Minister to issue mining leases in our favour,” Lekitla said.

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