Mineral and Petroleum Resources Minister Gwede Mantashe has defended South Africa’s continued investment in oil, gas and mining development, warning Parliament that global instability and energy insecurity posed a direct threat to the country’s economic recovery.

Tabling Budget Vote 34 for the Department of Mineral and Petroleum Resources (DMPR) in Parliament on Tuesday, Mantashe announced that the department had been allocated R2.86 billion for the 2026/27 financial year to support mining regulation, exploration, rehabilitation projects and petroleum development initiatives.

Addressing Members of Parliament (MPs) in Cape Town, Mantashe said South Africa could not afford to remain vulnerable to global fuel supply disruptions while possessing significant mineral and petroleum resources of its own.

“We cannot stand on the sidelines and be passive observers,” Mantashe said.

“This budget is our strategic response to these geopolitical realities, a commitment to protecting the livelihoods of our people, securing our energy future, and anchoring our economy against the rising tides of international instability and price volatility.”

Mantashe said conflict in the Middle East had destabilised global energy supply chains and exposed South Africa’s dependence on imported refined petroleum products.

Although the government introduced temporary fuel levy relief measures from April to June to cushion consumers against rising fuel costs, he admitted the intervention was not a long-term solution.

“It is neither sustainable nor just for a country with significant mineral and petroleum potential, such as ours, to remain exposed to external supply shocks in this manner,” he said.

The minister used the budget speech to strongly defend the government’s push to expand the country’s upstream petroleum industry and refining capacity despite criticism from environmental lobby groups.

“This is precisely why our sustained focus on developing the Upstream Petroleum Industry and expanding our refining capacity remains correct,” he said.

“The fact remains that petroleum security is not a theoretical debate, but an economic necessity and a national imperative.”

Mantashe also called for the acceleration of the South African National Petroleum Company Bill, which seeks to establish a state-owned petroleum company aimed at increasing state participation in the oil and gas sector.

Despite global uncertainty, the minister said South Africa’s mining industry continued to show resilience and remained a major contributor to the economy.

According to Mantashe, the mining sector’s Gross Value Add reached R477 billion in 2025, contributing approximately 6.3% to the country’s Gross Domestic Product.

Mining royalties collected by the state increased to R11.8 billion in 2025, up from R10.6 billion in 2024.

He attributed the sector’s growth to strong iron ore and manganese exports, improved commodity prices and solid performance during much of the year.

However, Mantashe warned that rising electricity tariffs continued to place severe pressure on mining companies, particularly deep-level gold and platinum group metal operations.

The minister also declared that the government was moving aggressively to position South Africa as a major player in the global critical minerals market.

“We have moved decisively from blueprint to battlefield,” Mantashe said.

“We are transforming our mineral endowment into a catalyst for industrialisation, investment, and economic growth.”

A major focus of the strategy is expanding geoscience mapping to attract exploration investment. Through the Council for Geoscience, the government has increased national onshore geological mapping coverage from below 5% in 2019 to 20% in the 2025/26 financial year.

Mantashe said the recently launched Virtual Core Library, unveiled during this year’s Mining Indaba, would help unlock value from South Africa’s geological assets by providing accessible geoscientific data to investors and researchers.

Government is also increasing funding support for emerging miners through the Junior Mining Exploration Fund, which was initially capitalised at R400 million by the department and the Industrial Development Corporation.

Mantashe revealed that 13 exploration projects were already underway, including projects in Bothaville in the Free State targeting rare earth minerals and another in Giyani focusing on copper, nickel and gold.

The minister further announced that mining giant Anglo American had pledged R600 million towards the exploration fund, increasing its value to R1 billion.

In addition, the Public Investment Corporation had committed R1.35 billion for exploration activities through what Mantashe described as a “Continuation Fund” to support projects emerging from the Junior Mining Exploration Fund pipeline.

On mine safety, Mantashe said South Africa recorded a historic low of 41 mining fatalities in 2025, although he warned that the gold sector remained a concern.

While fatalities in coal and platinum mines declined significantly, the minister said recent accidents, including the Ekapa disaster that claimed five lives, demonstrated that serious risks remained within the industry.

“Complacency has no place in this industry,” he warned.

Mantashe also outlined several allocations within the department’s budget, including R666.9 million for the Council for Geoscience, R328.7 million for Mintek, R140.87 million for the rehabilitation of derelict and ownerless mines, and R48.1 million for the implementation of the Shale Gas Project.

He concluded by thanking Deputy Minister Phumzile Mgcina, the department’s leadership and stakeholders in the mining and petroleum sectors for their support.