• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 22 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 3 days "What’s In Store For Europe In 2023?" By the CIA (aka RFE/RL as a ruse to deceive readers)
  • 7 days America should go after China but it should be done in a wise way.
  • 1 day Even Shell Agrees with Climate Change!
  • 3 days How Far Have We Really Gotten With Alternative Energy
  • 4 days The European Union is exceptional in its political divide. Examples are apparent in Hungary, Slovakia, Sweden, Netherlands, Belarus, Ireland, etc.
  • 14 mins Microbes can provide sustainable hydrocarbons for the petrochemical industry
  • 3 days World could get rid of Putin and Russia but nobody is bold enough
  • 6 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in
Dave Forest

Dave Forest

Dave is Managing Geologist of the Pierce Points Daily E-Letter.

More Info

Premium Content

Platinum, Gold And Coal Prices Could Be Impacted By South Africa’s “26% Rule”

The national government this week released a key policy review. Looking at how “black economic empowerment” (BEE) rules have been implemented by the mining sector.

One of the biggest outcomes from the report was continued controversy over the “26% rule”. Which states that black interests in the country must control at least 26% of South African mining firms. Related: Energy Stocks May Be A Safe Haven For U.S. Investors

The problem, according to the report, has been the implementation of this rule. With officials pointing out that some miners have achieved 26% black ownership for a short period — but then slipped back below the threshold percentage after BEE shareholders sold their equity in the company.

Mining firms contend that such selling is beyond their control. And that they should be considered to have met BEE obligations so long as they initially come in above the 26% threshold — regardless of what happens to shareholdings afterward. Related: Why Putin Doesn’t Need To Pander To The West

The government sees it differently. Saying that miners should be required to maintain 26% BEE ownership at all times.

Officials from both the government and mining groups say there is still “no consensus” on how to resolve this issue. And so the South African Chamber of Mines has agreed to approach the courts, along with state regulators, to ask for a final decision.

The government noted that a court judgment on the issue could come down as early as April. Which will be a critical shift for the mining industry here. Related: Is Warren Buffett Wrong About Oil Stocks?

If judges do uphold the government’s position, it will be one more burden for miners to bear. Companies will be forced to find a way to maintain a perpetual 26% BEE ownership — which could mean giving discounted shares to applicable holders, or implementing other financial strategies.

The bottom line is that corporate costs would go up. At a time when the South African industry is already battling high production costs, and low metals prices. Watch for a decision from the courts over the coming weeks — it could have important implications for commodities like platinum, gold and coal.

Here’s to maintaining control,

ADVERTISEMENT

Dave Forest

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News