HomeBusiness and policyAustralian companies remain hungry for African opportunities says AAMEG

Australian companies remain hungry for African opportunities says AAMEG

With a number of its members already successfully operating in Africa’s resource-rich mining sector, the Australia-Africa Minerals & Energy Group (AAMEG), says that Australian companies remain hungry for the opportunities that Africa has to offer.

While CEO WILLIAM WITHAM believes huge opportunities abound, he doesn’t shy away from admitting that operating in Africa is not without its challenges writes CHANTELLE KOTZE.

Having taken to the helm of the AAMEG in January 2018, succeeding former CEO Trish O’Reilly, Witham brought with him a wealth of experience, spanning corporate leadership in resource development in Africa, senior roles in resource sector representative bodies and direct experience in government lobbying and negotiating.

This article first appeared in Mining Review Africa Issue 7, 2019
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Having held senior executive roles across the Australian and African resources sector for over two decades working in Namibia, Botswana, Cameroon, Congo, Gabon, Egypt, Niger and Kenya, Witham has a keen understanding of how to support and enable Australian companies to operate successfully in Africa.

One of his primary tasks within the AAMEG is to help its members better understand and more effectively and efficiently manage some of Africa’s inherent operational risks, including political and social risks, health and security, as well as bribery and corruption.

“Africa and Australia have a lot to offer one another,” says Witham, noting that this opens the door to unlocking synergies between the two continents. It is AAMEG’s role to foster this collaboration and engagement between industry, governments and other stakeholders in Australia and Africa – and the organisation takes this role very seriously.

With a rich history in pegging, prospecting and regional exploration, which has fostered a strong junior mining sector, Australia has developed several strong exploration techniques that have been transferred over to Africa by the many exploration companies and service providers active on the continent.

On the other hand, South Africa has a long history in developing large, deep mines – which could be of benefit to the Australian mining sector, says Witham.

The need for transparent exploration is critical

Witham notes the need in Africa to make the resources in the ground easier to find, section, and manage. He believes that doing so will support exploration endeavours in the continent.

Australia’s mineral resources are owned by the state which means that everyone has equal access to minerals. This means that there is a good collection of historical resource data available, and when the ground is given up, the data is freely available to anyone via the internet.

This enables people to see the work that has already been carried out on the ground so to not redo the same exploration work, in turn enabling each exploration programmes to advance, Witham explains.

In contrast to this, there is a real struggle around access to resource data in Africa, which is not conducive to a free and open exploration industry.

In South Africa for example, the transition in ownership of mineral rights from individual land owners to the government is a good first step, says Witham, noting that the transparency of historical mineral data is critical in moving exploration forward.

The country’s online cadastre system – the South African Mineral Resources Administration System (SAMRAD) – which was aimed at fostering an increased tempo of exploration in South Africa by ending the long administrative delays when applying for exploration rights and mining permits, has however been criticised as being a far cry from the cadastres of other African mining jurisdictions.

Witham’s thoughts around the need for a transparent mineral resource database was echoed by South Africa’s junior mining sector at the Junior Indaba, which also called for a more transparent cadastre system in the country with freely available geological information, as key to fostering a stronger exploration industry in the country.

The funding gap and how to deal with that

Witham admits that while raising funds has become harder, with even greater competition for investment in the resource sector, compounded by rising costs and compliance requirements, there is a general consensus in the industry that investors are cautiously optimistic and willing to invest. This willingness to invest is however often impacted by policy certainty and country risks.

In addition to this, which is often out of the industry’s control, Witham notes that “knowing how to operate in Africa, reveals the continents’ great geology and grades,” and that the complex nature of doing business in the developing economies of Africa cannot be underestimated. 

While Australian companies have the necessary technical know-how to run a successful exploration programme, it is often the operation risks that Africa presents, in terms of political and social risks, health, security, human rights; and bribery and corruption, that Australian companies need to be made aware of.

“Understanding these are crucial to developing successful operations in Africa,” Witham concludes.

Chantelle Kotze
Chantelle Kotze is a Johannesburg-based media professional. She is a contributor at Mining Review Africa (Clarion Events - Africa) and has created content for the media brand over the past 6 years.