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Aug 03, 2012

03/08/2012 (On-The-Air)

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It’s that time again on a Friday when AMLive's Xolani Gwala presents another Update From The Coal-Face with Martin Creamer, publishing editor of Engineering News and Mining Weekly.

Gwala: So an attempt is to be made to set a new land speed record in South Africa’s dry Northern Cape province?

South Africa has been chosen for this land speed record, of course, if we go back in history, we know that Malcolm Campbell failed here in 1929, with his Bluebird. The existing record is 1 227 km/hr in the Thrust supersonic car, that was set in Nevada. The people don't want to go back to the US, they don't want to go back to Nevada, and it is the firm and very long-stretching Hakskeen Pan in Northern Cape, that has been chosen to host the land-speed attempt and 300 people have been in there clearing all the rocks and the stones because this time next year, they were supposed to do it now, they planning to go ahead with that again, there have been a few hitches, of course, it would have clashed with the Olympics, anyway. They’re talking now about this Bloodhound supersonic car, it will be driven by Andy Green, who broke the record, he holds the record and he’s the Royal Air Force wing commander, he’s going to do it again, this time in South Africa in 2013, at Hakskeen Pan. It will be in the third quarter of 2013 and the power here is the equivalent horsepower of 180 Formula 1 cars. It’s boosted by a rocket, a jet engine and a Formula 1 engine. It will burst out of there at a speed faster than a bullet comes out of a Magnum gun, and its got to go in two directions, to get the world record, opposite directions, that is the plan. They were ambitious, they were going to try for a record of 1 600 km/hr but they’ve moderated it down to 1 300 km/hr, that will be the target next year and then the following year they will attempt the 1 600 km/hr.

Gwala: Mining is stimulating visible economic and social development in neighbouring Mozambique?

Take an example, on Saturday, July 21, Mozambique got its first pharmaceutical plant, this is not something you associate with Mozambique and what is the background to that? The mining, the Brazilians came in there, Vale came in early. The South Africans were a little bit fast asleep. They saw the potential in the Tete province, now they are backing spinoffs for the country. The first of these is the first pharmaceutical plant, opened by the Vice President of Brazil. The Portuguese language is a good connection there and the three medications that will come off there are antiretroviral drugs, obviously they’re looking at the HIV/AIDS problem in Mozambique and there a 2.7-million people there with HIV/AIDS. But the backers have all been the people involved in the mining. Now we see big Rio Tinto, what are they doing? In the same month they set up an agreement with local farmers because when more people move in there, more food is needed so they are setting up this agreement for the farmers to grow a surplus of products. They will fund it as well and they’re talking about exporting it now to the Middle East. Food from Mozambique, we don't associate Mozambique with food exports, they are doing very well in mining, particularly this coking coal, the big guns are in there and we see that even Anglo American coming in late from our South African base. They have brought up now some coking coal interests in Mozambique, but it all stems to their mining codes, which they set in 2002, they now tweaking that slightly, but it was attractive for investors, the investors themselves, Vale of Brazil, the first mover, you know has already put in rail and ports and we can see the other spin-offs coming through, that country, they are confident that it will achieve a growth rate of 7.5% this year and they looking at 7.9% next year. As we’ve said before, with that coking coal could be what the Bowen Basin is to Australia, I mean you know how well that has done for Australia’s Queensland province, it could be for Mozambique, sitting right on our doorstep. Very little South African involvement there unfortunately and we see others now showing that, from mining, we can get a lot of social spin-offs.

Gwala: Projections to 2025 point to cities around the world constructing the equivalent of the entire land area of Austria at a cost of a staggering $80-trillion?

We see that movement to cities is a trend in the world, urbanisation. We saw it from the year 2000 to 2010, 200-million Chinese people swapped the village for the city, we saw the impact that had on the world economy and now they talking about another 250-million Chinese moving from the village to the city in the next 15 years. Hopefully that happens. We know that people are looking at the Chinese economy and saying “hey, it’s in recession” In recession? It’s growing above 7%, you know if we could grow above 7%, we would be very happy, we’d take that any day, so you see what that sort of urbanization has for a commodities country like South Africa. This sort of prognostication that there’s going to be urbanisation, it’s music to the ears of the commodities’ suppliers, those people have now moved into the cities, become consumers, they now buy in a different pattern, which also helps us as a commodities country because they go for precious metals and minerals. You see them now buying jewellery and diamond jewellery, platinum jewellery and gold jewellery. So we are a commodities’ country that can really benefit from these trends in the world. The modern world is mining’s oyster, and so even on the car fleet side, they talking about the global car fleet doubling between now and 2030, that is 1.7-billion additional vehicles globally, I mean if you look at the distance between the Moon and the Earth, that would cover that distance if you put them end-to-end ten times over, you know, so the potential is there. Although we’ve got short-term hiccups in the local economy, the world trends point to massive growth. Globally they’re looking at the equivalent to residential and commercial buildings of the whole land mass of Austria. Now that is good potential for us in South Africa because of the commodities, first the hard commodities that go into urban construction and then the soft commodities that go into precious consumer products. That's not the whole story because on the supply side, it is so difficult to get a new mine going. Environmentalists, near-mine communities, they all hold up the progress. The last mining boom was predicated solely on supply. So, we’ve still got these supply constraints, demand building up, and that mix in the long-term picture must favour us as a commodities country in South Africa.


Martin Creamer is publishing editor of Engineering News and Mining Weekly. He’ll be back At The Coal-Face at the same time next Friday.
 

Edited by: Creamer Media Reporter
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