NO MORE GHOST TOWNS

The report examines the systemic failure of mine closure and rehabilitation in Mpumalanga, South Africa, highlighting a dangerous reliance on third-party financial guarantees over ring-fenced cash. It identifies a significant gap where older mining rights are exempt from stricter 2015 financial provisioning regulations and notes that large-scale mines rarely receive formal closure certificates. Through a PAIA information request, the report reveals that the Department of Mineral and Petroleum Resources (DMPR) lacks a system to verify if provided funds are sufficient for actual rehabilitation costs. It concludes with recommendations for a regional closure framework, mandatory proactive disclosure of environmental data, and a shift toward rehabilitation trust funds to protect the public from inheriting environmental liabilities.

• South Africa has an estimated 6,100 abandoned and derelict mines, with a significant lack of formal closure in the coal sector; in Mpumalanga, no closure certificates for coal mines were issued between 2011 and 2016.
• Financial provision for mine rehabilitation relies almost entirely on bank and insurance guarantees rather than ring-fenced cash or trust funds, exposing the state to risk if guarantors become insolvent.
• The liquidation of Constantia Insurance in 2022 illustrated the risk of guarantee-based provisioning, as the company had issued approximately R45.5 million in guarantees for mines in Mpumalanga.
• A regulatory gap exists where the 2015 Financial Provisioning Regulations are not applied to older mining rights due to repeated extensions of transitional arrangements, leaving many end-of-life mines under weaker standards.
• The 'One Environmental System' creates an institutional conflict of interest because the DMPR is responsible for both promoting the mining industry and overseeing its environmental impacts.
• Access to environmental and financial information is severely restricted, with the DMPR treating financial provision data as confidential and PAIA requests often resulting in delayed or incomplete responses.
• Analysis of closure certificates shows a systemic imbalance where the majority are granted to small-scale or prospecting sites, while large-scale mines with the highest environmental liabilities rarely achieve formal closure.
• The DMPR has failed to systematically verify whether the financial provisions lodged by mining companies are sufficient to cover the actual costs of rehabilitation.
• The case of the Imbabala Mine in Ermelo demonstrates the human cost of regulatory failure, where an abandoned site has led to child deaths in open pits and water contamination.

APA

Mugunyani, T. (2026). NO MORE GHOST TOWNS. Centre for Environmental Rights. https://cer.org.za/wp-content/uploads/2026/05/NoMoreGhostTownsDIGITAL.pdf?x21779

Chicago

Mugunyani, Tarisai. NO MORE GHOST TOWNS. Centre for Environmental Rights, 2026. https://cer.org.za/wp-content/uploads/2026/05/NoMoreGhostTownsDIGITAL.pdf?x21779.

Wikipedia

{{cite report |last1=Mugunyani |first1=Tarisai |title=NO MORE GHOST TOWNS |publisher=Centre for Environmental Rights |date=2 May 2026 |url=https://cer.org.za/wp-content/uploads/2026/05/NoMoreGhostTownsDIGITAL.pdf?x21779 |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{mugunyani2026more, author = {Mugunyani, Tarisai}, title = {{NO MORE GHOST TOWNS}}, institution = {Centre for Environmental Rights}, year = {2026}, month = may, url = {https://cer.org.za/wp-content/uploads/2026/05/NoMoreGhostTownsDIGITAL.pdf?x21779}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }