Iron-ore miner Kumba Iron Ore's Sishen Iron Ore Company (SIOC) has entered into an energy offtake agreement with Envusa Energy – a joint venture between Kumba's parent company Anglo American and EDF power solutions – for the embedded on-site supply of electricity to the Sishen mine, in the Northern Cape, from the Sishen solar PV plant.

The project entails the development of a solar PV facility located atop the already built G80 waste rock dump within the Sishen mine boundary. The first electrons from the project are expected to flow in the fourth quarter of 2027.

The solar PV facility has been sized to deliver the highest cost savings and is designed with an installed capacity of 72.5 MW direct current, supplying 63 MW alternating current. This will increase Kumba’s total renewable-energy penetration to about 45%, including the 11 MW of wheeled renewable energy supplied to the Kolomela mine through Envusa’s Koruson 2 cluster.

Kumba states that the solar project is the first embedded renewable-energy project to reach this stage under the Envusa Energy programme. This milestone follows the successful delivery of Envusa’s Koruson 2 cluster, spanning the Eastern and Northern Cape provinces, which comprises three utility‑scale projects – the 240 MW MooiPlaats solar PV, the 140 MW Umsobomvu wind and the 140 MW Hartebeesthoek wind projects.

“The Sishen solar PV project is designed to deliver reliable, cost-competitive renewable energy and, together with Kolomela, which has been receiving 11 MW in wheeled renewable energy since March 2026, strengthens the pathway to a lower-carbon future. The project advances our ambition to reduce greenhouse-gas emissions by 28% by 2030 and supports Anglo American’s 2030 climate target,” Kumba CEO Mpumi Zikalala comments.

Kumba says the solar project is the next critical component of its Healthy Environment strategic pillar to deliver the renewable energy that is needed to reach carbon neutrality and is positioned to displace about 35% of Sishen’s current Scope 2 carbon emissions at steady state. 

Envusa CEO Nicole Mason points out that the project required innovative engineering solutions to address complex geotechnical conditions, transforming the site into one that delivers economic, energy and environmental value.

She explains that a mobile adjustable substation has been incorporated into the project to effectively manage ground settlement. "This unique feature allows for greater adaptability and resilience, addressing site-specific challenges that standard PV
installations may not encounter," Envusa says.

The project also uses fixed-tilt PV structures, equipped with adjustable legs to help deal with ground settlement challenges. "This innovative design allows for precise modifications, ensuring optimal alignment and stability even as the dump settles or shifts over time,” explains Mason.

Further, the project repurposes previously disturbed mining land at the G80 waste rock dump, rehabilitating the site into productive, energy‑generating infrastructure. Envusa points out that, by developing the PV plant on top of a 100 ha, 20-storey-high waste rock dump, the project transforms underused land into a productive asset, while also ensuring the development does not compete with surrounding communities for land access or agricultural use.

“The approach enables renewable energy generation while minimising impact on undeveloped ecosystems, aligning sustainability objectives with land rehabilitation, improving energy security, and reducing the operational carbon footprint of the Sishen
mine,” says Mason.

In addition to the environmental benefits, the solar project is also designed to create meaningful local impact – prioritising employment for Kumba's host communities, building skills through accredited training and expanding access for local businesses.

"Through this approach, we are not only decarbonising our operations, but also enabling inclusive, sustainable growth," the company states.

Further, Kumba points out that the SIOC Community Development Trust will hold a 10% interest in the Sishen solar project, ensuring host communities share in dividend flows from long‑life mining and energy assets.

Mason says reaching financial close on the Sishen Solar PV project is a clear testament to the technical excellence and resilience of the project teams.

“Innovation has been a defining feature of this project, but innovation alone is never enough. Bringing a project of this scale and complexity to life has required the commitment and collaboration of Kumba, our customer as well as our lending partners, advisors and Eskom. We extend our sincere appreciation to all our partners, and in particular to Kumba, for the confidence they placed in us to deliver this pioneering renewable energy project,” says Mason.

SIX-MONTH PRODUCTION PERFORMANCE
Meanwhile, Kumba has maintained its 2026 iron-ore production guidance at between 35-million and 37-million tonnes for the financial year ending December 31, despite production for the first half of the year having decreased by 3% year-on-year to 17.7-million tonnes.

Zikalala says the lower production reflects a softer contribution from the Kolomela mine, which was partially offset by a "solid operating performance" at Sishen.

Sishen’s production for the six months ended June 30 rose by 3% year-on-year to 12.7-million tonnes. The mine is expected to produce about 22-million tonnes of iron-ore for the full-year to December 31.

Production at Kolomela for the first half of the year, however, decreased by 16% year-on-year to 4.9-million tonnes owing to the planned drawdown of high stock levels in the first quarter and plant maintenance in the second quarter, which coincided with Transnet's ten-day logistics maintenance shutdown in May. The mine is expected to produce about ten-million tonnes of iron-ore for the full-year.

“Our dollar-denominated C1 unit cost in the first half was impacted by a stronger rand and above-inflation increases in key mining input costs compared with the prior period, largely reflecting the effects of the Middle East conflict. In response, we are progressing a range of initiatives to enhance operational efficiency and optimise our operating and capital cost base.

"To better reflect prevailing market conditions, the exchange rate assumptions underpinning our C1 unit cost guidance of about $45 per wet metric tonne has been revised from R16 to R16.50 to the dollar. While the underlying rand-based unit cost guidance for Sishen (R530 to R560 per dry metric tonne) and Kolomela (R430 to R460 per dry metric tonne) remains unchanged, we expect Sishen's unit cost to move towards the upper end of its range and Kolomela towards the middle of the range. We note that the cost environment remains volatile, with heightened risk associated with ongoing developments in the Middle East," Zikalala comments.

Kumba's iron-ore sales, meanwhile, decreased by 1% year-on-year to 18.56-million tonnes for the six months to June 30.

The company notes that rail performance stabilised during the six months under review, with fewer derailments experienced.

"In addition, proactive logistics maintenance was undertaken in May as part of the Ore Corridor Restoration programme to address the maintenance backlog and performance turnaround of the Ore Export Channel. The maintenance included replacing 101 km of rail, enabling speed restrictions to be lifted on 26 km of the export corridor," Kumba reports.

It adds that, at the Port of Saldanha Bay, critical port equipment was refurbished and Tippler 3 was cold commissioned. "Throughput rates are expected to improve following finalisation of the commissioning later this year."

The iron-ore miner further notes that its iron content averaged 63.6% for the year-to-date, which, along with a lump-to-fine ratio of 66:34, remains ahead of the company's peers.

“Our high iron-ore quality products continue to support our premium pricing. We achieved an average realised price of $90 per wet metric tonne, 8% above the Fastmarkets 62% iron free-on-board equivalent price, benefitting from resilient iron-ore market prices and a recovery in lump premium from the lows seen earlier in the year," says Zikalala.

Kumba states that steel mill margin pressures continue to drive near-term demand, but that lump and high-grade quality premia were supported by lump stocks falling to a near 12-month low at Chinese ports.

"Structural decarbonisation trends are steadily reshaping demand toward higher-grade iron-ore products that play a critical role in helping steelmakers reduce their carbon footprint. It is increasingly clear that higher carbon emission steel will face growing penalties under the newly implemented Carbon Border Adjustment Mechanism framework in Europe, placing energy efficiency at the centre of long-term iron-ore industry competitiveness," the company says. 

Zikalala says Kumba is also continuing to invest in the long-term value and competitiveness of the business.

"At Sishen, the first ultrahigh dense media separation modules are in the first phase of commissioning, and pre-shutdown work is on track for the main plant tie-in starting in August. In parallel, we are strengthening our energy resilience and supporting lower energy costs and a lower-carbon steel value chain through the integration of wheeled renewable electricity into our Kolomela operations."