Managing Natural Resources Revenue Experience of Malaysia
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1 Managing Natural Resources Revenue Experience of Malaysia NURUL HUDA BIN ROMLI Principal Assistant Director Minerals Economic Section Minerals and Geoscience Department, Malaysia (MGD) FINANCING FOR THE SUSTAINABLE DEVELOPMENT GOALS WORKSHOP 7-8 DECEMBER 2016 BANGKOK, THAILAND
2 INTRODUCTION The National Mineral Policy (NMP) was first formulated in 1993 with assistance from UNDP to improve the mineral sector investment environment. NMP achieved some milestone but does not quite able to attract investors. Thus after a decade, the NMP was reviewed to ensure the implementation of sustainable development and optimum utilisation of mineral resources, and to promote environmental stewardship that will ensure the nation s mineral resources are developed in an environmentally sound, responsible and sustainable manner. The NMP2 was tabled at the National Mineral Council in 2008 and accepted by all the States. It was officially launched by the Minister of NRE on 9 January 2009.
3 NATIONAL MINERAL POLICY 2 Policy Statement Launching of DMN2 by the Minister of Natural Resources & Environment on 22 January 2009 To enhance the contribution of the mineral sector to the socioeconomic development of the nation through the efficient, responsible and sustainable development as well as the optimum utilisation of mineral resources.
4 Objectives Thrusts 1. To ensure the sustainable development and optimum utilization of mineral resources. 2. To promote environmental stewardship that will ensure the nation s mineral resources are developed in an environmentally sound, responsible and sustainable manner. 3. To enhance the mineral sector s competitiveness and advancement in the global arena. 4. To enhance the use of local minerals and promote the further development of mineral-based products. 5. To encourage the recovery, recycling and reuse of metals and minerals. The National Mineral Policy 2 is supported by nine (9) major thrusts and 46 programs: Thrust 1: Expansion of the Mineral Sector (7 programs) Thrust 2: Conducive Business Climate (6 programs) Thrust 3: Environmental Stewardship (8 programs) Thrust 4: Research and Development (R&D) Enhancement (5 programs) Thrust 5: Human Resource Development (5 programs) Thrust 6: Establishment of Integrated Mineral Information (3 programs) Thrust 7: Community Involvement and Social Responsibility (5 programs) Thrust 8: Promotion, Marketing and Branding (4 programs) Thrust 9: Publicity and Public Relations (3 programs)
5 LEGISLATIONS State Mineral Enactment : - State Legislation - issuance of prospecting or exploration licences and mining leases, fees and mineral royalties - administered by the State Lands and Mines Director Mineral Development Act 1994 : - Federal Legislation - operational, environmental and safety aspects of exploration and mining operations - administered by the State Director of Minerals and Geoscience Department (on behalf of the Director-General of Minerals and Geoscience) - Operational Mining Scheme approval by the State Director of Mines. The State Mineral Enactments and Mineral Development Act 1994 can be downloaded from the Department of Minerals and Geoscience Malaysia website at jmg.gov.my
6 STATE MINERAL ENACTMENT Has a number of distinguishing features: One-stop center, for all prospecting licence, exploration licence, mining lease applications State Mineral Resources Committee, to vet and coordinate processing of applications and submission of recommendation to the State Authority for decision Environmental Consideration Requires approval of Rehabilitation Plan and Environmental Impact Assessment before the mine is allowed to operate and must comply to environmental standards Rehabilitation of the land Mining lease holders are required to progressively rehabilitate the site Smale scale operation contribute to Common Rehabilitation Fund for rehabilitation purposes as decided by Government Large scale mine contribute to Mine Rehabilitation Fund for progressive rehabilitation as decided by the miner Propriety Mining Licence Allow the owner of a agricultural land to mine his land without changing the land status
7 STATE MINERAL ENACTMENT Security of tenure Duration of mining lease is based on the economic life but not exceed 21 years and renewable Confidentiality of Prospecting or Exploration Data Prospecting or exploration information are kept confidential for a specific period of time, except with the written consent of the owner Mining beneath alienated land State authority can give permission to mine mineral deposits beneath alienated land subjected to surface rights Royalties or other Financial provision Royalty on any minerals based on % market value (5-20%) Weight or volume of the mineral produced Holding fees for prospecting or exploration licences Annual rental on mining leases And other fees
8 MINERAL DEVELOPMENT ACT Provides the inspection & regulation of exploration and mining of minerals Ensures exploration & mining activities are carried out with good and safe practices, and complies environmental standard Ensures mining activities does not jeopardize the safety and health of any person and cause damage to any properties Regulations made under the Act Operational Mining Scheme, Records and Plans Regulations Safety in Exploration and Surface Mining Regulations Blasting Regulations Mine Effluent Regulations Mineral and Mineral Ore Licencing Mineral Processing Underground Mine Safety and Underground Coal Mine Compound (Note: A holder of a mining lease or proprietary mining licence cannot start any development work or begin mining operation until the Operational Mining Scheme (submitted by a mining consultant) has been approved by the State Director of DMG)
9 SUMMARY Resources: Malaysia have ample mineral resources. Policy: Set goals for the future taking into consideration the sustainable development of mineral resources Legislations SME brings greater uniformity in the issuance of mineral tenements in all the States MDA ensures safe, environmental friendly and sustainable mineral industry
10 Sunway Lagoon Resort, Kuala Lumpur The Mines Hotel and Resort, Kuala Lumpur THANK YOU Lake Titiwangsa, Kuala Lumpur (mining rehabilitated area) Fraser s Hill Golf Course, Pahang State
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