South Africa needs stability, continuity and fairness in the mining industry, says engineering consultant WSP Africa transport and infrastructure division MD Dr Terence Milne, who tells Mining Weekly that presenters at the Investing in African Mining Indaba highlighted “political stability, fair charters and fair royalties” as requirements for mining growth.
While Milne notes that recent political changes in South Africa may positively affect investor confidence, he emphasises the need for stability, which is hindered by the uncertainty caused by the Mining Charter III.
“Mining requires huge investments over long periods and investors want stability and predictable outcomes.”
Since its publication in June last year, the charter has been a contentious issue, causing a lack of trust among key industry stakeholders, while an interdict application to suspend its implementation and a review application to set it aside, have been lodged by the Chamber of Mines. The application for the review of the 2017 Reviewed Mining Charter was, however, postponed last month.
Milne believes that an economically viable future for mining lies in the hands of Mineral Resources Minister Mosebenzi Zwane. “If the Mining Charter is not workable, South Africa is not going to get the desired and much-needed investments to grow the sector, which it requires if the sector is to continue to meaningfully contribute to economic and gross domestic product growth in the country. “The mining sector and the country, alike, are at a pinnacle time for change, where taking a hard line could be shortsighted and impede efforts to effect positive change.”
However, there is hope for South Africa, with the country entering an “exciting political time”, says Milne. He recounts that there was great optimism about the change in the local political climate evident at the Investing in African Mining Indaba, which stimulated a lot of thought and “honest talking” on key issues in the mining industry.
Milne further underscores a “vast opportunity for engineering firms to contribute, from the development of small mines to the pit-to-port operations of the majors”.
He says the technical competence and capability is available within Africa to plan, construct and operate optimum infrastructure solutions. “However, a multifaceted approach that adequately engages all stakeholders on their respective needs – in the most mutually beneficial and transparent manner – and seeks improved cooperation would see significant strides taken in moving towards optimal infrastructure investment and operation,” Milne adds.
Opportunity and Sustainability
Milne says the biggest opportunities for growth in the mining industry in general lie in burgeoning environment-friendly activities and related commodities, such as copper, platinum and cobalt, which are required for electric vehicles (EV).
There is exponential growth in the demand for battery metals amid the EV market growth, and this will drive exploration and investment in Africa. EVs are driving the demand for cobalt and copper.
Further, Milne explains that investors would rather invest in mining companies whose mining activities are environment friendly, noting that, as technology advances, environment-friendly mining will become more prominent.
He also points out that mining companies should improve the communities in which they are mining to promote a sustainable future, explaining that companies can, for example, use green energy and put that same energy back into the grids of the countries where they operate.
“Mining companies should enhance electricity and water supply in the communities where they work and foster economic growth.”
WSP’s plans for the year ahead include exploring hybrid energy solutions that include renewable-energy solutions at mine sites, as well as exploring how it can apply its engineering capabilities to match the needs of junior miners.
The company will also consider how it can become involved in assisting junior miners with greener mining.
“WSP’s focus will be on embracing and facilitating clean energy for mining, and turning the liabilities of mining into assets that can help the communities in which the mines operate,” Milne concludes.