ASX- and JSE-listed coal miner MC Mining has denied allegations of illegal mining activities and the suspension of environmental authorisation (EA) at its Makhado Colliery, in Limpopo, assuring shareholders that it is operating in the area with approved licensing in place and within South Africa’s legal framework.

Political party the Democratic Alliance (DA) on August 22 urged the Department of Mineral and Petroleum Resources to take urgent action against alleged illegal mining in what is a biodiversity hotspot in northern Limpopo.

The party also said the project’s EA was under appeal.

In response, MC Mining said several groups had opposed mining in the area and lodged appeals with relevant authorities, which were all considered and dismissed.

The company said its subsidiary, Baobab Mining and Exploration, had lawfully executed activities such as clearing of vegetation and expansion of the road at the Makhado project since June 2021, in accordance with its approved EA.

Moreover, MC Mining also assured that it had adequate financial provision for rehabilitation and closure of Makhado, with relevant guarantees in place, as per the Mineral and Petroleum Resource Development Act and the National Environmental Management Act.

“We subscribe to the principles of environmental stewardship and sustainability. MC Mining conducts its mining activities within the prescripts of the National Forests Act and legally required permits are in place and valid,” the company stated.

The coal miner added that baseless allegations only served to discourage much-needed investment for job creation and economic growth in the country.

MC Mining ultimately denied that illegal mining activities were taking place and said it remained focused on commissioning Makhado within the necessary regulatory frameworks and cooperating in any investigations.

In its letter to Mineral and Petroleum Resources Minister Gwede Mantashe, the DA said MC Mining had a history of environmental noncompliance, including a R9-million fine at its Vele Colliery for the same offences as alleged with Makhado – operating without an EA.

The DA also claimed that MC Mining’s financial statements showed short-term asset cover for only 8% of its liabilities, placing it near insolvency. Should the company collapse, taxpayers would be liable for Makhado’s rehabilitation costs, it said.

DA spokesperson for Forestry, Fisheries and the Environment Andrew de Blocq said the DA supported lawful, sustainable development and not environmental destruction for narrow foreign interests.