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On-The-Air (13/02/2015)

safm13feb2015

13th February 2015

By: Martin Creamer

Creamer Media Editor

  

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Every Friday morning, SAfm’s AMLive’s radio anchor Sakina Kamwendo speaks to Martin Creamer, publishing editor of Engineering News and Mining Weekly.  Reported here is this Friday’s At the Coalface transcript:

Kamwendo: Economic growth and the electricity crisis received a high profile in the disrupted 2015 State and the Nation address.

Creamer: It is an ill-wind that blows nobody any good and it certainly put the economics on the centre stage after the disruptions have taken place. I think we got more airtime there then we have had for a long time.

We saw of a nine-point plan to even go hammer and tongs into revitalising agriculture and agro processing and advancing beneficiation and encouraging more private sector enterprise. A lot of these steps on the electricity side were also fascinating. The emphasis on gas is also very important that could change the cost paradigm.

Also from diesel moving away from that which is really gobbling our finances at the moment. The move towards pushing base load coal generation from independent power producers is also an important step, but a lot lies in the implementation.

Kamwendo: A tsunami of money is coming Africa’s way, international investors predicted at this week’s packed Mining Indaba. 

Creamer: There was a promise of a tsunami of money coming Africa’s way. They are not talking about South Africa, but they were talking about Africa. We saw a lot of Africans saying it’s our time now, nobody talks Brics anymore, people talk Africa. They are even more keen to invest in a place like Rwanda then they are in Italy. All sorts of comments like the race for Africa is now like the Californian gold rush of 1848 where everybody is coming in to get a slice of the action.

A lot of the bankers said nowhere else in the world can investors chase yields in the high 20%. So the vibes were very good and they say a lot of Africans that had left the continent are now coming backing, opening businesses. Everybody they say in Africa now wants to be an entrepreneur. We also had the former Prime Minister of Britain Tony Blair saying he is an African optimist. He was saying how absolutely vital for Africa’s economic future the mining industry is.

He also cautioned out how difficult it is to get the things done and how he proposed a much bigger private public partnership in Africa and particularly in the areas of energy. A lot of people there are seeing the electricity side as an opportunity besides a big obstacle along with water. So, mines and all the oil and gas people wanting to come in there and actually assist with the infrastructure at the same time. It is becoming, and I am talking about Africa, the ‘go to’ place for oil and gas now, because you can go to three places in the world at the moment.

You can go to Russia that is a no-go area, you can go to the Middle East, which is a complex area, and people say they are going to swing into Africa now and that the oil and gas companies will be coming here and that was predicted by investment bankers, including Rothschild.

Kamwendo: Platinum use is poised to soar as millions of Japanese homes get fuel cells and car companies launch fuel cell cars.

Creamer: Can you believe that the Japanese are getting way ahead of us on the platinum that we are the custodians of. They are going to put 5.3-billion houses on fuel cell electricity and heat. That is coming through and it was revealed by Ivanhoe, Robert Friedland that said car companies now are queuing up to get into the fuel cell business.

He particularly mentioned two big Japanese car companies, also Korean car companies and even German car companies coming in 2017 with fuel cells, which mean that it will pull platinum, because it is only platinum that actually can serve as the catalysts in those fuel cells both in the automotive side and the electricity generating side. Potential to generate electricity there we also saw emphasise by SFA Oxford when they presented saying that the fuel cell era is upon us.

Also mentioning all these activities by the car companies. It is an important ingredient as well in the actual cleaning of fuel, the catalyst used by the refineries is platinum. That is where they see new pushes coming through, demand for platinum. It is interesting that the custodians of the market seem to be international. We don’t care enough about marketing of platinum in South Africa itself.

Kamwendo: A Free State gold mine is turning deadly methane gas into low-cost electricity.

Creamer: Methane gas that killed 40 people is the gas that is now changing from being a curse to being a blessing and providing electricity in small quantities at this point. It is at the Beatrix mine, 40km south of Welkom. They decided to turn the curse into a blessing starting with 2MW which is very moderate, but converting that methane gas which used to kill people in the Beatrix mine, into electricity at rates far cheaper then the Eskom tariff. The numbers that I heard were 37 cents per kilowatt-hour versus Eskom’s 57 cents per kilowatt-hour. So it shows that self generation is becoming a business case.

Kamwendo: 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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