Land owners are now responsible for acid mine drainage (AMD) after the land has been sold.

The Constitutional Court recently made the ruling after it dismissed an application by Harmony Gold. The application was for leave to appeal against the Supreme Court of Appeal’s judgement that the company remained liable for the cost of pumping and treating AMD despite the fact that it no longer owns or mines the land.

The Supreme Court of Appeal held that a directive issued under the National Water Act regarding the pumping and treatment of AMD remained binding on the owner of land after it had sold the land, notwithstanding the fact that a new entity now mines that area but does not contribute to the costs of pumping and treating. The gold producer argued that the plain text of the National Water Act does not permit that interpretation.

“The net effect of this is that mining companies, which are the recipients of directives may, depending on their terms, remain liable for the costs of remediation including the pumping and treatment of groundwater even if they are no longer mining there,” explains, Director and Environmental Practice National Head at Cliffe Dekker Hofmeyr, Terry Winstanley.

She says the Constitutional Court’s decision will potentially have significant implications for the mining industry.