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Sep 21, 2012

21/09/2012 (On-The-Air)

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Rustenburg|Sun City|Engineering News|Impala Platinum|Mining Weekly|Power|America|Australia|South Africa|Mine Health|Wonder Metal|Martin Creamer|Steve Phiri|Engineering News|Laptop Computer
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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: Platinum is a wonder metal that has a potential to be a key part of tomorrow’s world, Martin, or be driven out of business because of unreliable South African supply.

Creamer: Yes, I think South Africans will play fast and loose with this wonder metal at their peril. I think the whole of South Africa needs to know how valuable it is. We think of platinum, but there are six parts to platinum: there are six platinum-group metals and these are becoming ubiquitous in the world and very much part of the modern world.

When you think of just the platinum coils that can now go into the brain to cure aneurysms that prevents people from having surgery. The platinum that goes into the pacemaker for the heart and those same pacemakers are now being used for the brain. The platinum and iridium and ruthenium and all the other products that go into hard drives in computers create that storage.

I mean, ruthenium, which is one of the platinum-group metals, and I’m saying there are six of them, we mustn’t forget that, that has increased the storage of your laptop computer a hundred fold. You’ve gone from megabyte to terabyte because of ruthenium and where does the ruthenium come from? South Africa.

South Africa is in the middle of tomorrow’s world with platinum and here we are, playing fast and loose with it. If you play fast and loose, the price could spike. The moment the price spikes because of delivery uncertainties or unreliable supply, scientists look for other things. I mean, the world is competitive and although we say this is not substitutable, I bet my bottom dollar that scientists, if they have to, because of price, they will find something else.

So we should really be concerned about making sure that platinum business is reliable, competitive and perhaps we have been price takers for too long, maybe there should be some price-making element to try and create some stability because if we’re going to have to pay more to workers, we’re going to have to also consider mechanisation – that very big thing that’s on the cards.

Everybody is considering that now because they compare us to what is paid in Australia and America, but that’s a different ball game with the mechanisation, the level of mechanisation here. Perhaps we need to adopt that as well. But one thing is for sure: we’ve got to make sure that we protect this treasure trove that we have; that we’re blessed with in the Bushveld - of the platinum-group metals and also the chrome that goes with it.

We can see that chrome is also under threat. So it’s a twin whammy we’re having. There are a lot of changes in the world and we should actually be focusing our minds towards being a reliable supplier. Instead we are starting to destroy our industry.

Gwala: Just staying with platinum there, Martin. The head of South Africa’s only black-owned, black-managed and black-operated platinum company is pleading for a collaborative rebuilding of the stricken platinum business.

Creamer: You know, they were quite emotional this week, the Bafokeng, because they are really deeply within the platinum belt and they know how valuable this is.

They know the battle that they’ve had to actually get a share of this and Steve Phiri, who is becoming a leading figure now, he said that South Africa needs to wake up and behold! They must stop killing themselves. He’s saying that the platinum industry is seriously bleeding and it could bleed to death if we don’t start working collaboratively and having an enabling, regulatory environment.

One of the big things that is holding South Africa back, and we know we have the triple evils of poverty, inequality and unemployment. People are saying this is a great evil, but why do we have that? Business people say that if we could have predictive policy that can be implemented, we can make sure that we get rid of the unemployment, get rid of the inequality, we can actually reduce the poverty substantially.

So they’re pleading with government now not to erode the competitiveness of business, to make sure there’s a good regulatory environment. And when you bring in legislation it’s got to have good intention and good implementation. And we see so much that may have good intention, but no implementation or very bad implementation; and just an example, which the industry is now raising is Section 54 of the Mine Health and Safety Act.

Now the government was correct to introduce some stringent measures to make sure that there is safety, but the implementation was so bad that it actually sabotaged our industry. It sabotaged the platinum industry. For instance, they would come in and have a look at a railway line and see a tiny little fault in the line and they would stop the whole mine.

I mean, that line could be fixed within a few minutes, but just to show their power and to show that they’re really going to do something, they stop the whole mine. That actually creates a greater environment for people to die, because when you stop and start mines it becomes very, very dangerous. So there we see a good intention with a policy and regulation, but shocking implementation that actually sabotaged our country.

Gwala: Just to go back to the Bafokeng community because the R6-billion-plus, and this is a lot of money, that the Bafokeng community has received in platinum dividends has been invested in social infrastructure in 29 villages.

Creamer: Now just look at that. The Bafokeng, they are now the biggest single shareholder of the world’s second-biggest platinum company, Impala Platinum. They also have a partnership with Anglo American in RBPlat, which is Royal Bafokeng Platinum, so they’re actually miners and operators themselves.

From the dividends, R6-billion worth of dividends, they haven’t said they are going to dish this out in cash to our people. No, they have done the job of the taxpayer. What we should be doing, they did with that money. They took that money and they ploughed it back into schools, roads, water and sanitation in 29 villages.

And they also built some super infrastructure. You’ve got the sports palace and all those other things. That is not their job to do. They could have well have taken those dividends and pocketed them and bought new cars. We’ve seen in other situations where there is a lack of structure amongst the community and things fall apart.

We saw it at Wesizwe, where people were anxious to get their hands on that cash so that they could spend it on consumer goods. You saw nothing going back into the ground, whereas the Bafokeng community have been a paragon of virtue. They’ve fought for this since 1830. Their king sent people to Kimberley and made them earn money on the Kimberley diamond mines in order to buy that property that they live in that’s so close to Sun City and all those other places.

Because the Lutheran Missionaries warned them in this world you must have ownership, you must have title to that. They didn’t realise that they were having title to the most valuable piece of real estate in the history of the world because it was underlain by this Aladdin’s cave of treasure of platinum.

But then when they got the dividends from that, they didn’t waste them. They have done the job, really, of the Rustenburg municipality by putting in all this infrastructure. They’ve even gone into joint venture, in addition to what they’ve put in in their 29 villages, with the municipality for roads and things like that.

So they have really been an example of being pro-taxpayer because they’re relieved the burden on us and the ratepayer. They’ve done what we should be doing. Now they’re saying don’t threaten the goose that has laid the golden eggs.

You are really behaving in a way that could damage this whole industry. So the call to South Africa is ‘wake up and behold!’ - this is almost biblical says Steve Phiri, lets sort this out, lets work together, lets join hands, lets act collectively and do what’s good for South Africa.

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.

Edited by: Creamer Media Reporter
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