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: A new fluorspar start-up is the third mining company to nail its beneficiation colours firmly to its business mast. What is this Martin?
Creamer: Politicians have been pleading for long now, beneficiate, add value and often it has been falling of deaf ears. But you see a lot of these start-ups, and we have had three recently, just going for the idea of beneficiation, not just mining.
Now, South Africans don’t know much about fluorspar, but there is a lot to know about it because it really spreads into our daily lives, its in toothpastes, medicines, refrigerants and all over the place. We’ve got the biggest reserves of fluorspar in the world.
We are bigger then Mexico and China. Suddenly this start-up, SepFluor, which is part of Sephaku, which is about 40% black-shareholding, they’ve moved in strongly into this fluorspar arena and they’ve opened up right next to a Spanish owned mine. In South Africa you will find the foreigners are mining our fluorspar mines.
The Spanish have got the biggest with Vergenoeg, the English have got Buffalo and Witkop and we have even got the Kazakhstanis in here at Doornkop. South Africa is saying now let’s not only play in this mining market, which is about $2-billion a year, but let’s get in the bigger $100-billion of actually adding value to this. In other words, creating fluorochemicals.
We see SepFluor, which is going to list on the Johannesburg Stock Exchange before 28 March 2013, because they have to because of the Sephaku unbundling, they are now working on a mine in Rust de Winter, just 80 km north of Pretoria.
I went and walked on their paydirt there, the rocks that contain flourspar. Then, 50km away, they want to actually build up a fluorochemicals hub in Ekandustria, Bronkhorstspruit.
We know that the State in South Africa has actually been creating an added value for fluorspar for some time at Pelchem, the State-owned Pelchem, has been producing hydrogen fluoride, which they use also for their own medical businesses.
Now, we see that South Africans are finding the uses and derivatives of this fluorspar that we’ve got in our ground is so widespread. They’ve travelled to the chemical hubs in Germany and seen the potential. Even in antiretroviral medicines for HIV and AIDS they use fluorine.
They are quite anxious to get moving on this and they’ve gone to all the developmental institutions and are raising the R2.1-billion initial capital. When they go to the JSE they might even not capital raise because by that stage they might have set up the foundations of the business.
Gwala: An Australian company is preparing to mine phosphates off Namibia’s ocean floor.
Creamer: Mining is hard enough on land, now they want to go and mine the sea. The Namibian Marine Phosphates, the shareholders are mainly Australian mine-makers listed on the ASX in Australia and also UCL Resources, with a 15% Namibian shareholding.
They say it is much easier to do it at the sea, because you don’t have to sink any shaft and it is not like an opencast mine where you have got to remove all the overburden before you get to the orebody.
They are going to have a dredger that will trail an arm behind it, stir-up this very lose unconsolidated phosphate. We know how important phosphate is in the world at the moment.
We have got food security issues and you need that phosphate for the fertilisers. Bones develop from this, so it is an absolutely essential ingredient. They are saying that they can suck this up using the normal dredging methods and sort of semi-process it on the ship and then do further processing onshore.
They are talking about also beneficiating phosphates into phosacid and things like that. Of course, they have got to get over some of the environmental hurdles. But, we know that De Beers has been mining those seas for diamonds for sometime and these fellows say they will be less harsh on the environment, because they won’t actually mine to bedrock.
They will leave a sediment so that the ocean life can continue in that habitat. Environmentalist are pressurising them at the moment particularly the lobby group Swakopmunt Matters, they are making sure that they are getting all the answers.
They have got to go through the environmental hurdles. In the meantime they are looking at an initial investment of US$326-million at a time where the phosphate price is around $145 to $200 per ton depending on the quality.
So, quite a strong price for phosphates, because the world knows this is linked to directly to food and food is a security issue and the Australians moving in ahead of the South Africans.
But, behind it all, and you normally find that with these Australian companies, will be a South African and the head of Bonaparte, the original company that started to look at phosphate mining in Namibia on the ocean floor is Mike Woodbourne, of course, a South African.
Gwala: Somebody once said that if you go to some of these companies board meetings, you find people speaking in Afrikaans in Australia.
US legislators have visited Sasol’s mines in South Africa to view new life-saving technology for dangerous underground mines.
Creamer: It is interesting, we have so many deaths and injuries in our mines that it is good that some solid work is being done on life-saving technology.
Sasol Mining actually realised that they have so many people knocked-over by shuttle cars in underground mines that they put out a specification on how they can make it more safe. Now they have got this new people-to-vehicle proximity detection technology. It actually stops the shuttle cars in their tracks if they are moving too close to personnel.
This has already had a major impact to such an extent that US legislators have come out to Sasol Mining operations to have a look at this. They are intent on enforcing this by law in mines in the United States. In fact, our own Department of Mineral Resources are looking at possibly enforcing this by law.
We didn’t have anyone in South Africa who could actually do the technology exercise, so Sasol Mining put out the spec and a small US company did the initial work to make sure if these shuttle cars are moving and they are going to hit someone over, they actually automatically stop because of an electromagnetic field that they put out and its linked to miners’ caplamps and then it just stops the vehicle in its tracks.
This small company, has actually sold to a bigger company Strata and again I say there is always a South African behind things, because behind this Strata company is a South African who has been living in America for 20-years and now he is lobbying for US legislators to legislate this in the United States, which will have a big impact on the market, because there will be such a huge demand.
If it happens here as well it will also be quite big business for this company. I see one of the gold companies, AngloGold Ashanti, is already rolling out 600 of these units that stop these moving vehicles from hitting anyone over underground.
Sasol Mining itself is spending R14-million at the moment not on growth in the Secunda area, because it won’t grow its mining in Secunda, but to replace mines.
You can see big replacement coming through and Susan Shabangu, the Minister of Mineral Resources, was out there opening a new R3.5-billion replacement shaft and there are going to be two more coming up in Sasol.
But the growth for Sasol in the future will be in the Waterberg where they have applied for a mining licence. Hopefully they will go ahead with more fuel from coal operations, because it saves us a lot in foreign exchange, we don’t have to import that crude oil of what they supply here.
But they are saying that are marking time still until the government comes through with a regulatory framework around carbon capture and storage and also carbon tax, which is holding things up at the moment.
Gwala: The Waterberg region is also the region where government has announced quite a lot of investment in infrastructure.
Creamer: And they are waiting for water and transport infrastructure as well.
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.