Government, labour and business need to restore mutual trust through transparent and honest engagement, with the annual Joburg Indaba mining conference providing an ideal platform through which to forge a way forward in this endeavour, says mining and industrial services provider Fraser Alexander business development senior manager Emmanuel Ngubane.
“There will surely be tragic consequences for the local mining industry should stakeholders not be able to attain a meeting of the minds and find their common purpose. South Africa has always been able to correct its flaws and establish its sense of direction, but this is only possible through true collaboration. The Joburg Indaba encourages the South African mining industry to participate in robust discussions about the challenges it faces, review its current state and solicit commentary from all affected stakeholders.”
Ngubane notes that the South African mining sector continues to be affected by subdued commodities demand, increased cost pressures and the tension between miners and regulatory bodies, owing to ongoing policy uncertainty. He adds that this growing trust deficit between the South African government and the business sector is resulting in negative sentiments between the two parties, which, critically, is deterring foreign direct investment.
“The new cost benchmarks that have been established by the resurgence of new labour unions further reduce mine profitability and, ultimately, impact on shareholder returns. The looming economic downgrade of the country is also doing nothing to encourage investors, especially in terms of funding mining exploration.”
He notes that South Africa is, moreover, at a crossroads as far as fast-tracking decisions on mechanisation within the gold and platinum-group metals sectors goes, which is seen by many as a fundamental step in ensuring the sustainability of South Africa’s key mineral sectors and potentially having a positive influence on the country’s gross domestic product. In coal and chrome, there is also increasing participation of emerging miners, owing to transformation-related regulations, which have effected offtake agreements.
Meanwhile, Fraser Alexander Southern African Development Community (SADC) business development senior manager Harvey Nkosi points out that depressed short-term commodity prices remain a concern for the development of resources and infrastructure across the SADC region. He adds that most SADC countries are overreliant on South Africa and China for their supply of skills, equipment and critical spares, which has led governments in neighbouring countries, such as Namibia, Botswana and Mozambique, to rapidly firm up their stance on industry localisation for the benefit of their citizens.
Alongside turbulent political currents, Ngubane notes that technical shifts are also apparent, with water shortages becoming a significant problem for mines in Africa and leading to a rise of interest in dry processing technologies. As energy continues to be a key cost challenge, miners are also turning to renewable- energy sources and increasing automation in their operations to improve the efficiency of energy consumption. The migration from underground mining to predominantly opencast mining methods – driven by cost pressures – is also complemented by a focus on downstream beneficiation technologies for smelting, refining and trading to enhance value.
Nkosi adds that the steady and widespread adoption of international best practice guidelines for tailings and mine waste management is also a prevailing trend in the SADC region, influencing the design, operation, closure and rehabilitation of mining waste disposal sites. Remote operation and the monitoring of mobile equipment on mining sites are also key disruptors in the mining sector and are having a significant impact on mine safety and productivity.
A Forum for Advancement
“All these shifts mean that industry players in the African mining sector need to adapt their business models to meet new requirements. “Companies are increasingly seeking collaborative solutions that can reduce total cost of ownership and operation and there is a growing expectation that all stakeholders should share the risks associated with a mining project,” says Ngubane.
He stresses that the Joburg Indaba 2017, which will take place at the Inanda Club, in Sandton, Johannesburg, from October 4 to 5, presents an opportunity for parties from various sectors to gain insight into each other’s perspectives on common problems and focus on finding solutions. For Fraser Alexander, it, moreover, provides a cost- effective platform for networking with existing and prospective clients, and enables the company to showcase its ability to contribute towards the success of the industry through innovative and technologically advanced solutions. From a SADC mining development viewpoint, Nkosi adds, the Joburg Indaba is key for promoting investment, as the event hits at the core of economic growth for the region by providing insights into many factors, including movements in project funding instruments.
Fraser Alexander acting CEO Keith Scott will talk at the event, highlighting the significant transformation the company has undergone to enable it to introduce a total service offering that can add value to its clients’ operations and help them achieve growth in a challenging economic climate. Scott’s presentation will also aim to highlight the versatility of the Fraser Alexander brand through its ability to collaborate with various stakeholders across the full mining value chain.