Precious metals major Sibanye-Stillwater has announced a MoU to establish a South African-first agri-processing joint venture initiative.
This demonstrates that the company’s commitment to long-term economic sustainability is far greater than just a compliancy, box-ticking exercise.
It is difficult not to be impressed by Sibanye-Stillwater when taking the time to delve into its five-year history.
An immediate turnaround strategy has seen Sibanye-Stillwater revive some of the country’s oldest gold mines and deliver a profitable gold business.
It has further committed heavily into the fields of digitisation through the Digimine programme at the University of Witwatersrand and despite some unfortunate safety incidents is helping drive the industry towards achieving zero-harm.
This article first appeared in Mining Review Africa Issue 10 2018
And after successfully acquiring the US-based Stillwater operation and local Anglo Platinum assets, it now works to conclude the acquisition of Lonmin and deliver a consolidated PGM industry which is desperate for the guidance of a leader which can ensure job and production stability.
This volume of activity in such a short timeframe is enough to keep any CEO busy, but because Neal Froneman has surrounded himself with an incredible executive team, his company is able to focus on other equally important areas within the business.
In the fields of sustainability, Dawie Mostert, executive vice president: organisational effectiveness and Thabisile Phumo, senior vice president and head of stakeholder relations are delivering on this front in true Sibanye-Stillwater style – going above and beyond what is expected at a government and community level.
The driving force behind building a truly sustainable business
With more than 20 years’ experience in the mining industry, Mostert was appointed on 1 January 2013 into his position to focus on introducing new operating and business models in support of directing a turnaround at Sibanye-Stillwater.
To reach the position the company is in today, Mostert took on the job of reviewing the existing operating models in the different areas of the business post the unbundling to determine as a starting point what was and was not working.
“The existing social and labour plan (SLP) projects had clearly been established as nothing more than a requirement to appease the necessary powers. But even so, the projects in existence did not deliver and were not meeting any objectives. In many cases we chose to discontinue them,” Mostert points out, adding that:
- There was no operational capital for post mining investment – to set up and grow the businesses;
- The knowledge base was very low to build and maintain the businesses; and
- Those projects that existed did not comprise a model conducive to scale and sustainability and the business to make them sustainable.
Starting from scratch in essence, the Sibanye-Stillwater dream was and still is to create in excess of 5 000 jobs through sustainability initiatives.
“This has required connecting with the right people and spending the time to set up the correct foundations and building blocks to ensure success,” Mostert highlights.
And so, through the establishment of a Social License to Operate Committee who is connecting with the right institutions who also believe in and will drive and invest in the right sustainability projects, Sibanye-Stillwater has initiated a world-class, South African project which should be seen as an example for other mining companies to follow.
A world-class, South African project
Together with the West Rand Development Agency, the Gauteng Infrastructure Financing Agency and the Far West Rand Dolomitic Water Association, Sibanye-Stillwater has entered into a MoU for the collective development and implementation of a pioneering agri-processing industrial cluster initiative.
This initiative is further supported by Public Investment Corporation and the South African Department of Planning, Monitoring and Evaluation, whose active participation will assist in the effective implementation of the programme.
Named Bokamoso Barona, it is a unique, co-operative, multi-stakeholder approach to promoting sustainable economic activity through the development of a large-scale agriculture and bio-energy hub in areas of the greater West Rand district amongst local economies currently predominantly dependent on mining.
The initiative has seen Sibanye and the Far West Rand Dolomitic Water Association make available approximately 30 000 ha of land in the Merafong City Local Municipality and Rand West Local Municipality to facilitate the development of this prototype agri-industrial hub in the Gauteng Province.
The Bokamoso Barona initiative aims to:
- facilitate the creation of a sustainable post-mining economy in the programme area;
- create employment in the programme area through a particular focus on agriculture, the development and transfer of skills and an emphasis on the creation of labour-intensive opportunities;
- accelerate transformation by creating opportunities and provide on-going development and training for the surrounding local communities, and
- facilitate comprehensive and sustainable local socio-economic development.
It is expected to be implemented on the basis that it will:
- be responsive to the needs of the local communities that will secure socio-economic benefits;
- promote the establishment of black entrepreneurs and industrialists supporting the transformation of the local economy;
- attract substantial investment from a broad range of commercial and development financing institutions;
- optimise the value derived through critical resources, most notably land and water; and
- provide for the active participation of all stakeholders that have a legitimate interest in the establishment and operation of the envisaged agri-processing industrial cluster.
“More than four years ago, we had a vision as a company to fully immerse ourselves in the broader regional economic integration of our local economies and communities and to reaffirm our deep commitment to South Africa,” says Froneman.
“There is still some way to go before implementation of the initiative and, due to the complexity and scope of this ground-breaking initiative, there will no doubt be significant challenges that will need to be dealt with.
‘Nonetheless, it is heartening to note the level of co-operation and alignment between the partners, which represent serious commitment from business, local government, national government and the investment community,” continues Froneman.
Seeing the vision materialise
From an agricultural context – the establishment of various farming activities will be the focus, but in in addition to food supply will also be used to generate energy Mostert reveals.
Export opportunities will also be evaluated – entrepreneurs from the Netherlands have for example shown interest in participating in the project through nut farming for export.
“The regional conditions are right for this so we know a project of this nature will deliver good returns.”
As founders, Sibanye will remain an active participant in the project until the correct procedures have been implemented to see success.
“We will stay involved for at least the next five years to ensure the projects are properly established.”
With a senior, qualified programme manager to run the ship, develop business models and connect with tertiary institutional academics to transfer knowledge, projects will be evaluated on a case-by-case basis and determined with an established business model.
Sibanye’s involvement is clearly about more than just implementing initiatives but remaining involved to ensure their success.
Bringing home world-class standards
The acquisition of Stillwater did not only deliver Sibanye with the world’s largest primary palladium producer but also a world-class environment-friendly and sustainable operation. It has for example the lowest furnace emissions in the world.
In excess of 50% of the mined tailings typically are returned to the mines after processing and are used as underground fill. The remaining tailings are placed in lined tailings ponds where the constructed embankments are contemporaneously re-vegetated and contoured to match the surrounding topography.
Mine effluent water generally meets drinking water standards aside from elevated concentrations of nitrates from the explosives used underground. These nitrates are treated and removed biologically before any water is discharged.
Tailings water is recycled through lined facilities back to the concentrators and not discharged to the environment. Regular bioassays of tailings water consistently show 100% survival of trout fingerlings.
Biodiesel blends are used as fuel underground, both for their cleaner exhaust and to reduce carbon footprint. Likewise, in an area noted for its abundance of deer, elk and bear, the Stillwater mine also hosts a large herd of bighorn sheep that winter on the mine property.
Its Good Neighbor Agreement is equally impressive. Now in its 19th year, the agreement legally commits the company to work closely with and provide full environmental disclosure to its neighbours and certain regional environmental non-governmental organisations.
Provisions of the agreement include transporting the majority of company employees to and from work in buses so as to minimise traffic on rural roads; periodic meetings among the parties to the agreement to discuss concerns and consider environmental performance, ongoing company funding of an independent engineering firm to monitor and report on the company’s environmental outcomes and open community involvement in company dealings with regulatory agencies.
“The operation is successfully maintaining an open relationship of trust between ourselves, the community and the regulators and I believe we can achieve similar relationships and successes here at home,” Mostert points out.
“But we need to plan and put in place a system and steps with an end goal in site. We also need to be so influential that our internal culture drives our employees’ actions. This may be a long-term goal but we are confident it can be achieved in South Africa.”