Nov 16, 2007
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Maggs: This one is very topical and very necessary, I'd suggest, the country building two more multi-billion rand pumped-storage power stations to boost power supply during periods of peak demand.
Creamer: The first of these is the Ingula which will be in the Drakensberg and the beauty of pumped storage is when we are sleeping and not using electricity they can use it to pump water to a dam high up in an escarpment and then when everybody is turning on their kettles and their TVs and doing things with electricity at the same time, they can then allow that water to be released and, through hydroelectric generation, they can boost the input into the grid so that we don't run out of electricity during those peak periods. It is important that we see the economics of this because we have these open-cycle gas-turbines being built on the coast of Atlantis and Mossel Bay and these are also very necessary during peaks, but, of course, they are far more costly, these cost the earth. So it is better to come through with these pumped-storage schemes. We have had a long standing one in the Drakensberg. The new Ingula which will be about R9-billion that will also be in the Drakensberg. The tenders are out for that and close on December 3 and it sounds like a Chinese contractor might be in the running for the civils for that and then there are also mechanical and electrical tenders coming out. The second big peaking power pumped-storage project, still under its code name, is known as Project Lima, which means that you can't get full detail on it yet, but it is on the way and that will be about 1 500 MW versus the Ingula that is far more advanced at 1 330 MW and they are about two years apart. The first is due to be commissioned fully round about 2012 and the second 2014.
Maggs: This one has been a long standing debate and now two diamond companies heeding government's call for South African diamonds to be beneficiated locally rather than abroad.
Creamer: Yes, the government has been pleading with mining companies to beneficiate, that means to add value to the metals and minerals that we produce. There is a great reluctance around the issue of economics, whether this is economic to do. Two diamond companies have now come forward and they are going to go ahead with this. The first is a Canadian junior Etruscan, which mines in Ventersdorp, who has linked up with a black-economic empowerment partner. The launch of African Romance as a brand is on the radar screen. That is being lead by Moohseen Moosa, the brother of Cabinet Minister Mohammed Valli Moosa. He is leading this charge. He was actually in Parliament at the time when they formulated the mining laws so he is putting his money where his mouth is, with great ambition, and he believes that from anything greater than a quarter carat he can be competitive. Also, we have the JSE-listed Trans Hex, the biggest producer of diamonds by value that is listed on our Johannesburg Stock Exchange. They are also now entering into the beneficiation and 15% of their diamonds will go to a previously disadvantaged cutter, who will lead an operation to add value in Johannesburg to these diamonds. Beneficiation is now in a proofing stage to see whether it is economic. A lot of optimism around it, but also a lot still to be proved.
Maggs: I suspect this next item is going to be fascinating. A national photonics strategy on how best the country should harness the speed of light it to be presented to government within the next year or so.
Creamer: They say the 20th century belonged to the electron and that the 21st century will belong to the photon and we already see the speed of light being harnessed in many areas notably with our fibre-optic cables that carry our telephone messages now and also the internet far more efficiently than the old copper cables. The government, Department of Science and Technology, has taken a decision to invest in the development of a national strategy of photonics and it has set up a banner organisation called Pisa, which is the Photonics Initiative of South Africa. Pisa must in 12 months develop a national strategy. It will have consultative workshops in the first quarter of next year, bringing in academic institutions and also science councils and South African business. These will put their heads together around formulating a good strategy to identify opportunities and areas where we would have comparative advantage and then to pursue a business agenda within those initiatives. Of course, they can't do it across the full spectrum as the photonics spectrum is very wide, so they would need to pick niches as to where we would have comparative advantage and that is what they intend doing.
Maggs: 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 at the speed of light.
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