Mineral and Petroleum Resources Royalty Act 28 of 2008


Government Gazette
REPUBLIC OF SOUTH AFRICA

Vol. 521 Cape Town 24 November 2008 No. 31635
THE PRESIDENCY No. 1260 24 November 2008
It is hereby notified that the President has assented to the following Act, which is hereby published for general information:–
No. 28 of 2008: Mineral and Petroleum Resources Royalty Act, 2008.

ACT To impose a royalty on the transfer of mineral resources and to provide for matters connected therewith.
BE IT E N A C T E D by the Parl iament of the Republic of South Africa, as fol lows:— A R R A N G E M E N T O F S E C T I O N S
Section
1. Definitions 2. Imposit ion of royalty 3. Determinat ion of royally 4. Royalty formulae 5. Earnings before interest and taxes 6. Gross sales 7. Small business exemption 8. Exemption for sampling 9. Rollover relief for disposals involving going concerns 10. Transfer involving body of unincorporated persons 11. A r m ' s length transactions 12. General ant i -avoidance rule 13. Conclusion of fiscal stability agreements 14. Terms and condi t ions of fiscal stability agreements 15. Foreign currency 16. Transitional credits 17. Act binding on State and application of other laws 18. Short title and commencemen t
Schedule 1 Schedule 2
Definitions
1. (1) In (his Act. unless the context indicates o the rwise— "Adminis tra t ion A c t " means the Mineral and Petroleum Resources Royalty (Adminis t ra t ion) Act . 2008; "earnings before interest and taxes" means earnings before interest and taxes ment ioned in section 5; "extrac tor" means a person ment ioned in section 2; "gross sa le s" means gross sales ment ioned in section 6: "Income Tax A c t " means the Income Tax Act, 1962 (Act N o . 58 of 1962); "Mineral and Petro leum Resources Deve lopment A c t " m e a n s the Mineral and Petroleum Resources Development Act. 2002 (Act No. 28 of 2002); "mineral resource" means a mineral or petroleum as defined in section 1 of the Mineral and Petroleum Resources Development Act . regardless of whether that
Act No. 28, 2008 MINERAL AND PETROLEUM RESOURCES ROYALTY ACT. 2008
mineral or petroleum undergoes processing (as defined in section I of that Act) or manufactur ing: "person" includes an insolvent estate, the estate of a deceased person and a trust: "refined mineral resource" means a mineral r e source— (a) listed solely in Schedule 1: or (b) listed in Schedule 1 and Schedule 2 that has been refined to or beyond the
condit ion specified in Schedule 1 for that mineral resource: "Republ i c" means the Republic of South Africa and includes the sea as defined in section 1 of the Mineral and Petroleum Resources Development Act; "royal ty" means the royalty imposed by this Act; "transfer" m e a n s — (a) the disposal of a mineral resource: (b) the export of a mineral resource; or (c) the consumpt ion, theft, destruction or loss of a mineral resource, other than by
way of flaring or other liberation into the a tmosphere dur ing explorat ion or product ion,
if that mineral resource has not previously been disposed of, exported, consumed , stolen, destroyed or lost: "unrefined mineral resource" means a mineral r e source— (a) listed solely in Schedule 2; or (b) listed in Schedule 1 and Schedule 2 that has not been refined to or beyond the
condition specified in Schedule 1 for that mineral resource; (2) Unless the context indicates otherwise , a word or expression to which a mean ing
has been assigned in the Administrat ion Act bears that meaning for purposes of this Act.
Imposit ion of royalty
2. A person that wins or recovers a mineral resource from within the Republ ic must pay a royalty for the benefit of the National Revenue Fund in respect of the transfer of that mineral resource.
Determinat ion of royalty
3. (1 ) The royally ment ioned in section 2 in respect of the transfer of a refined mineral resource is determined by mult iplying the gross sales of the extractor in respect of that mineral resource during the year of assessment by the percentage de termined in accordance with the formula in section 4(1).
(2) The royalty mentioned in section 2 in respect of the transfer of an unrefined mineral resource is determined by mult iplying the gross sales of the extractor in respect of that mineral resource during the year of assessment by the percentage determined in accordance with the formula in section 4(2).
Royalty formulae
4. (1) The percentage ment ioned in section 3(1) i s — 0.5 + learnings before interest and taxes/(gross sales in respect of refined mineral resources x 12.5)] x 100.
(2) The percentage ment ioned in section 3(2) i s — 0.5 + [earnings before interest and taxes/(gross sales in respect of unrefined mineral resources x 9 ) | x 100.
(3) (a) The percentage determined in terms of subsection (1) must not exceed 5 per cent.
Act No. 28, 2008 MINERAL AND PETROLEUM
RESOURCES ROYALTY ACT, 2008
(b) The percentage determined in terms of subsection (2) must not exceed 7 per cent.
Earnings before interest and taxes
5. (1) For purposes of the formula in section 4(1), "earn ings before interest and t a x e s " in respect of a year of assessment means the aggregate of—
(a) the gross sales of the extractor during that year in respect of refined mineral resources; and
(b) so much of the amount al lowed to be deducted from income in terms of the Income Tax Act (whether in that year or a previous year of assessment) in respect of the use of assets, or expendi ture incurred, directly in respect of mineral resources transferred on or after 1 May 2009 to win, recover and develop those mineral resources to the condit ion specified in Schedule 1, as is included in the income of the extractor during that year of assessment in terms of section 8(4) of that Act (disregarding the except ion in respect of section 15(a) of that Act) , but not including an amount that is received or accrued from the disposal of assets the cost of which has in whole or in part been included in capital expendi ture taken into account as ment ioned in the definition of "capital expenditure incurred" in section 36(11) of that Act,
less any amount which in terms of that Act is al lowed to be deducted from the income of the extractor during that year of assessment in respect of assets used or expendi ture incurred directly to win, recover and develop those refined mineral resources to the condit ion specified in Schedule 1 for those mineral resources .
(2) For purposes of the formula in section 4(2), "earn ings before interest and t a x e s " in respect of a year of assessment means the aggregate of—
(a) the gross sales of the extractor during that year in respect of unrefined mineral resources; and
(b) so much of the amount al lowed to be deducted from income in terms of the Income Tax Act (whether in that year or a previous year of assessment) in respect of the use of assets, or expendi ture incurred, directly in respect of mineral resources transferred on or after 1 May 2009 to win, recover and develop those unrefined mineral resources, as is included in the income of the extractor during that year of assessment in terms of section 8(4) of that Act (disregarding the exception in respect of section 15(a) of that Act) , but not including an amount that is received or accrued from the disposal of assets the cost of which has in whole or in part been included in capital expendi ture taken into account as mentioned in the definition of "capi tal expendi ture incurred" in section 36( 11) of that Act,
less any amount which in terms of that Act is a l lowed to be deducted from the income of the extractor during that year of assessment in respect of assets used or expendi ture incurred directly to win. recover and develop those unrefined mineral resources to the condit ion specified in Schedule 2 for those mineral resources .
(3) For purposes of subsections (1) and (2), "ea rn ings before interest and t a x e s " is determined without regard t o —
(a) any deduction in respect of a financial instrument as defined in section 1 of the Income Tax Act (other than an instrument that is an option contract, forward contract or other instrument the value of which is derived directly or indirectly with reference to mineral resources) :
(b) any deduction allowed in terms of section 1 11(a) of the Income Tax Act in respect of the royalty;
(c) (i) in the case of mineral resources refined to the condit ion specified in Schedule 1 for those mineral resources, any deduct ion for expendi ture
Act No. 28, 2008 MINERAL AND PETROLEUM RESOURCES ROYALTY ACT. 2008
incurred in respect of transport, insurance and handl ing of those refined mineral resources after those mineral resources were refined to that condition or any amount received or accrued to effect the disposal of that mineral resource; or
(ii) in the case of mineral resources brought to the condit ion specified in Schedule 2 for those mineral resources, any deduct ion for expendi ture incurred in respect of transport, insurance and handl ing of those unrefined mineral resources after those mineral resources were brought to that condition or any amount received or accrued to effect the disposal of that mineral resource;
(d) any balance of assessed loss mentioned in section 20(1 )(a) of the Income Tax Act, unless the balance of assessed loss arises in respect of capital expendi ture taken into account for purposes of paragraph 5( 1) of the Tenth Schedule of the Income Tax Act;
(e) any deduction al lowed in terms of section 24I of the Income Tax Act ; (f) any determinat ion in respect of an impermissible tax avoidance arrangement
contemplated in Part IIA of the Income Tax Act; or (g) any deduct ions contemplated in paragraph 5(2) of the Tenth Schedule to the
Income Tax Act . (4) (a) For purposes of determining "earn ings before interest and t a x e s " in the case
of a composi te of refined mineral resources and unrefined mineral resources, the refined and unrefined proport ions of the composi te mineral resource must be determined in accordance with a method of reasonable apport ionment that is consistently applied.
(b) For purposes of determining "earn ings before interest and t a x e s " , if the value of the refined proport ion of a composi te mineral resource as de termined in terms of subsection (1) does not exceed 10 per cent of the total value of that composi te mineral resource, that composi te mineral resource may be treated solely as an unrefined mineral resource, and if the value of the unrefined proport ion of a composi te mineral resource as so determined does not exceed 10 per cent of the total value of that composi te mineral resource, that composi te mineral resource may be treated solely as a refined mineral resource.
(5) For purposes of this section, if "earn ings before interest and taxes'" is a negative amount that amount is deemed to be nil.
Gross sales
6. (1) Gross sales in respect of a refined mineral resource t ransfer red— (a) as ment ioned in paragraph fa) of the definition of " t r ans fe r " in section 1 in the
condit ion specified for that mineral resource in Schedule 1 is the amoun t received or accrued during the year of assessment in respect of the transfer of that mineral resource;
(b) as ment ioned in paragraph (a) of the definition of " t r ans fe r " in section 1 in a condit ion other than that specified for that mineral resource in Schedule 1 is the amount that would have been received or accrued dur ing the year of assessment in respect of the transfer of that mineral resource had that mineral resource been transferred in the condit ion specified in Schedule 1 for that mineral resource in terms of a transaction entered into at a rm ' s length: and
(c) as ment ioned in paragraph (b) or (c) of the definition of " t r ans fe r " in section 1 is the amount that would have been received or accrued dur ing the year of assessment in respect of the transfer of that mineral resource had that mineral resource been transferred in the condition specified in Schedule 1 for that mineral resource in terms of a transaction entered into at a rm ' s length.
(2) Gross sales in respect of an unrefined mineral resource t ransferred—
Act No. 28. 2008 MINERAL AND PETROLEUM RESOURCES ROYALTY ACT. 2008
(a) as ment ioned in paragraph (a) of the definition of " t r ans fe r" in section 1 in the condition specified in Schedule 2 for that mineral resource is the amoun t received or accrued during the year of assessment in respect of the transfer of that mineral resource;
(b) as ment ioned in paragraph (a) of the definition of " t r ans fe r " in section 1 in a condition other than that specified for that mineral resource in Schedule 2 is the amount that would have been received or accrued during the year of assessment in respect of the transfer of that mineral resource had that mineral resource been transferred in the condition specified in Schedule 2 for that mineral resource in terms of a transaction entered into at a rm's length; and
(c) as ment ioned in paragraph (b) or (c) of the definition of " t r ans fe r " in section 1 is the amount that would have been received or accrued during the year of assessment in respect of the transfer of that mineral resource had that mineral resource been transferred in the condition specified in Schedule 2 for that mineral resource in terms of a transaction entered into at a rm's length.
(3) (a) For purposes of subsection (1). gross sales is determined without regard to any amount received or accrued in respect of transport , insurance and handl ing of a refined mineral resource after that mineral resource was refined to the condition specified in Schedule 1 for (hat mineral resource or any amount received or accrued to effect the disposal of that mineral resource.
(b) For purposes of subsection (2), gross sales is determined without regard to any amount received or accrued for the transport, insurance and handling of an unrefined mineral resource after that mineral resource was brought to the condit ion specified in Schedule 2 for that mineral resource or any amount received or accrued to effect the disposal of that mineral resource.
(4) (a) If no amount can be quantified in respect of a refined mineral resource transferred as ment ioned in subsection (1 )(a), gross sales in respect of that transfer is the amount that would have been received or accrued during the year of assessment in respect of that transfer had that mineral resource been transferred in the condit ion specified in Schedule 1 for that mineral resource in terms of a transaction entered into at a rm's length.
(b) If no amount can be quantified in respect of an unrefined mineral resource transferred as ment ioned in subsection (2)(a), gross sales in respect of that transfer is the amount that would have been received or accrued during the year of assessment in respect of that transfer had that mineral resource been transferred in the condi t ion specified in Schedule 2 for that mineral resource in terms of a transaction entered into at a rm ' s length.
Small business exempt ion
7. (1 ) An extractor is exempt from the royalty in respect of a year of assessment if— (a) gross sales of that extractor in respect of all mineral resources transferred does
not exceed R10 million during that year; (b) the royally in respect of all mineral resources transferred that would be
imposed on the extractor for that year does not exceed R 1 0 0 000 ; (c) the extractor is a resident as defined in section 1 of the Income Tax Act
throughout that year: and (d) the extractor is registered for that year pursuant to section 2 of the
Administrat ion Act. (2) An extractor is not exempt from the royalty as ment ioned in subsection (1 ) if—
(a) the extractor at any time during that year holds the right to participate (directly or indirectly) in more than 50 per cent of the share capital , share p remium. current or accumulated profits or reserves of, or is entitled to exercise more than 50 per cent of the voting rights in, any other extractor;
(b) any other extractor at any time during that year holds the right to participate (directly or indirectly) in more than 50 per cent of the current or accumula ted profits of the extractor;
Act No. 28, 2008 MINERAL AND PETROLEUM RESOURCES ROYALTY ACT, 2008
(c) any other person at any time during that year holds the right to part icipate (directly or indirectly) in more than 50 per cent of the profits of the extractor and more than 50 per cent of the current or accumulated profits of any other extractor; or
(d) (he extractor is a registered person mentioned in section 4 of the Adminis t ra­ tion Act.
Exempt ion for sampl ing
8. An extractor is exempt from the royalty imposed in respect of mineral resources won or recovered by the extractor for purposes of testing, identification, analysis and sampling ment ioned in section 20 of the Mineral and Petroleum Resources Develop­ ment Act pursuant to a prospecting right or an explorat ion right as defined in section 1 of that Act if the gross sales in respect of those mineral resources does not exceed R100 000 during a year of assessment .
Rol lover relief for disposals involving going concerns
9. (1) For purposes of this Act a disposal of a mineral resource by an extractor that forms part of the disposal of a going concern, or of a part of a going concern which is capable of separate operation, by that extractor to any other extractor is deemed not to be a disposal .
(2) For purposes of this Act an extractor that acquires a mineral resource in terms of a disposal ment ioned in subsection (1) is deemed to be the extractor that won or recovered the mineral resource.
Transfer involving body of unincorporated persons
10. (1) Notwi ths tanding any other provision in this Act, an unincorporated body that is registered as a person under the Administrat ion A c t —
(a) is deemed to be an extractor while that registration remains in effect; and (b) is subject to the royalty as if that body were an extractor separate from its
members , in respect of mineral resources won, recovered or transferred by that unincorporated body after taking into account any earnings before interest and taxes associated with those minerals as well as the application of any other provision of this Act bear ing on the royalty determinat ion in respect of those mineral resources.
(2) Notwi ths tanding any other provision in this Act . to the extent that any member of an unincorporated body ment ioned in subsection (1) is acting in a capacity other than as a member of that body, that member is subject to the royalty as if that member were an extractor separate from that body in respect of mineral resources won, recovered or transferred by that unincorporated body after taking into account any earnings before interest and taxes associated with those minerals as well as the application of any other provision of this Act bearing on the royalty determinat ion in respect of those mineral resources .
(3) On the date of the election made in terms of section 4(1) of the Adminis t ra t ion Act, the member s of an unincorporated body ment ioned in that section are deemed to have transferred the mineral resources to be disposed of by that body, which had been won or recovered by those members .
(4) On the dale on which an unincorporated body terminates the election in terms of section 4(6) of the Administrat ion Act, the unincorporated body is deemed to have transferred the mineral resources won or recovered by the unincorporated body to the members of that unincorporated body.
A r m ' s length transact ions
11. (1) To the extent that the earnings before interest and taxes de termined in terms of section 5 differ from the earnings that an extractor would have taken into account if
Act No. 28, 2008 MINERAL AND PETROLEUM RESOURCES ROYALTY ACT, 2008
those earnings had been derived from transactions entered into at a rm ' s length, the Commiss ioner may adjust the earnings to reflect the earnings that would have been taken into account.
(2) To the extent that the gross sales determined in terms of section 6( 1 )(a) or section 6(2)(a) differ from the gross sales that an extractor would have taken into account if the gross sales had been derived from transactions entered into at a rm ' s length, the Commiss ioner may adjust the gross sales to reflect the gross sales that would have been taken into account.
General ant i -avoidance rule
12. (1) Notwiths tanding anything to the contrary in this Act, if the Commiss ione r is satisfied that a disposal , transfer, operation, scheme or unders tanding (whether entered into or carried out before or after the commencemen t of this A c t ) —
(a) has been entered into or carried out. which has the effect of avoiding or postponing liability for the royalty, or of reducing the amount thereof;
(b) having regard to the circumstances under which the disposal , transfer, operat ion, scheme or understanding was entered into or carried ou t— (i) was entered into or carried ou t—
(aa) in the case of a disposal , transfer, operat ion, scheme or understand­ ing in the context of business, in a manner which would not normally be employed for bona fide business purposes , other than the obtaining of a royalty benefit; and
(bb) in the case of any other disposal , transfer, operat ion, scheme or understanding not falling within the provis ions of i tem (aa), by means or in a manner which would not normally be employed in the entering into or carrying out of a disposal , transfer, operat ion, scheme or understanding of the nature of the disposal , transfer, operation, scheme or understanding in quest ion; or
(ii) has created rights or obligations which would not normally be created between persons dealing at a rm ' s length under a disposal , transfer, operation, scheme or understanding of the nature of the disposal , transfer, operat ion, scheme or understanding in quest ion; and
(c) was entered into or carried out solely or mainly for the purposes of obtaining a royalty benefit,
the Commiss ioner must determine the liability for the royalty, and the amount thereof, as if the disposal , transfer, operation, scheme, or unders tanding had not been entered into or carried out, or in such manner as the Commiss ioner in the c i rcumstances deems appropriate for the prevention or diminution of avoidance, pos tponement or reduct ion.
(2) A decision of the Commiss ioner under subsection (1) is subject to objection and appeal ment ioned in section 18(l)(d) of the Adminis t ra t ion Act . and whenever in proceedings relating thereto it is proved that the disposal , transfer, operat ion, scheme or unders tanding in quest ion would result in the avoidance or pos tponement of liability for the royalty, or in the reduction of the amount thereof, it is presumed, until the contrary is proved, in the case of any such disposal, transfer, operation, scheme or unders tanding, that it was entered into or carried out solely or mainly for the purposes of the avoidance or the pos tponement of such liability, or the reduction of the amount of such liability.
(3) For purposes of this section, "royalty benefit" includes any avoidance , pos tponement or reduction of the liability for payment of the royalty ment ioned in section 2.
Conclus ion of fiscal stability agreements
13. (1) The Minister of Finance may conclude a binding agreement with an ext rac tor—
(a) in respect of the extractor ' s mineral resource right; or (b) in anticipation of the extractor acquir ing a mineral resource right.
Act No. 28, 2008 MINERAL AND PETROLEUM RESOURCES ROYALTY ACT, 2008
that guarantees that the terms and condi t ions contemplated in section 14 apply in respect of the right for as long as the extractor holds the right (and for all part icipating interests subsequently held by the extractor in respect of the right).
(2) A binding agreement relating to the anticipated acquisition of a mineral resource right contemplated in subsection (l)(b) has no force and effect unless the mineral resource right is granted within one year after the date on which the Minis ter of Finance concludes the binding agreement .
(3) If an extractor disposes of a prospect ing right or an explorat ion right granted under the Minera l and Pet ro leum Resources Development Act to another person, and the right is subject to a binding agreement ment ioned in subsection (1) on the date of the disposal , the extractor may assign all the rights held by the extractor under the agreement to the other person.
(4) If an extractor disposes of a mining right or a product ion right granted under the Mineral and Petroleum Resources Development Act to another person, and the right is subject to a binding agreement ment ioned in subsection (1) on the date of the disposal , the extractor may assign all the rights held by the extractor under the agreement to the other person, if both the extractor and the other person form part of the same group of companies (as defined in section 1 of the Income Tax Act) on the date of the disposal .
(5) An extractor that concludes a binding agreement ment ioned in subsection (1) may unilaterally terminate the agreement at any t ime with effect from the day after the last day of the year of assessment during which the extractor terminated the agreement .
(6) For purposes of this sec t ion— (a) a prospect ing right, a renewal of the prospect ing right and an initial min ing
right conver ted from a prospect ing right or renewal thereof held by an extractor: and
(b) an explorat ion right, a renewal of the exploration right and an initial product ion right converted from an exploration right or renewal thereof held by an extractor,
are, to the extent that those rights relate to the same geographical area, all deemed to be one and the same mineral resource right in the hands of the extractor.
(7) The powers conferred and the duties imposed upon the Minis ter of Finance by the provisions of this section may be exercised or performed by the Minis te r personally or delegated by the Minis ter to the Director-General of the National Treasury and the Director-General may in turn delegate the powers and duties so delegated to him or her to any officer or person under his or her control , direction or supervis ion.
(8) For purposes of this section "minera l resource r ight" means a prospect ing right, explorat ion right, mining right or production right granted pursuant to the Mineral and Petroleum Resources Deve lopment Act, and includes any lease or sublease ment ioned in section 11 of that Act in respect of such right.
Terms and condit ions of fiscal stability agreements
14. ( I ) An amendmen t of section 4 has no force and effect in respect of an extractor that is party to an agreement contemplated in section 13(1) if the amendmen t has the effect that the extractor becomes subject to a royalty which is greater than the royalty to which the extractor would otherwise have been subject.
(2) If the Stale fails to comply with the terms of an agreement con templa ted in section 13( 1) and the failure has a material adverse economic impact on the determinat ion of the royalty payable by the extractor that is party to that agreement , the extractor is entitled to compensa t ion in respect of the increase in the royalty caused by the failure (and interest at the prescr ibed rate calculated on the compensat ion from the date of the failure) or to an alternative remedy that el iminates the full impact of the failure.
Foreign currency
15. A n y amount received by or accrued to, or expendi ture or loss incurred by. an extractor in any currency other than the currency of the Republ ic must be translated to
Act No. 28, 2008 MINERAL AND PETROLEUM RESOURCES ROYALTY ACT, 2008
the currency of the Republ ic by applying the spot rate, as defined in section 1 of the Income Tax Act, on the date on which that amount was so received or accrued or expendi ture or loss was so incurred.
Transitional credits
16. (1) There must be deducted from the royalty payable in respect of a mineral resource the amount of any lease, royalty or similar payment to the State in respect of that mineral resource in terms of any condi t ions imposed pursuant to the laws appl icable in respect of an old order right or O P 2 6 right ment ioned in Schedule II of the Mineral and Petroleum Resources Deve lopment Act, as considerat ion for the removal or disposal of a mineral or petroleum.
(2) N o deduct ion is al lowed in terms of subsection (1) in respect of any lease ment ioned in item 9(7) of Schedule II to the Mineral and Petroleum Resources Deve lopment Act .
(3) The amount to be deducted in terms of subsect ion (1) must not exceed the royalty ment ioned in that subsect ion.
Act binding on State and appl icat ion of o ther laws
17. This Act binds the State, and no provision in any other law is const rued as applying or referring to this royalty unless the royalty is specifically ment ioned in that provision.
Short title and c o m m e n c e m e n t
18. (1) This Act is called the Mineral and Petroleum Resources Royalty Act, 2008 . (2) This Act comes into operat ion on 1 May 2009 and applies in respect of a mineral
resource transferred on or after that date.
Act No. 28, 2008 MINERAL AND PETROLEUM
RESOURCES ROYALTY ACT, 2008
Mineral resource name
Refined condition
Cobalt Cobalt is refined once processed into cobalt metal or cobalt sulphate. 99.5 % refined
Copper Copper is refined once processed into copper metal slabs, blister cop­ per or cathode copper of at least 99.0 % purity.
Germanium 99.99% refined product
Gold Refined and smelted to a 99.5 % purity
Lead Lead is refined once processed into bars and billets containing at least 99.0 % pure lead.
Lithium 99.5% LiC03 in concentrate (lithium carbonate)
Mercury 99.9% purity
Nickel (Base metal) Nickel is refined once processed into a metal, or other form (e.g. ferro nickel, nickel metal or nickel sulphate). 99.5% purity
Platinum Group Metals (iridium, palladium, platinum, rhodium, ruthenium and osmium)
Refined and smelted to a 99.9 % purity
Molybdenum 99.99% refined product
Silicon 98.5% Si
Silver Silver is refined once processed to silver metal or silver nitrate. 99.5% refined
Talc- 98.5% and minus 325 um mesh
Zinc Zinc is refined once processed into zinc metal, plates or slabs con­ taining at least 98.5 % pure zinc.
Mineral resource Refined condition name
Oil and Gas
Oil At inlet of refinery
Gas At inlet of refinery
S C H E D U L E 1
R E F I N E D C O N D I T I O N O F M I N E R A L R E S O U R C E S
Act No. 28, 2008 MINERAL AND PETROLEUM
RESOURCES ROYALTY ACT, 2008
Mineral resource name
Unrefined condition
Aggregates Bulk
Antimony 65% Sb content in the concentrate
Barite Concentrates with 97% BaS04
Beryllium 70% beryl concentrate
Chrome ore in lump, chips and fines
(i) 37% to 46% Cr203 in concentrate: (ii) 4% to 10% SiO2 and a
(iii) Cr/Fe ratio of 1.25 to 1.45 (chip and lump) or (iv) 0.8% to 6% S i 0 2 and (v) Cr/Fe ratio of 1 3 to 1.6 (fine < 1mm)
Clay used for bricks Bulk
Kaolinite clay used by paper and ceramic sectors
Coal Grade A: in situ calorific value equal or greater than 27.5 GMJ/kg Grade B: in silu calorific value equal of greater than 26.5 GMJ/kg and less than 27.5 GMJ/kg Grade C: in situ calorific value equal or greater than 19.0GMJ/kg and less than 26.5 GMJ/kg Grade D: in situ calorific value less than 19.0 GMJ/kg
Cobalt 7% Co in a polymineralic matte
Copper 20% to 30% Cu
Diamond Rough Diamonds
Dimension stone: Granite, Sandstone, Slate. Shale, Gneiss. Marble
Bulk
Fluorspar 80% concentrate
Graphite 86% carbon content
Iron ore 61 % to 64% Fe content
Lead Concentrate with a minimum of 50%> Pb
Limestone Concentrate with a minimum of 54% CaCO,
Manganese Manganese ore: Mn 37% to Mn 48% and Si + Al less than 11%
Mica 48% concentrate
Mineral Sand (Titanium)
llmenite 75% ilmenite concentrate
Rutile 53% Rutile concentrate
Zircon 85% Zircon concentrate
Nickel 1.4% Ni content
S C H E D U L E 2
U N R E F I N E D C O N D I T I O N O F M I N E R A L R E S O U R C E S
Act No. 28, 2008 MINERAL AND PETROLEUM RESOURCES ROYALTY ACT, 2008
Mineral resource name
Unrefined condition
Niobium 45% N i 2 0 5 in concentrate
Platinum Group Metals (iridium, palladium, platinum, rhodium, ruthenium and osmium)
concentrate (150 ppm)
Sand Bulk
Silver 800g/t Ag in polymineralic base metal
Tantalum In concentrate 30% T a O s . Max 0.5% U , O s and ThO, combined
Tin 86% cassiterite concentration
Tungsten (CaW0 4 ) and Wolram
Minimum 65% W O , in concentrate
Uranium 80% uranium in concentrate. Oxide (yellow cake) and Uranium Hexafliiuride.
Vanadium Concentrate > 1 % V 2 O s equivalent and less than 2% calcium and silica bearing gangue minerals ( S i 0 2 + CaO)
Zinc (Base metal) 27% Zn in concentrate
Other Minerals not listed elsewhere
Concentrate or where the specific mineral is not rendered into a con­ centrate, bulk. e.g. Phosphate Rock, Vermiculite, Semi-precious gemstones (like rose quartz, tiger's eye; corundum; etc). Precious gemstones (like sugilite). Feldspar, Garnet, Peat, Perlite, Rare Earth Elements, Silica, Soda Ash, Wollastonite, Zeolite, etc.