South African Business 2018 edition

OVERVIEW
tive, working better with the
communities in which it operates.
New CEO, Mxolisi Mgojo,
is simultaneously leading his
company, Exxaro Resources, on
a programme to make mining
sustainable through measures
such as water sharing with local
communities and finding ways
to help communities gain access
to energy.
The national government’s
Phakisa programme is also to be
applied to mining. Intended to
fast-track solutions to development
problems, an Operation
Mining Phakisa Lab has been set
up to create concrete plans.
Another significant change in
the South African mining landscape
was the decision of Anglo
American to focus on three
minerals: copper, platinum and
diamonds. Although Anglo has
not begun a wholesale sell-off of
coal, manganese and platinum
assets (because rising prices have
made some mines very profitable
again), sales have begun. The
first move came in April 2017
with the sale of Anglo’s thermal
coal operations to Seriti, a blackowned
company lead by Mike
Teke, the outgoing president of
the Chamber of Mines.
Seriti paid R2.3-billion for the
New Vaal, New Denmark and Kriel
collieries as well as four closed
collieries. Seriti thus became the
second-largest provider of thermal
coal to Eskom.
The other big supplier to
Eskom is Exxaro, which supplies
about 33-million tons. Exxaro’s
recent purchase of Total Coal
South Africa (TCSA) took to six
the number of mines the company
has in Mpumalanga. Exxaro’s Grootgeluk mine in Limpopo is a
huge operation and gives the company a presence in the Waterberg
area, where an estimated 40% of South Africa’s coal reserves lie. This
amounts to about 75-billion tons of coal, but to get that coal to the
coast for export would mean a rail extension of 464km at a cost of
R37-billion. Transnet Freight Rail (TFR) is conducting a feasibility study.
Assets
South Africa has huge reserves of platinum and chrome and produces
about 40% of the world’s vanadium and vermiculite. The country has
large reserves of ilmenite, palladium, rutile and zirconium and 80% of
the world’s known manganese reserves are located in the Northern
Cape Province. South Africa also produces 75% of the world’s platinum
and 73% of its chrome.
Despite uncertainty on the global market, Northam Platinum has
continued to buy assets. In 2015 it bought Everest South in Limpopo
from Aquarius, a move that will allow it to consolidate operations at
its adjacent property, Booysendal South. Northam, which also has
assets in the North West province, aims to produce 850 000oz of
PMGs from 2022.
A court ruling in February 2017 has opened the way for Ivanhoe to
build its Platreef Project on the northern limb of the Bushveld Igneous
Complex. R70-million has been committed to the first phase. If the
mine achieves the projected production rate of 12 Mtpa with 1.2-million
ounces of PMG, it will rank as the biggest PGM mine in the world.
Amplats and Lonmin are trying to reduce costs. Amplats has sold
its Rustenburg operations to Sibanye and Lonmin has put some shafts
that are expensive to run on care and maintenance.
With a depressed platinum price, platinum miners are hoping that
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