Every Friday morning, SAfm’s AMLive’s radio anchor Xolani Gwala speaks to Martin Creamer, publishing editor of Engineering News and Mining Weekly.  Reported here is this Friday’s At the Coalface transcript:

Gwala: The US’s new clean-energy centre in Johannesburg is a shot in the arm for renewable energy in Africa.

Creamer: Yes, the big problem is getting the renewable energy projects from conceptual stage through the financing gap. Now the Americans have come through with both finance and technical help. 

So, this is situated in Johannesburg, but also looking right through to subsequent sub-Sahara Africa, big and small wind, sun, energy and water projects, anything that is renewable. 

There is an initial moderate $20-million available for project preparation, but the expectation is that they will be able to unlock well over $1-billion for these renewable energy projects, which will fit in line with the policy of President Barrack Obama, who wants to see clean-energy technology rolled out in Africa, with the participation of America. 

The particular centre that is being developed here in South Africa is really a joint venture of three developmental agencies from the United States working together to give them collective strength.  They will also be participating and looking towards South Africa’s own REIPP, which has been very successful this renewable energy project, which involves the independent power producers. 

This particular programme, which is being done by the South African government and Eskom, which is the buyer of the power, is seen as a great unlocker of private sector balance sheets for what is really public infrastructure. 

The first window was quite successful unlocking R47-billion for many projects in the renewable space and now other bid windows are coming forward and the centre from the United States, the US Africa Clean Energy Development and Finance Centre, is looking to participate.

Gwala: The production lines for South Africa’s joint missile project with Brazil are beginning to take shape.

Creamer: Brazilians and South Africans are working together on the A-Darter air-to-air missile.  This is a product of South Africa but the fifth-generation version of this air-to-air missile is going to be jointly owned by South Africans and Brazilians. 

They will have production lines in South Africa and Brazil.  We see that Denel, which is the State-owned company in South Africa, with Denel Dynamics in particular, has already formed a Brazilian company, Denel do Brasil.  They are looking to work within a new industrial hub to set up this production line. 

The South African production line is likely to come into being ahead of the Brazilian one.  The expectation is that in South Africa we have our production line this year, whereas the Brazilians are looking to probably 2015. 

Working together on this air-to-air missile, they see it as a highly agile lightweight missile of a modern version that can lock on to targets even out of the range of its infrared capabilities.

An exciting technology and Brazil and South Africa’s joint defence committee already met in Brasilia, setting up the framework for a long-term relationship, because this could be the first of other defence products that are built together, by South Africa and Brazil.

Gwala: The confirmation of coking coal at Makhado is another boost for the Limpopo province.

Creamer: Coking coal is not just like the normal energy coal, the thermal coal, that we burn by the ton to keep our lights on here.  You get a much better price for the hard coking coal in particular. 

This is what has been confirmed by the independent coal consultant, Wood McKenzie, which has confirmed that Limpopo province has the potential to be a world-class hard coking-coal producer. 

That means a price premium and also if we work together in Southern Africa here, because not only is there hard coking coal in Limpopo, as we see now, there is a potential for some 10 largish mines there, but there is also coking coal in Mozambique and Zimbabwe. 

If we work together, they are estimating that in 10 years we could be producing, from this region, about 50-million tons, which would fetch well over R100-billion a year. It is quite an incentive to get going.

Already the Johannesburg Stock Exchange-listed Coal of Africa, a junior player, which is becoming a mid-tier producer, is looking to about 10-million tons of coking coal in the next ten years.  It is the leading player now that Rio Tinto moved out of the area and they bought up a lot of Rio Tinto’s assets in the Soutpansberg. 

In Mozambique, Rio Tinto had to write off quite a lot of its hard coking coal asset value, $3-billion worth, which helps South Africa. 

It gives again a boost to this Limpopo, which already is having a R20-billion injected into it by the diamond producer De Beers and, of course, with the big Medupi power station there, we are talking about, with the coal mine investments there, well over R100-billion being put into the province.  

Activity there and the focal point around hard coking coal, which fetches better prices, will be exported via Maputo.

Transnet will have to come to the party with a competitive rail tariff.  

Gwala: Thanks very much. Martin Creamer is publishing editor of Engineering News and Mining Weekly, he’ll be back with us at the same time next week.