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Platinum strike highlighting huge potential opportunity loss for economy

HySA's Dr Olaf Conrad and Dr Sharon Blair

HySA's Dr Olaf Conrad and Dr Sharon Blair

23rd April 2014

By: Martin Creamer

Creamer Media Editor

  

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JOHANNESBURG (miningweekly.com) – The prolonged strike of the Association of Mineworkers and Construction Union in the platinum belt is highlighting the colossal potential opportunity loss to the South African economy should the country lose out on its platinum patrimony, which has an amazingly bright latent future.

Platinum has the potential to tick all the important economic boxes for a South Africa that is striving to add maximum value to its metals and minerals.

A fuel cell industry, with platinum at its heart, would support South Africa’s drive for economic growth and jobs.

Early projections point to massive future global demand for platinum, but blurring the metal’s great potential future are concerns around security of supply.

Hydrogen South Africa (HySA)/Catalysis, a project backed by the South African taxpayer and co-hosted by the University of Cape Town and the State-owned Mintek, estimates that future global demand for platinum catalysts in fuel cells – at only 0.1 g for every kilowatt of output – would absorb South Africa’s entire current platinum mining capacity.

“When the fuel cell technology industry takes off, it’s going to be a multibillion-dollar market,” says HySA/Catalysis Centre of Competence director Dr Olaf Conrad, who, with HySA/Catalysis key programme manager Dr Sharon Blair, spoke to Mining Weekly Online from Cape Town.

The centre is targeting 25% of the global fuel cell and hydrogen catalyst market by 2020, against the background of platinum-catalyst hydrogen fuel cells being recognised globally as an efficient, versatile and scaleable proven technology that ensures clean, reliable and cost-effective power.

While many countries have their eye on the fuel cell market, they do not have South Africa’s advantage of hosting 80% of the world’s platinum.

Through HySA, South Africa already has a globally competitive Pt/C catalyst fuel cell product.

“Now we need to get it into the hands of actual customers,” the centre’s top brass report in a media release.

The global market for hydrogen catalyst demand is expected to be $207-million in 2016, well up on the $77-million estimate of 2012.

The rate of growth puts this market segment at $555-million by 2020, of which South Africa aims to capture $139-million and produce catalyst at a rate of 100 production runs a year.

Besides direct catalyst supply, HySA’s objective is also to develop the supply chain to support this market.

With the global fuel cell market poised to reach $2.2-billion by 2020, there must be scope for greater participation by South African companies.

Projected production costs of the fuel cell system for the African telecommunications market alone offer a supply chain opportunity of $56-million by year ten.

HySA’s 2020 goals – at 2 t of platinum a year – represent only the tip of the iceberg of the ultimate benefit this initiative will have on the South African economy, as the largest potential market of all for fuel cells – the automotive fuel cell market – will, at that stage, still be in its infancy.

In South Africa’s Limpopo province, meanwhile, the Japanese, through Itochu and Jogmec, have bought 10% of the Ivanhoe platinum project for $300-million and are intent on using platinum metals in cars, in greater quantities than the current 0.15 oz of palladium for a petrol engine and 0.15 oz of platinum for a diesel engine.

Also in South Africa, Anglo American Platinum (Amplats) is wooing co-investors to help it treble the $100-million financial firepower that it is directing at the platinum metals market.

Amplats’ development fund – a private equity fund managed by Douglas Investments and advised by co-investor Bryanston Resources – has provided $20-million capital to promote greater platinum metals offtake, the latest going to Primus Power of the US, for a platinum-group-metal-using flow battery that offers value at many locations on electrical power grids.

Amplats is also collaborating with US company Altergy, which plans to manufacture fuel cells locally.

Amplats also has its own platinum-based, hydrogen-powered fuel cell locomotives, which reduce energy dependence and eliminate the discomfort of emissions in stuffy underground mines.

HySA, with responsibility for the portable power market segment, is targeting commercially viable portable power systems in the 50 W to 5 kW power range for off-grid telecommunications backup, remote sensing and telemetry, as well as non-motive auxiliary power units like those used in refrigerated trucks, and uninterruptible power supply.

Its approach is to work with international fuel cell partners to enable South Africa to leap-frog into the existing global state-of-the-art fuel cells, and then to follow that up by integrating South African technology into these products and then locally manufacturing these products.

It is developing electrocatalysts, membrane electrode assemblies (MEAs), fuel cell stacks, fuel processing catalysts and components, with the first sales of its industry-equivalent electrocatalysts – involving platinum supported on carbon – expected this year.

The centre’s advanced catalyst and MEA technologies are expected to help localise the production of new fuel cell elements that will replace conventional materials, such as imported carbon fibre paper.

“The partnerships we continue to develop with the local supply chain industry will ensure local manufacturability as commercialisation progresses,” the centre tells Mining Weekly Online.

As was pointed out at the United Nations climate change convention’s seventeenth Conference of the Parties in Durban, the window of opportunity is “wide open” for South Africa to create “hundreds of thousands of new jobs and simultaneously obtain a source of clean zero-emission electricity” through the development of platinum-using fuel cells.

Platinum metals have for long been used to clean the air of the world’s major cities through autocatalysis, which renders the internal combustion engine efficient by producing water and carbon dioxide rather than carbon monoxide, nitrous oxides and particulates.

In that form, the emissions of cars can be absorbed by natural plants and converted into oxygen to improve the quality of the world’s air.

While wind power and solar power are promising technologies, they are dependent on the wind blowing and the sun shining and by using a fuel cell alongside them, the power that Nature provides can be used to create hydrogen and oxygen from water in high energy producing times, allowing the fuel cell to provide a steady flow of energy from the stored hydrogen.

Using a fuel cell when the sun is not shining and the wind is not blowing offers an energy efficient, environment-friendly way of matching grid supply with demand.

Off-grid, it can provide electricity to communities in far-flung areas that are currently uneconomical for Eskom to serve.

As platinum is unsubstitutable in fuel cells, the products provide a very real market for the metal well into the future.

Much more work must, however, be done to allay the heat danger that hydrogen presents when released from the cylinders used to store it.

Edited by Creamer Media Reporter

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