All parties must co-operate for success

What a period it’s been in the mining industry – globally and at home! Quite possibly not that much different from any other time; nevertheless, when one finally takes a moment to pause and reflect, one cannot help but marvel at the contradictory nature of events in our sector, rising to great heights today, toppling into the depths of depression tomorrow, and popping back up to the lofty levels of optimism the day after.

Someone’s doing something right!

I’ve just been through a most interesting and rewarding exercise of chatting independently, and at some length, with Randgold chief executive Mark Bristow and four of his “generals” responsible for the development of the company’s mines from the first stroke of a pen authorising exploration to the final thumbs up when “the wheels begin to turn.” Quite a journey I assure you, as you will discover if you read the company profile in this issue.

Africa’s rewards have to be earned

In the final week of August all roads lead to West Australia, where one of the major international conferences and exhibitions focusing on mining in Africa – “Africa Down Under” – takes place in the city of Perth. A forum like this – the biggest African resources event outside the African continent – plays a key role in generating foreign interest in Africa as a destination for foreign investment.

Three strikes and you’re out

Difficult times face South Africa’s economy. ‘Three strikes and you’re out’ is the call in baseball. South Africa’s mining industry has had three strikes and then some more and, now, the world market is taking note of, and acting in response to, this state of ongoing uncertainty.

Of gold and tin and high-cost operations

For mining investors, there are still some great projects in Africa, which are, at the moment, undervalued. Two weeks ago, I was able to drive to Francistown –dodging the potholes and the donkeys – and visited Galane Gold. I have been aware of Galane Gold for some time now, and am friendly with the geologist who originally found the disseminated gold deposits in the Tati Greenstone Belt. 

Lessons from the Iron Lady

Margaret Thatcher has died. I am old enough to remember the sometimes-fraught period in Britain when Margaret Thatcher was its prime minister. The Unions were realising the extent of the influence that they could wield, and were using this power, some say, to the detriment of the nation.

Gold in them hills

This has been an interesting issue to write and assemble. For one of the articles in this edition, my colleague Lionel Williams spoke to De Beers’ chief executive officer Phillip Barton about the company’s plans to take Venetia underground. This is effectively going to be a new mine and is why the project is going to consume a record amount of capital. 

Fair dealing not rocket science

Cape Town once again hosted a busy Mining Indaba. This year’s Indaba was the largest held to date and reflects the level of interest in Africa’s mineral resources. 

Saved by the Bell

A hobby of mine is old cars, one of them being a 1966 MGB. Last week, a failed clutch saw me stuck in Pretoria. I was standing looking at the car with its bonnet up, when I became aware that a large bakkie with ‘Bell’ emblazoned on its side had pulled up behind my stranded vehicle. 

Record year

At the time of writing, it is the end of another exciting and highly successful year for Mining Review Africa in spite of the labour issues that had such an effect on the mining industry.

The hidden costs of mine strikes and violence

In an interview about two months ago, Impala Platinum CEO Terence Goodlace had this to say to me: “The situation relating to the South African mining industry has deteriorated to the stage where deeply concerned international investors could cost the country a great deal more than the billions of dollars already lost in the wave of illegal strikes and violence in which close to 50 lives have been lost.”  

‘Displacing ourselves from the market’

This rather strange title – which comes to us courtesy of Merafe Resources CEO Zanele Matlala – refers to South Africa and the global ferrochrome market …… and although you may be puzzled at first, it does make sense in the end. 

Coal is here to stay

Paging through this issue of Mining Review Africa, one cannot help but note the number of coal companies coming to the market in Southern Africa, as well as existing companies planning expansion in the region.

Has platinum lost its shine?

If there’s one compensation to be drawn from the current downturn in the platinum sector, it’s that the top men of the four top companies in the global industry – all in South Africa, of course – are positive about the medium to long-term future.

Positive Signs

Susan Shabangu’s recent statement that South Africa needs a tax dispensation that will keep it competitive in the world stage needs to be welcomed. She was quoted as saying that the proposed resource rent should not become a tax burden on the mining industry. 

Ants and co-operation

As a child, I used to watch ants and other insects at work. What always fascinated me was the co-operation that ants and termites had going for them. Not being an entomologist, I will refrain from commenting on the intelligence of ants, but one thing was for sure – you couldn’t beat them for single-minded purpose.

Farmer’s footsteps

Being in my mid 60s, I am old enough to remember the days of magazines before computers, e-mail and the Internet. How we managed I do not know. I recall sending my typewritten pages off to a company who specialized in setting type. A couple of days later, you would get ‘galleys’ back from the typesetter.

Great Indaba

I normally don’t get too enthusiastic about trade shows, as I have had to traipse around more than a few on sore feet. However, this year’s Mining Indaba in Cape Town was exceptional. True, we had to wait a bit for our admission documentation, but once the Mining Review Africa team were inside, it was ‘go’ from start to finish.  

Handle with care

While countries such as China and India come seeking after Africa’s minerals, there has also been a shift in the attitude of many African governments to the mining industries of their countries.  

Refreshing Mining Review Africa

Mining Review Africa has evolved and changed over the years just as the industry it serves evolves and changes. Notably it made the successful transition from being an alternate monthly to a monthly publication during a global economic crisis. Mining Review Africa also saw the overarching management structure and ownership of the organisation to which it belongs change dramatically; from being part of a medium size enterprise it became a cog in a large billion dollar multinational group.  

A look back at 2011

The year was one of steady recovery for the global mining sector and one of uncertainty, in that the financial crisis which hit commodities markets in 2008 was never going to be resolved easily, and in fact has not been resolved. However, large scale global industrialisation underpins most commodity markets and more projects are moving from studies into implementation.  

West Africa remains choice of the day

By Lionel Williams, Deputy Editor, Mining Review Africa

Africa is a continent of everyday and often dramatic transition that has led more than one foreign visitor to observe that the only constant is the relentless change that seems to enforce itself repeatedly from Cape to Cairo and back again. 

The Zambian expansion explosion

By Lionel Williams, Deputy Editor, Mining Review Africa

All sorts of opinions are being bandied about these days as to how quickly and by how much the Zambian mining industry is likely to expand in the short- to medium-term – most of them more positive than not.

Beneficiation is a must – But we do

In South Africa I believe the policy is to encourage beneficiation, to put measures in place that enables this. It is correct that it should be so since, to put it crudely, if one does not beneficiate minerals one is largely exporting expensive dirt, which other people then take much further down the value chain.

Mining sector recovery complete

If you look at what the mining sector achieved last year going into this year, its recovery from the economic slowdown is complete. The massive collapse of 2008 is now only a blip on upwardly trending charts, at least from the perspective of the minerals commodity business and associated industries.

Moma expansion well justified

By Lionel Williams, Deputy Editor, Mining Review Africa

You might find it strange to read in this issue that London and Irish stock exchange-listed Kenmare Resources plc is planning another major expansion programme at its Moma titanium minerals mine in Mozambique, while still 18 months away from the scheduled completion of its current growth initiative.

Eritrea – newcomer to global mining

By Lionel Williams, Deputy Editor, Mining Review Africa

The emergence in the first quarter of this year of the first modern-day mine in Eritrea, Canadian-based Nevsun Resources Limited’s low cost, high grade Bisha goldcopper operation, marks an historic milestone in the development of the country that straddles the horn of Africa as a low-key but growing new entrant on the mining map of the world. 

Uranium’s future looks bright

As I write this comment today, a month has passed since the Fukushima nuclear plant crisis in the wake of the devastating earthquake and tsunami that struck Japan – and the after-effects of the triple disaster remain with us as strongly as ever. While two major after-shocks have not damaged the stricken nuclear station any further, owner Tokyo Electric Power Company is still battling radiation leaks from the station. 

Zimbabwe – confidence and confusion

As always these days in Zimbabwe, and in many other mining destinations as well, the mood of uncertainty continues over the confusing succession of developments relating to the future of mining, all other industries, and of the country itself. 

The good and bad of mining skills development

Not a week passes without coming across some dramatic reference to the shortage of skills in South Africa. The latest I have just read is a prediction that South Africa will go through the same social upheaval taking place in some of Africa’s Mediterranean rim countries. This is predicted, in part, because of an exodus from the country of professionally skilled individuals of all ethnicities.

Zambia’s mining sector looking good

All jurisdictions have their issues and difficulties that mining companies need to take into account when making their investments. In general, it has become a bit harder to do business as a mining company in many parts of the world. That means those jurisdictions which do provide a reasonably friendly mining policy and regulatory environment give themselves a great advantage over other places where narrower interests hold sway.

What was and what will be

For the mining sector, 2010 was a year of consolidation, after the stress tests of the past few years. In the first part of 2008 the intense demand for equipment, resources such as electricity in South Africa, and skills, exceeded the capacity for their delivery. By early 2009 the opposite had occurred.

Consolidation among mining suppliers

Mining is a global business and the evolution of the South African sector that services this industry has continued apace. It is reflected in the recent acquisition of Linatex by Weir Minerals, as the latter continues to diversify its offering from a traditional base of slurry pumps.

Africa’s potential

The mood in South Africa has improved over the past few months due to a degree of pullback on the sabotage of the country’s mining sector through maladministration and corruption. A set of scenario studies envisaged the high road future for South Africa as one relying on civil society, not to mention a degree of international pressure, to keep obnoxious politicians in line, and this may have been a demonstration of that.

West Africa still tops the gold parade

By Lionel Williams, Deputy Editor, Mining Review Africa

A little over a year ago I wrote about how my discussions with senior executives of major, mid-tier and junior gold producers in the United States, Canada, England, Australia and South Africa had left me with the distinct impression that West Africa was the emerging star on the international gold scene.

Mining Review Africa’s Digital Strategy

When we started Mining Review Africa in 2003 we asked ourselves, what can we do to ensure we are the best at what we do? That is in addition to making sure we get all the small and big things right that one has to, to make Mining Review Africa (or for that matter any publication) successful. 

Little room for complacency

South Africa has just hosted the Fifa world cup, and if nothing else it reminded of how things have changed for a once isolated country. And seeing the country’s president Jacob Zuma sitting next to Fifa president Sepp Blatter attending soccer matches reminded me of another time some years ago.

Internationalisation

The mining industry is global in nature and we are seeing the completion of that process related to South Africa’s mining sector. I have been following the industry since the early 1990s and recall the excitement as the large mining groups were able to emerge from the cocoon of isolation and start spreading their wings, first tentatively and then with verve.

Mining and Taxes

A Citibank mining survey put South Africa as the world’s richest mining country in terms of its reserves, which according to it are worth US$2.5 trillion. Surveys of this nature can be somewhat arbitrary, since they depend on existing commodity prices for one thing. And while South Africa underperforms relative to its reserves, mostly accounted for by platinum group metals in this survey, such claims of wealth are probably unwelcome in any case.

Iron Ore

Iron ore is arguably the commodity of the moment. Case in point is multi-commodity group Exxaro, which sees itself as not only a coal dominated business. While Exxaro is exiting the zinc sector and monitoring the titanium sands industry with less enthusiasm than it once did, it is looking at iron ore projects as a route for diversification.

Zimbabwe poised between hope and despair

Simply because of its proximity, Zimbabwe has always been important to South African mining companies and the support industries that have grown around mining in this region. The news out of Zimbabwe continues to be mixed. Gold production, which came to a halt in Zimbabwe about a year and a half ago has recommenced at a myriad of small producers, which are now able to repatriate their earnings and obtain payment in US dollars for their output.

SA and Nationalisation

This year’s annual mining Indaba in Cape Town had more of a buzz to it, in comparison with 2009. Zimbabwe’s potential gained a particularly high profile; many see opportunities in this geologically rich terrain that has experienced little modern exploration. As more than one project developer notes, first one looks at the geological potential and only then does one assess the country political and other risks.

What has come about

As we enter the second decade of the millennium, or approach it (for the purists who remind that the decade actually technically starts with 2011) it is worth briefly considering what has happened in the continent’s mining sector over the past 10 years.

A few trends near the end of the decade

Taking into account the experiences of a variety of groups, ranging from banks to engineering companies, a few clear trends have emerged in Africa’s mining sector.

A rough year

I think few would disagree that 2009 has been a rough year in Africa’s mining sector, but strangely, in the 15 or so years I have been following the industry, it does not seem like the worst.

Mining industry on the way up

I read with great interest this week that global mining mergers and acquisitions – which are down more than 50% this year – are set to recover in the first quarter of 2010 as metal prices surge on signs that the worst recession since World War II is easing.

Gold community clamouring for West Africa

Having spent a good part of the past month in conversation with a variety of senior executives of both major and junior gold producers in the United States, Canada, England, Australia and South Africa, it has become quite clear to me that the majority of them not only believe a new star has emerged on the international gold scene – they are putting their money where their mouths are.

We wait …

The big exception to the commodities downturn we have seen over the past year is gold, which always has been somewhat a counter cyclical commodity. It did not thrive as much as hoped for during the run up to the last commodities peak, but overall over the past couple of years gold miners have been in a good space, in terms of price and demand economics.

When gold should be king – tragedy instead

The big exception to the commodities downturn we have seen over the past year is gold, which always has been somewhat a counter cyclical commodity. It did not thrive as much as hoped for during the run up to the last commodities peak, but overall over the past couple of years gold miners have been in a good space, in terms of price and demand economics.

Revival in Zimbabwe

Commodity prices are down, demand for commodities is for the most part down, and finance is that much harder to obtain than a year ago. In these times the mining industry is understandably subdued.

Mining in Context of the Slowdown

Mining is one of the few sectors where the continent of Africa holds its own globally in economic terms. Some 13% of the global mining sector’s economic activity takes place in Africa, comparable to the continent’s percentage of the global population.

The policy cracks in Africa’s mining sector

Africa’s broad transition from a collection of states undertaking largely disastrous socialist experiments to a more stable democratic continent is no more than two decades old. Many of its countries have adopted investor friendly mining codes. Mining and exploration projects are underway in the majority of countries across the continent.

After the Massacre

The attrition in mining projects over the past few months has been notable, though perhaps not unprecedented. Particularly hard hit has been the base metals sector, with high profile copper and cobalt projects being suspended in central Africa.

Juniors Prepare their Survival Plans

Spending some days in Toronto in late October, during what was hopefully the height of the global financial meltdown though many financial analysts suggest we may not be so fortunate, was an interesting time to be speaking to junior exploration and development companies.

After the burn

With the ongoing fallout of the sub prime crisis in the US, the impacts of high commodity prices themselves, oil in particular, on economic growth, and the recent strengthening of the dollar, commodities have lost some of their steam over the past few months.