Sharda Naidoo
28 May 2003
Johannesburg — Tourism and minerals departments lock horns over the ramifications of the project on investments
A BOOMING Eastern Cape ecotourism industry is under threat as SA prepares to put the final seal on a multimillion dollar Australian mining deal along the pristine Xolobeni area abutting the Mkimbati Nature Reserve.
SA has in theory approved the mining development by awarding Transworld Energy & Minerals Resources SA in which Perth-based Mineral Commodities has a 75% stake a permit to mine ilmenite for titanium production but, in doing so, has sacrificed its own ecotourism investment.
The permit was granted in March last year and is valid until July 13 next year, with an option to extend for a further two years.
The only obstacle is an environment impact assessment report, which has met with resistance by various environmental and tourism stakeholders.
They argue that commercial mining will sink an already viable ecotourism industry in the Wild Coast region.
This tentative deal has also pitted the minerals and energy department against the environmental affairs and tourism department, resulting in a task team being set up to iron out the conflicting issues that have created so much controversy.
Both departments are fighting to protect their investments and interests. The SA Export Development Fund has reportedly snapped up nearly R2m worth of shares in the mining project (Xolobeni Mineral Sands), and Minerals and Energy Minister Phumzile Mlambo-Ngcuka has a duty to ensure the development goes ahead as planned.
Alternatively, the local, provincial and national departments of environmental affairs and tourism have collectively ploughed à 2m into the à 15m Wild Coast ecotourism programme, of which à 13m is funded by the European Union, over four years.
The programme, in its third year, has already generated an income of R1,5m and created about 500 fulltime and 1000 part-time jobs.
It has also resulted in the emergence of 180 small business enterprises in local communities.
Next year, the programme which has 132 thriving projects including horse and hiking trails, and fly fishing is expected to generate at least R4,5m.
The environmental affairs and tourism department anticipates revenue streams to double to R9m by 2009, by which time 5000 fulltime and about 7000 part-time jobs would have been created. These figures exclude monies generated and jobs created through private sector ecotourism ventures.
However, the future viability and growth of these projects which extend about 200km from the Umtamvuna River to the Kei River is at stake as government works to sidestep the environmental issues to make way for mining .
In comparison, the mining company says it will create 270 permanent jobs, with additional posts generated through contracts and indirect ancillary services.
Estimated annual revenue will be in excess of 75m, and the company says mineral resources suggest a 17-year life, with a mine value of over $1,3bn.
But, at the end of that period the area is bound to be stripped of its natural glory due to the company's plans for large scale conventional dry mining.
The ilmenite deposits extend over a strike length of 22km, averages 1,5km in width and has a maximum depth of 50 metres. The deposits are covered by five prospecting blocks of the Mpahlane, Mnyameni, Kwanyane, Sikombe, Mtentu rivers.
Mineral Commodities, however, does not foresee any problems, saying it has excluded environmentally sensitive areas and confined its activities to the grasslands and dune sands that lie immediately inland of the coastal vegetation.
In its annual report, the company says: "The tenement contains areas which are totally void of vegetation and are prone to wind and water erosion, resulting in extensive blowout of the dunes.
"The movement of the sand is threatening adjoining rivers and estuaries. The disturbances lie within the proposed mine path and can be successfully rehabilitated after mining," it said.
The company believes it will be able to demonstrate that the mining project can be developed and operate within acceptable environmental criteria.
At the end of last year, it upped its 49% stake to 75% in Transworld Energy & Minerals Resources SA, the company that owns the prospecting permit, after spending 1m on the project.
It has already completed a prefeasibility study, and an extensive drilling programme in the Sikombe, Kwanyana and Mnyameni blocks between July and October last year.
The board of directors are confident they will get approval for development this year and they expect to generate about $77m annually.
The minerals and energy department maintains that the mining development is consistent with government's initiatives to provide social and economic upliftment to black communities.
But, Johann Kotze from the environmental affairs and tourism department is certain any industrial development will "ruin the sense of the place".
He says mining will affect the actual coastline, estuaries, waterfalls, equatorial forests, ecological faults and the endemic flora which are unique only to the Wild Coast area.
"There is tremendous potential in the Wild Coast, which is highly conducive for ecotourism development. This is a good opportunity for SA to position itself as a responsible global ecotourism destination."
Kotze suggests that the company make efforts to harmonise its development with tourism needs.
"One must go about development responsibly and realistically or else this beautiful, scenic area will be lost."
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