Interview: Cobus Loots, CEO, Pan African Resources

Mid-tier miner Pan African Resources is a South African gold producer with both surface and underground operations. They have a stated commitment to reduce energy consumption and shift to renewable energy sources. CEO Cobus Loots here explains their solar plans and response to their broader ESG initiatives.

Energy and Mines: How is the focus on climate change and ESG driving energy decisions for your operations?

Cobus Loots: Our operations are all located in South Africa, which has a legacy of sourcing its energy requirements from fossil/coal generated power plants operated by state utility Eskom. The energy mix has therefore relied predominantly on these (initially cheaply available) fossil fuels. We believe that increasing use of renewable energy by major consumers will ultimately reduce demand from fossil fuel power stations and the resultant positive impact on pollution levels will have a positive effect on climate change. We intend to do our part and increase our renewable energy footprint.

Pan African Resources’ energy strategy is to diversify its energy mix over time, and progress towards decarbonisation through the increased use of renewable energy options that will benefit both the environment, through significantly reduced GHG emissions, and our long-term business sustainability through cost efficiencies. Energy consumption accounts for ~30% of our total production costs and feasibility studies have demonstrated that power generation through solar PV plants will reduce these costs significantly, while at the same time addressing production downtime as a result of power disruptions from the grid.

Renewable energy is part of the solution to provide both cost efficiencies to our business and life of mine models, while at the same time being environmentally friendly. Solar energy, even though not a total solution, will contribute to reducing Pan African’s carbon footprint and through more cost effective energy storage solutions technology being developed, will potentially provide full solutions in the near future.

Pan African’s first 10 MW solar plant at our Evander operations, to be commissioned in early 2022, is a start towards the transition to the Company’s low carbon footprint, with plans to scale the facility to 26 MW imminent, following the announcement by the South African government to allow private producers to build renewable energy plants of up to 100 MW. Likewise, a feasibility study for a 10 MW solar plant at our Barberton Mine operations is also nearing completion, with possible expansion also in the pipeline. We will be investigating storage solutions and alternative energy sources, such as gas, for furthering our transition towards a low carbon economy.

E&M: What more can be expected from Pan African in terms of renewable energy going forward?

CL: The solar power generation takes care of our daytime operational energy requirements to a large extent. Energy storage solutions will be the next step towards optimising the solar energy strategy, thereafter we will look at the feasibility of alternative energy sources, including natural gas.

E&M: What type of feedback have you received from key stakeholders on your decision to move ahead with solar?

CL: Pan African is a progressive mining company committed to a “beyond compliance” approach with our ESG initiatives. Our key stakeholders expect the Company to reduce the negative impact of mining on the environment, at all levels. The solar plants are seen as a positive on our path to decarbonisation and reducing GHG emissions, with the added benefit of securing a stable power supply for our operations and cost savings in the medium to long term, which will improve shareholder returns through reduced production costs. Additionally, companies with higher ESG ratings could be expected to have improved shareholder returns over time.

Cobus Loots will be joining Shanta Gold CEO, Eric Zurrin, Centamin CEO, Martin Horgan, and Anglo American Group Head of Carbon Neutrality, Pierre Herben for the opening keynote panel session of the Energy and Mines Africa Virtual Summit, Feb 22, 9.40 AM SAST.