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Council sees potential in coal exports

15th March 2019

     

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In its 2018 facts and figures pocketbook published last month, Minerals Council South Africa notes that South Africa has a yearly coal export potential of 110-million tons, compared with the 75-million tons currently being exported.

This would not only increase investment by more than 10% to about R20-billion, but would carry with it the potential to increase employment in the sector by 11 600 people.

With almost 89 000 direct employees at the moment accruing about R24.7-billion in earnings, the sector carries with it the prospect of an upturn despite the industry receiving the attention of environment lobbyists.

Coal is the largest component of mining by sales value and is a critically important source of primary energy – electricity and liquid fuels – that drives the South African economy.

The council welcomed the statements made by South Africa President Cyril Ramaphosa, during his address at the Investing in African Mining Indaba held at the Cape Town International Convention Centre in Cape Town last month.

Throughout his address, Ramaphosa echoed the sentiments of Mineral Resources Minister Gwede Mantashe, assuring stakeholders of government’s commitment to creating an enabling environment for investment in mining, which would ultimately lead to a thriving mining industry for the benefit of all South Africans.

This will help mitigate a good percentage of the challenges which are faced by the coal industry at the moment.

Investment in projects, such as the recently confirmed Overvaal coal link tunnel being commissioned by State-owned rail company Transnet Freight Rail, as well as investment and exploitation of the Waterberg reserves would be most beneficial, highlights the council.

It adds that poor policy cohesion, such as shown by larger utility providers and the lack of a predictable pro-growth environment, needs to be addressed as well. The Minerals Council adds that challenges within local government structures and communities demanding services from mining companies, which are in fact in the remit of local government, need to be adequately addressed.

The council notes the assurance provided by the President that government will not let electricity utility Eskom fail, and looks forward to the imminent announcement of a package of measures to stabilise and improve Eskom’s financial, operational and structural position and to ensure security of energy supply for the country.

The council also welcomes government’s commitment to address infrastructure constraints that limit mining and processing, including port, rail and electricity.

It is believed that a collaboration between all parties is needed to ensure that the mining industry reaches its full potential and realises its role in the development of the South African economy.

The Mining Leadership Compact, signed on Monday, February 4, commits all the parties to play their parts in working cooperatively and according to high standards of good governance to make South Africa a competitive mining destination.

“We have engaged extensively with government and other stakeholders on the challenges that have prevented mining from reaching its true potential,” says Minerals Council South Africa CEO Roger Baxter. He asserts that a collaborative approach is needed to develop and implement solutions that will see South Africa’s industry grow and thrive in the future for the benefit of all.

“We need to get investment back in mining. We, as the industry, are fully committed to play our part,” concludes Baxter.

Edited by Zandile Mavuso
Creamer Media Senior Deputy Editor: Features

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