Inside Mining Resourceful Mining May 2021

RESOURCEFUL MINING

|

VOLUME 14 NO. 02

|

M AY 2 0 2 1

NEW VOLVO TRUCKS Made for Mines Gold Fields Goes for Gold South Deep Solar Project

Demand & Supply

PGMs’ Persistent Performance

ISSN 1999-8872 • R55.00 (incl. VAT)

Wear Resistant, High Performance - Global Quality Mining Pumps.

KSB South Africa is based in Johannesburg with modern manufacturing and sales facilities. With nine additional sale branches in South Africa, four branches in Sub Saharan Africa (West, Central and East Africa).

KSB is represented throughout the whole country.

KSB South Africa, manufactures our globally recognised pump solutions locally to the most stringent international and local quality standards. Our innovative solutions provide for the most demanding and corrosive slurry applications with superior abrasion resistance.

At KSB South Africa, we manufacture and service your slurry systems. We work with you one on one to find the best solution for your slurry and process pumping applications. Let us be your partner and work with you to help you meet your production goals. One team with one goal.

KSB Pumps and Valves {Pty) Ltd www.ksb.com/ksb-za Your BBBEE Partner

1-:nYEARS

People. Passion. Performance.

Kseb�

THE RESOURCEFUL MINING ISSUE | 2021

CONTENTS FRONT MATTER Editor’s comment............................................................................................................................2 Contributors......................................................................................................................................3 Foreword.............................................................................................................................................4 COVER STORY New Volvo Trucks: Made for mines ................................................................................. 6

6

TRANSPORT, EQUIPMENT & LOGISTICS Loaded with increased productivity and efficiency..........................................................8 Lubrication systems for consistent machine operation................................................10 Serious talk about SA rail........................................................................................................ 12 Road trains lead road freight haulage innovation...................................................... 15 Advanced fire protection for mining vehicles.............................................................. 17 Unbottling minerals processing plants.............................................................................. 19

12

ALTERNATIVE ENERGY Clean energy demand for critical minerals set to soar..........................................20 Off-grid alternative energy for mines...............................................................................22 South Deep makes history.....................................................................................................23 SA’s green hydrogen potential..............................................................................................27 Integrating alternative energy into mining operations............................................30 BDO SA refines natural resources service offering.................................................34

27

CASE STUDY Off-grid mining hybrid power system..............................................................................37 PUMPS & VALVES The measure of the mine........................................................................................................39 Contactless acceptance test procedure..........................................................................40

34

Working towards a digital future for mining................................................................ 41 PGMs DEMAND & SUPPLY Platinum demand drivers.........................................................................................................42 We need more palladium.......................................................................................................45 Renewable energy driving the demand for PGMs...................................................47 PGMs performance during a global pandemic............................................................50

50 1

EDITOR’S COMMENT

When the going GETS TOUGH, it’s time to GET RESOURCEFUL It is almost a year and half since the outbreak of the global Covid-19 pandemic. Not only have many of us learnt to live with the virus in the ‘new normal’, but it has also driven us to become resourceful across all aspects of our lives.

M

ining companies have, of course, also had to become resourceful when it comes to their operations. Even prior to the outbreak of the novel coronavirus, miners have often found themselves in a position where they’ve had to make the most of the resources at their disposal.

Mining is as much about being resourceful as it is about the mineral resources. In a world where some of the resources critical to a mine’s efficient and successful operation are scarce, the mining fraternity is having to think out of the box to find ways to use their resources sparingly or find additional sources of scarce resources.

Rising above the challenges Like other industries across various sectors, the mining industry also faces numerous challenges that have a direct impact on operations. The sector has, however, demonstrated its ability to remain progressive, despite the challenges.

Looking at electricity supply, mines are exploring alternative energy as additional sources of power to curb the

2

ever-increasing costs of electricity. In South Africa’s case, mine operations have had to bear the brunt of power cuts due to electricity supply shortages. The silver lining in this situation is that the country’s power challenges have opened doors for discussions about mining companies becoming independent power producers (IPPs). As IPPs, mines will be authorised to generate their own electricity for consumption.

There are ongoing discussions about regulatory challenges and increasing the cap on the amount of electricity IPPs can produced.

Speaking at the Energy and Mines Africa Virtual Summit held in May, Roger Baxter, CEO of Minerals Council South Africa, suggested increasing the cap to 50 MW – a gesture that would ease some of the pressure experienced by power utility Eskom.

When it comes to mining equipment, common challenges are wear and tear, downtime, and safety. To address these and other challenges, equipment manufacturers are producing machines with smart safety features and are gearing them to operate for longer periods in harsh mining environments.

There are many more examples that demonstrate the resourcefulness of the mining industry. Covid-19 has inevitably created much uncertainty across industries globally, and this has clearly affected the mining industry. With no knowledge of what other challenges lie ahead for the mining industry, one thing can be said with some certainty: when the going gets tough, miners get resourceful.

Dineo

THE RESOURCEFUL MINING ISSUE | 2021

CONTRIBUTORS

EDITOR Dineo Phoshoko HEAD OF DESIGN Beren Bauermeister DESIGNER Janine Schacherl CHIEF SUB-EDITOR Tristan Snijders KEY ACCOUNTS MANAGER Amanda De Beer PRODUCTION & CLIENT LIAISON MANAGER Antois-Leigh Nepgen GROUP SALES MANAGER Chilomia Van Wijk PRODUCTION COORDINATOR Jacqueline Modise DISTRIBUTION MANAGER Nomsa Masina DISTRIBUTION COORDINATOR Asha Pursotham BOOKKEEPER Tonya Hebenton

PAGE

04

“We are seeing mining companies continue to consider how to leverage the energy resources available to them to reduce their reliance on the grid, and the associated high energy costs.”

Lethabo Manamela, CEO of the South African National Energy Development Institute

PAGE

PAGE

12

“Rail has long been the backbone of the South African logistics and transport value chain, and will become even more critical in a post-Covid-19 environment.”

30

“A mining company can choose to become an independent power producer by building a power plant off-site and feed it to the grid.”

Mesela Nhlapo, CEO of the African Rail Industry Association

Dr Theo Acheampong, African Energy Chamber thought leadership contributor

PAGE

PAGE

SUBSCRIPTIONS subs@3smedia.co.za ADVERTISING SALES Amanda De Beer Tel: +27 (0)72 600 9323 / +27 (0)87 802 5466 Email: amanda.debeer@3smedia.co.za PUBLISHER Jacques Breytenbach 3S Media 46 Milkyway Avenue, Frankenwald, 2090 PO Box 92026, Norwood 2117 Tel: +27 (0)11 233 2600 www.3smedia.co.za

PAGE

45

“The drive for carbon neutrality will continue to positively affect the demand for platinum and its substitutes.”

Novus Holdings is a Level 2 Broad-Based Black Economic Empowerment (BBBEE) Contributor, with 125% recognised procurement recognition. View our BBBEE scorecard here: https://novus.holdings/sustainability/ transformation ISSN 1999-8872 Inside Mining. © Copyright 2021. All rights reserved.

All material herein Inside Mining is copyright protected and may not be reproduced either in whole or in part without the prior written permission of the publisher. The views of the authors do not necessarily reflect those of the publisher.

The ABC logo is a valued stamp of measurement and trust, providing accurate and comparable circulation figures that protect the way advertising is traded. Inside Mining is ABC audited and certified.

Olebogeng Sentsho, CEO of Ayana Group

47

50

“Mining companies have also been pushing this agenda for the sustainability of their own industry and need to find other applications for PGMs.”

“The roll-out of effective vaccines now suggests a further upside, though how soon they bring the promise of ‘normality’ will vary by country and sector.”

Prashaen Reddy, Partner at Kearney

David Jollie, Head of Sales and Market Insights: PGMs at Anglo American

COVER SPONSOR This issue’s cover was sponsored by Volvo Trucks South Africa. Get in touch with Inside Mining’s sales team to sponsor the upcoming issue of the magazine.

Contact Chilomia Van Wijk (+27 11 233 2627/ Chilomia.VanWijk@3smedia.co.za) or Amanda De Beer (+27 11 233 2612/Amanda.DeBeer@3smedia.co.za)

3

FOREWORD

Prioritising

RESOURCEFUL MINING When considering the concept of resourceful mining, as opposed to mining our resources, the overarching idea is to look at more efficient, environmentally sustainable, and profitable mining operations that are of greater benefit to the wider community. By Lethabo Manamela*

T

he ultimate goal is to get the ‘people-planetprofit’ triad in the right ratio. Energy use has a prominent role to play here, especially considering that: a) energy in the form of electricity is an essential resource critical to a mine’s operation; b) mining is incredibly energy-intensive; and c) the industry plays a huge role in South Africa’s economy, and is a large source of employment opportunities for our people.

Unfortunately, we have experienced that consistent energy supply has long been a challenge in South Africa. Our national grid regularly struggles to keep up with demand, and this has had far-reaching impacts on the economy and many industries, including mining.

Installing backup power for mining operations is no small feat, and is very expensive. A mine’s energy requirements go far beyond the abilities of a UPS and diesel generator.

Mining operations in South Africa are unique, in that the turbulent energy landscape has driven our mining industries to be at the forefront of adopting energyefficient technologies. This has been spurred largely by the high price of electricity in South Africa, and our unstable energy supply. Added to that, the local mining market is far removed from foreign markets. This means that the cost of transporting commodities is a pain point for our mines, so they need to keep other costs as low as possible.

4

Innovative mining sector All of these challenges have led to energy innovation in the mining sector. We are seeing mining companies continue to consider how to leverage the energy resources available to them to reduce their reliance on the grid, and the associated high energy costs.

There has also been a trend of investing in energy in a manner that will benefit host communities long after the mines have closed. It sounds like the peopleplanet-profit triad is starting to gain traction.

Unfortunately, renewable energy is not a comprehensive solution. It is not feasible that solar energy alone could meet the demands of a largescale mining operation. However, there is innovation on the horizon. Renewable energy can be used to create hydrogen, and this hydrogen can then be applied as fuel cell technology at the points on the mine where it is needed most. This revolutionises the green energy value chain and presents prominent opportunities for our country, our mines and our people.

Hydrogen in the horizon Efforts are already under way in South Africa to leverage our hydrogen economy, with the Hydrogen Valley Project spearheaded by South Africa’s Department of Science and Innovation. The collaboration agreement also includes energy and

THE RESOURCEFUL MINING ISSUE | 2021

FOREWORD

Mining operations in South Africa are unique, in that the turbulent energy landscape has driven our mining industries to be at the forefront of adopting energy-efficient technologies

services company Engie, the South African National Energy Development Institute, and clean energy solutions provider Bambili Energy.

A proof of concept is under way in Limpopo, with a hydrogen fuel cell and battery-powered module, retrofitted on to a large haul truck. The initiative is also exploring stationary fuel cell applications and a warehouse forklift fleet application. Developing this hydrogen ecosystem allows for the potential transition of heavy-duty freight trucks, haulage vehicles in the mining sector, and buses used for public transport.

Hydrogen Valley will stretch approximately 835 km from Mokopane, Limpopo, along the industrial and commercial corridor to Johannesburg and to the south coast at Durban. The aim is to leverage South Africa’s resources and renewable energy potential to revitalise and decarbonise key industrial sectors.

This initiative could be hugely beneficial to the mining industry, with positive knock-on effects for people, planet and profit.

Energy innovation in the mining industry is important for the sustainability of the industry from every angle. South Africa can ill afford our erratic energy supply. Green energy initiatives stand to decrease our carbon footprint, increase the longevity of the mining industry, and benefit our wider community.

Collaboration between mining companies, the broader public sector and energy service companies, research institutes, and a mix of government departments will result in the continuation of this upward trajectory towards innovative and climate-friendly solutions in South Africa! *Lethabo Manamela is the CEO of the South African National Energy Development Institute.

Lethabo Manamela believes that energy challenges experienced in South Africa’s mining industry have paved the way for innovation

5

COVER STORY

NEW VOLVO TRUCKS: Made for Mines

Mining requires specialised transport solutions. Steep gradients, sheer drops, sharp turns, and confined spaces, with a truck loaded to the brim – it all demands maximum skill and the best equipment for the job at hand. Even when conditions are challenging, operators need to keep the production flow going.

E

arlier this year, Volvo Trucks South Africa introduced four new truck ranges to the local market, with a strong focus on driver environment, safety and productivity. The launch of these four newgeneration extra-heavy commercial trucks – the Volvo FH, FH16, FM and FMX – is the biggest in the company’s history.

“We know that a fleet’s uptime is now more critical than ever, and our new range is purpose-built for these demanding times,” says Marcus Hörberg, vice-president of Volvo Group Southern Africa.

The Volvo FMX, for example, is Volvo Trucks’ most robust truck to date, and it will make the toughest assignments easier – whether on- or off-road. It has an entirely new cab, increased payloads, and innovative safety features. With increased front axle loads of up to 20 t and a 38 t bogie, the new Volvo FMX is built for the toughest conditions and most demanding assignments like mining operations.

“In mining, you’ll need a chassis that’s built to handle a lot of action on a daily basis. You probably have a superstructure purpose-built for your operations. We tailor your truck’s chassis to support your success – using components and systems guaranteed to work reliably for many years to come,” says Eric Parry, product manager, Volvo Trucks South Africa.

The Volvo chassis offers the flexibility to build a truck for any kind of superstructure used in any kind of transport assignment.

The new Volvo FMX features the heaviest addition to Volvo’s chassis range – a 38 t bogie that allows for a gross combination weight of up to 150 t. In addition, the front air suspension option has been updated, allowing for front axle loads of up to 10 t, or 20 t for double front axles.

For trucks with a steered tag or pusher axle, the steering angles have been increased, resulting in better

6

manoeuvrability and reduced tyre wear. All these improvements add up to greater productivity and cost efficiencies for mining transportation tasks.

Whether an operator needs a truck built for tough terrain, excellent comfort or massive pulling power, the new Volvo Truck range is made to deliver time after time.

New cab, tough exterior Volvo’s new FMX is built on an entirely new cab platform, based on Volvo’s long and successful experience of delivering robust and functional mining trucks. “The new Volvo FMX is designed to give a superior combination of agility and durability,” explains Parry. “The completely new cab includes a front section with easily replaceable sturdy parts, headlamp protectors and new V-shaped LED headlamps. To make it easy for drivers to enter or exit, we’ve designed new anti-slip footsteps.”

For particularly rough applications, the Volvo FMX comes with an optional steel roof hatch with an emergency exit handle that removes the entire hatch.

Added driver focus The Volvo FMX comes with increased space in the day cab and storage of up to 800 litres. Where the FMX operates, visibility is of utmost importance.

For this reason, Volvo Trucks designed the FMX so that drivers have improved visibility thanks to a lowered door line and new rear-view mirrors. The visibility is further improved by adding a camera on the passenger side, which provides a complementary view of the side of the truck.

The interior is characterised by a new robust and dust-resistant dashboard with more storage space, new colours, and a modern cluster. It includes a dynamic,

THE RESOURCEFUL MINING ISSUE | 2021

FH16: Volvo’s FH16 truck has massive pulling power

FMX: The FMX truck is ideal for tough conditions common in mining operations

12-inch, high-resolution instrument display with a user-friendly interface, which allows the driver to immediately see relevant information and select up to four different screen views, depending on the driving situation. The instrument display comes ready for future updates and connected services.

The FMX also comes equipped with a new traction control panel that helps the driver easily and quickly handle potentially dangerous situations, both on and off the road. The driver can gain more traction by engaging the differential locks in an easy way, by turning a knob, viewing the traction status on the instrument display at the same time.

The driven front drive axle is positioned to give the truck a better approach angle. It’s designed to be strong and streamlined. The parallel rod behind the axle beam is integrated, making the sturdy axle casing the lowest point of the vehicle and significantly improving ground clearance when fully loaded.

Low-speed manoeuvring is one of the most challenging aspects of the job. Thanks to I-Shift with crawler gears, operators can drive at speeds as low as 0.5-2 km/h – ideal for work on mining sites. It also adds to the versatility of the truck, whereby the same truck can be used for a host of different driving conditions and assignments.

Safety features that help avoid accidents “Safety is in the Volvo DNA and the safety features of our new truck range reflect our commitment to increasing safety for all road users,” states Hörberg.

The new Volvo range comes with the option of Adaptive Cruise Control that now works at all speeds down to 0 km/h. Further safety-enhancing features

include Downhill Cruise Control, which sets a maximum speed to help prevent unwanted acceleration when travelling downhill.

The electronically controlled brake system, which is a prerequisite for safety features such as forward collision warning with emergency brake and electronic stability control, is now standard on the new truck. Volvo Dynamic Steering, with the safety systems lane-keeping assist and stability assist, is also available as an option.

Watch the Volvo FMX test drive: www.volvotrucks.co.za

https://youtu.be/don59edC4iY

VOLVO TRUCKS IDEAL FOR MINING OR QUARRYING OPERATIONS Volvo FMX: Built for tough terrain

Volvo FH16: Massive pulling power

Key product information • Power outputs: 330-520 hp • Safe and comfortable cabs in six sizes • Optimised for high capacity in demanding conditions • Flexible chassis for body-building

Key product information • Power outputs: 550-610 hp • Roomy and comfortable cabs in five sizes • Optimised for heavy combinations • Flexible chassis for body-building

Key features • I-Shift with ultra-low crawler gears • Tandem axle lift • 5-axle vehicles

Key features • I-Shift with ultra-low crawler gears • Tandem axle lift • 5-axle vehicles • Heavy-duty bumper

7

TRANSPORT, EQUIPMENT & LOGISTICS

Loaded with increased productivity and efficiency

Cat has unveiled its latest wheel loader model, the 992, which sets a new standard by offering up to 32% greater productivity.

T

his new large mining loader reduces maintenance costs by as much as 10% and offers up to 48% greater payload-per-fuel efficiency than the earlier 992K model.

Powered by the new Cat C32B engine with US EPA Tier 4 Final/EU Stage V and Tier 2 equivalent engine emissions options, the new 992 meets the global industry’s demand for high-production equipment with greater payloads. Powertrain design enhancements to the transmission, axles and final drive – along with the new engine – deliver a 20% longer interval for planned component replacement.

Offering both standard and high-lift configurations, the 992 delivers the lowest cost per tonne when paired with fleets of Cat 775, 777 and 785 trucks. Standard-lift payload capacities reach 23.1 t for quarry face applications and 27.2 t for loose materials handling, while high-lift capacities reach 20.4 t and 24.5 t in respective applications.

More productive and efficient A new Z-bar linkage optimised for performance and improvements to rimpull and breakout force deliver greater machine capacity and efficiency. In field testing, the 992 has demonstrated a greater payload-per-fuel

8

The 992 wheel loader delivers the lowest cost per tonne when paired with CAT’s 775, 777 and 785 dump trucks

efficiency of up to 48% in applications where a four-pass match to 90.7 t trucks was achieved, versus five passes with the 992K. The powerful and efficient 992 provides up to 9.5% more rimpull during digging and up to 20% more breakout force, increasing productivity.

The new Cat 992 Wheel Loader features an ondemand throttle mode to optimise payload-per-fuel efficiency without slowing production. New standard automatic retarding controls disable the impeller clutch, enable the lockup clutch, and use the implement and fan pumps to slow the machine on grade. The available advanced automatic retarding controls with engine brake feature offers full control of the loader’s speed on grade to maintain a desired hold speed.

Automating critical digging cycle elements, as well as optional new auto-dig components further improve productivity and efficiency while reducing tyre wear.

To stop slippage before it happens, a tyre-slip prevention feature reduces rimpull before the tyres are set and increases rimpull when downward force is applied to the tyre. The tyre set function detects pile contact and automatically lifts against the pile to set the tyres and increase available traction.

THE RESOURCEFUL MINING ISSUE | 2021

TRANSPORT, EQUIPMENT & LOGISTICS The lift stall prevention feature automatically manages rimpull in-dig to prevent hydraulic stall while lifting through the face, so the 992 spends less time in the pile.

Another optional feature is the new payload overload prevention that allows for productivity and efficiency improvements by providing a large enough bucket to be used to achieve target pass-match across a range of material densities without the risk of overload. With the overload value fully adjustable based on the target payload, this feature can be configured to automatically stop or slow the lift function when the overload value is exceeded.

Improvements to the setback and strike plane angles, a longer bucket floor, and a stronger and larger bottom section increase the bucket fill factor by 10%. The taller side plate with level top surface helps to improve visibility beyond the bucket edge to the material pile.

Operator coaching is available to empower operators to exceed productivity targets by measuring and providing feedback to teach proper operating techniques. Among other operating techniques, this feature shows how to properly shorten travel, avoid unracking in-dig, enter the pile with a level bucket, reduce the dump height, and use the kickout.

Elevated comfort and safety The newly redesigned Cat 992 cab increases visibility, offers intuitive control, and incorporates nextgeneration technology to boost efficiency by providing easily accessible information. Its taller windshield increases the glass surface area by 25%, resulting in

10% greater visibility. Operators will appreciate the cab’s 50% increase in legroom and more width around the knees.

Providing shift-long operating comfort, the new 992 controls feature electrohydraulic speed-sensing steering with force feedback. Two 254 mm colour LED monitors display machine control and operating functions. A separate 203 mm screen provides a dedicated viewing feed of the standard rear-view camera, upgradable with an optional 270-degree vision and object detection.

Low total cost of ownership Extended major component life on the new 992 and improved service access deliver up to 10% lower maintenance costs. Automatic lubrication to Z-bar linkage pins with robust guarding helps to deliver more reliable operation. A front walkaround platform simplifies the cleaning of cab windows.

Two large openings per machine side offer quick and convenient access to the improved cooling package, reducing cleaning time. The new loader also displays the remaining useful life for the engine air filter, enabling technicians to plan ahead for machine servicing.

Offering convenient and improved access to maintenance items, the service centre has been relocated to the left-hand side of the machine, along with the fuel tanks. SOS fluid sampling ports are safely accessed from ground level and filters are organised by type and change interval to increase maintenance efficiency.

The wheel loader is ideal for quarry applications in the mining industry

9

TRANSPORT, EQUIPMENT & LOGISTICS

LUBRICATION SYSTEMS FOR CONSISTENT MACHINE OPERATION The mining environment is very harsh, with machines and equipment often being exposed to rough conditions.

Lubrication systems play a critical role in reducing wear and tear on mining machinery.

L

incoln Lubrication South Africa has progressive automatic lubrication systems that are specially designed for the continual lubrication of stationary and mobile machines and systems.

They help machines operate sustainably even in harsh and unforgiving environments.

“The continuous delivery of the correct amount of lubricant to the correct points at the right time offers monumental savings for end customers,” says Joe Barnard, sales consultant, Lincoln Lubrication SA. “Alongside extended machine and equipment availability and lifespan, customers will also reap the benefits of increased uptime and productivity and reduced operational costs.”

P205 pump station with a 30 kg reservoir used for a new coal processing plant (Credit: Lincoln Lubrication SA)

10

Eliminating common problems By delivering the correct amount of lubricant, the progressive automatic lubrication system eliminates the common and costly problem of under- and overlubrication that is normally associated with inaccurate and irregular manual lubrication. Barnard explains that underlubrication can lead to component wear and tear and equipment failure, while over-lubrication is wasteful and pollutes the environment. “Furthermore, the utilisation of our lubrication systems will prevent unnecessary stoppages to perform lubrication tasks and manpower is no longer required to lubricate the points.”

A progressive automatic lubrication system consists of a pump connected to at least one primary metering device. Second-level metering devices can be connected to the outlets of the primary metering device if required, to increase the number of lubricated points, depending

THE RESOURCEFUL MINING ISSUE | 2021

on the pump’s operating pressure. The outlets of the primary and second-level metering devices are connected via branch lines to the lubrication points of the machine. The pump supplies lubricant to the metering devices with pressures of up to 550 bar, depending on the pump model. The metering devices split the lubricant into even or predefined amounts of lubricant (depending on the metering device), which are positively displaced to the lubrication points or to the inlet of a connected secondary metering device.

According to Barnard, these progressive systems can dispense a precise, metered amount of lubricant to up to 150 lubrication points over distances of approximately 15 m, depending on case values. For oil applications, even in connection with flow limiters, distances of over 100 m can be covered. Barnard goes on to explain that the progressive systems will provide continuous lubrication as long as the pump is in operation. “Once the pump stops, the pistons of the progressive metering device will stop in their current position and will carry on from there as soon as the pump starts supplying lubricant again. The progressive circuit of one outlet of the pump will stop when only one lubrication point is blocked, alerting personnel to service the system.”

Different applications These ultrareliable, robust progressive automatic lubrication systems do not miss a beat, even in the most stringent operating conditions such as potentially high lubrication-point back pressure, low temperatures and dirty, wet or humid environments.

The systems are extensively used in a wide range of small, medium and large machines and equipment.

They include mobile machines (wheel loaders, excavators and trenchers), construction machines (concrete and mortar pumps), agricultural machines (harvesters, balers, manure spreaders and sugar cane loaders), wood reclaimers, materials handling machines (reach stackers and crane carts), on-road trucks (waste press) and buses.

Lincoln secured an order to supply and install 13 progressive automatic lubrication systems at a newly built coal processing plant in Mpumalanga in April 2021. “The plant is building a new conveyor belt system with take-ups, pulleys, drives, etc., which will travel from the new mining area to the old, existing plant. This is a large area that requires lubrication and we will be installing the durable, versatile and reliable P205 and P215 525v pump stations with 30 kg reservoirs to meet the application requirements,” Barnard explains.

Additional applications of these versatile lubrication systems include hydro-electric plants, asphalt mixing plants, food and beverage facilities

P215 525v pump station with 30 kg reservoir able to meet lubrication requirements on a coal processing plant (Credit: Lincoln Lubrication SA)

(fillers and washing machines), quarries (screens and crushers), as well as in the oil and gas industry (reciprocating compressors).

Ideal solutions In order to recommend the optimum lubrication solution, including the best lubricant for each individual application, trained Lincoln application engineers will first determine a number of variables such as the number of lube points, back pressures at the lube points, operating temperature range, the feed pump’s drive energy, and control and monitoring. “We prescribe different lubricants – i.e. oil, fluid grease or grease – which have different viscosities to suit each application,” says Barnard.

The different types of oils include mineral, organic and synthetic, which are classified in ISO VG viscosity classes from 2 to 3 200. NLGI grade 000, 00 and 0 greases are known as fluid greases. Greases classified as NLGI grade 1-6 are consistent lubricants, which are soft to hard, triplecomponent mixtures of a base oil as the lubricating fluid, a thickening agent and additives. “In most instances, greases of NLGI grade 1 up to 3 are suitable for use in a lubrication system but we do recommend a compatibility check prior to using any oil or grease with our lubrication systems,” advises Barnard.

11

TRANSPORT, EQUIPMENT & LOGISTICS

Serious talk about SA rail President Ramaphosa highlighted in his presentation of the Economic Reconstruction and Recovery Plan (ERRP) to Parliament in October last year that rail lies at the heart of reviving South Africa’s economy. By Mesela Nhlapo*

12

THE RESOURCEFUL MINING ISSUE | 2021

TRANSPORT, EQUIPMENT & LOGISTICS

A

s part of government’s rail drive, the move to introduce third-party access to the country’s railway network is one of the most significant policy developments in recent years.

Minister of Finance Tito Mboweni is clear: rail has supported the economy for decades. Now, with infrastructure needing repairs or replacement, partnerships with the private sector and other players are critical.

Rail has long been the backbone of the South African logistics and transport value chain, and will become even more critical in a post-Covid-19 environment. It is cheaper, cleaner and more efficient than road transport, and lends itself to carrying cargo in a sanitised, minimalcontact environment.

The case for rail, we believe, is clear and compelling.

Rail remains the most viable option for the transportation of freight like grain, automotive components and fully built car units, and minerals. It will reduce road congestion, and free our roads up to carry commuter traffic and sensitive cargo like perishables and cold storage items.

Rail infrastructure upgrade Rail infrastructure has been a neglected area of infrastructure investment for decades. It has lagged in areas such as energy, which has seen the construction of new power stations, and has had to compete with other infrastructure sectors for investment.

In the meantime, the continent is looking to South Africa for leadership. At the African Union’s 24th

Mesela Nhlapo (Credit: Adele D Photography)

13

TRANSPORT, EQUIPMENT & LOGISTICS

It is time to get all stakeholders around the table to get our rail industry driving our economy forward

ordinary session in Addis Ababa in 2015, South Africa was identified as a manufacturing hub for railway and rolling stock equipment. The formation and operationalisation of the African Continental Free Trade Agreement will require the support of a vibrant rail sector to be fully realised. It is time for us to lead.

At the African Rail Industry Association (ARIA), we’re busy engaging government to restart an overdue conversation about railway infrastructure. ARIA represents a range of rail industry stakeholders, including original equipment manufacturers, rail component manufacturers, operators, and services companies.

Critical stakeholder collaboration ARIA’s proposal is to create a formal structure – the Rail Advisory Committee (RAC) – which would bring together the rail industry, government, development

14

and the private finance community, as well as labour and the skills development and training fraternity.

The RAC would support government’s efforts in areas to shape policy and legislation to guide the evolution of rail operations and safety standards. It would address legacy issues affecting the size and structure of the rail industry in South Africa, and obstacles to the growth of the industry.

It also would boost the ability of Transnet and the Passenger Rail Agency of South Africa to drive economic growth and transformation. It would assist in ensuring freight’s third-party access to Transnet’s network, which is a key element of government’s ERRP. It is time to get all stakeholders around the table to get our rail industry driving our economy forward. It is a conversation we cannot afford to delay. *Mesela Nhlapo has over 20 years of experience in manufacturing and technical business development.

THE RESOURCEFUL MINING ISSUE | 2021

TRANSPORT, EQUIPMENT & LOGISTICS

Road trains

LEAD THE WAY

in road freight haulage innovation

Unitrans Supply Chain Solutions, a 60% black-owned South African company, has been at the forefront of the road freight industry for more than half a century.

T

he Mining Division within Unitrans strives to be the safest and most innovative operator in the industry and has a proud track record that proves this. In addition to significant payload increases in its transportation methodology, this translates into decreased rates per tonne, as well as reduced environmental impact and carbon emissions.

With 18 road trains serving South Africa, a new concept introduced in 1984 made remarkable improvements to Unitrans’ offering. “Initially, we added a dolly to a bottom dump interlink trailer combination in 1989, which increased the payload from 34 tonnes to 45 tonnes,” says Kobus Burger, operations executive: Mining Division.

The idea was based on the need to reduce the number of trucks on the road. “By increasing payload capacity, we have been able to decrease the size of our fleet. This has reduced the on-road risk and the number of trips – we were using dirt roads and travelling in the rural areas surrounding the mines at the time.”

Australian concept, locally made Burger explains that the concept is from Australia, but the vehicles are built in South Africa. “We have done a lot of development since inception. In 1994, we introduced four-trailer road trains measuring 42.7 m in length for one of our key mining clients. This reduced their fleet from 16 vehicles to 9 – almost half, due to the increased payload.”

Australia has road trains with five to six trailers and they run simulations on safety, speed and capacity before the vehicles are approved and built in South Africa, to comply with Performance-based Standards

(PBS) – a regulatory system for heavy vehicles in South Africa.

Automated controls and full service offering In terms of functionality, the road trains are superefficient. All controls are inside the cab, with a panel of buttons and levers that include offloading as well as opening and closing the tarpaulin. Nothing is done manually. “We continue to refine the technology through trial and error, making ongoing improvements to stay ahead of the curve.”

The Unitrans Operational Excellence Control Tower uses highly sophisticated technology and is manned 24/7, with vehicle tracking and driver risk management software.

This includes vehicle tracking, onboard cameras, inside the cab and externally, and fatigue management. Burger says fatigue is a huge cause of accidents. “This way, we can manage driving style and on-road behaviour. This ensures compliance with our fuel cost saving initiatives and increases productivity.”

Unitrans also provides front-end loaders, excavators and graders, materials handling, load and haul services, as well as on- and off-mine equipment. “In addition, we’re looking to partner with specialist companies in drill and blasting as well as crushing and screening operations. This will offer clients a holistic package.

They will be able to deal with one contractor who can manage a number of aspects of their business.”

Through significant investment in technology and skills in recent years, coupled with innovative approaches to customer challenges, Unitrans is pioneering change and innovation in the mining and transport industries, delivering solutions and blazing a trail for industry best practice.

We continue to refine the technology through trial and error, making ongoing improvements to stay ahead of the curve.”

15

INNOVATION · EXPERTISE · DELIVERED Creators of Innovative Supply Chain Solutions in Mining since 1962

Unitrans Supply Chain Solutions (Pty) Ltd CAPE TOWN HEAD OFFICE Block W, Greenford Office Park, Punters Way, Kenilworth 7700 Tel: +27 21 762 0061

www.unitrans.co.za

THE RESOURCEFUL MINING ISSUE | 2021

TRANSPORT, EQUIPMENT & LOGISTICS

Advanced fire protection for mining vehicles In the mining industry, safety has always been a crucial issue – not least when it comes to fire.

Dafo Vehicle Fire Protection offers a complete range of fire detection and fire suppression systems for vehicles.

S

afety has always been a crucial issue in the mining industry – not least when it comes to vehicle and equipment fires.

Fires in vehicles often have a very intense development and are difficult to extinguish with a portable fire extinguisher. With the correctly dimensioned automatic fire suppression system, you get quick and effective protection that limits the consequences of a fire and gives vital time to evacuate – which can be vital in a mine. Fire protection in heavy vehicles such as mining machines places high demands on both equipment and durability.

The vehicles operate in the toughest of environments, not least because of dust, the vibrations, and the extreme temperatures they are exposed to. “Therefore, we offer high-tech, customised solutions with associated service agreements. This is also why we continuously invest a great deal in the development of our products and systems,” explains Johan Balstad, vice president, Dafo Vehicle.

Fire safety important part of operators’ sustainability work The complexity is so extensive that Dafo Vehicle’s experts are also involved and assist in the design and planning of the vehicles of the manufacturer, to create well-integrated and efficient solutions. From the industry side, fire safety is often seen as a crucial issue and an important part of the sustainability work.

“First of all, you want to eliminate or minimise the risk of personal injury – that is the most important factor and where fire protection is central,” Balstad says. He adds that it is also about avoiding downtime due to fires or other types of accidents, which can be problematic, costly, and timeconsuming to rectify in a mining environment.

Therefore, it becomes especially important that the systems and equipment work as intended.

A Dafo Vehicle CO sensor (Credit: Dafo Vehicle)

Fire protection system for electric and hybrid vehicles “Right now, development is particularly important, as we are facing a significant transition in terms of machine fuel. There is extensive electrification in the mining industry as well, and it places new demands on the fire protection equipment to some extent,” Balstad explains. He adds that a battery that catches fire through thermal runaway is not the same as the more traditional fires in diesel- or petrol-powered vehicles.

Dafo Vehicle has launched a fire protection system for electric and hybrid vehicles that is activated before a fire in a battery occurs. The fire protection solution has been developed for buses but will also be available for other heavy electric vehicles.

Low or non-existent emissions, cost-effective operation, and reduced noise levels are some

17

TRANSPORT, EQUIPMENT & LOGISTICS

A well-integrated fire suppression system minimises the risks of costly downtime brought on by fire (Credit: Dafo Vehicle)

of the major advantages of hybrid and electric vehicles today – but the disadvantages of the technology, when something goes wrong, are less known. Fires in the lithium-ion batteries of electric vehicles usually progress rapidly and are very difficult to extinguish.

Anders Gulliksson, technical manager, Dafo Vehicle, says that the organisation has followed vehicle developments closely and seen an increased need for fire protection as more electrified vehicles are being introduced to the market. “Dafo Vehicle was concerned early on regarding the potential fire risks and dangers this technology would bring, which meant that we also started looking at solutions to meet the development.”

Dafo Vehicle offers a complete fire protection system for electric and hybrid vehicles. The patented and award-winning suppression system was developed through an EU-funded research project – Li-IonFire – and initially aimed at electrified buses in public transport.

Gulliksson explains that the system is an advanced fire suppression system with a fire prevention part integrated into the system.

“This means that the system can detect any temperature changes in the lithium-ion battery at an early stage and cool it down before reaching the critical ‘thermal runaway’ state, which can

18

result in the battery starting to burn and a fully developed fire occurring,” he says.

High risk of toxic emissions According to Gulliksson, there are currently no successful methods to extinguish a battery that has already caught fire and entered the thermal runaway stage, after an overcharge or vehicle collision. If the battery starts to burn, the highly toxic gas emits hydrogen fluoride (HF), which can cause serious damage to both the skin and respiratory tract.

“In the long term, our suppression system can be used for various electric vehicles and areas, such as heavy-duty mobile equipment vehicles in the mining industry and ports,” Balstad explains.

The main reason for this, he adds, concerns the high safety requirements in the industry; however, fire protection also minimises the risks of costly downtime due to a fire.

The new Li-IonFire fire protection system will detect potential battery failure, at the earliest possible stage, and take immediate action by spot cooling, using the suppression agent Forrex EV. This will effectively stop, or delay, a potentially hazardous situation without the fire developing further. It can also potentially boost the safety of operators, the protection of valuable assets, and allow for the safe evacuation of drivers.

THE RESOURCEFUL MINING ISSUE | 2021

TRANSPORT, EQUIPMENT & LOGISTICS

Unbottling

minerals processing plants

It is not uncommon to find multimillion-rand processing plants with enormous production potential being severely restricted by poorly specified or old-fashioned screening media.

P

rovided that the plant is fully operational and appropriate for the job, the screen is the usual culprit that slows production or leads to unacceptably high levels of downtime. Fortunately, with the right expertise and best products for the job, help is at hand for these ailing operations. Minerals processing equipment supplier ELB Equipment – in partnership with internationally acclaimed screen media manufacturer Major Wire – has spent several years fixing screening problems at an almost endless array of processing plants.

Waynne Martin, technical sales representative at ELB Equipment, says this partnership with the world’s leading supplier of screen media enables the company’s technical teams to identify the source of a screening problem and provide solutions to bring the equipment back up to the required spec and even further improve on its performance through the use of a wide range of Major Wire screen solutions for practically any application.

Success stories Examples of the type of improvements obtained with Major Wire screens in the mine and quarrying industry include a recent instance where imported anthracite was difficult to process due to its ‘sticky and wet’ consistency, grinding down production to a tortoise-pace. The introduction of a carefully selected Major Wire tensioned screen immediately boosted production by 50%, with a host of other benefits to boot.

More recently, a simple upgrade of traditional paneltype mesh screens to Major Wire’s Flex-Mat screens enabled a major diamond producer to reduce carryover by more than 15%. Similarly, one of the country’s largest cement producers was able to improve the production feed rate of highly abrasive dolomite to 360 tonnes per hour (tph) from its previous 180 tph.

Simultaneously, carry-over was reduced from 35% to zero, and the panels’ wear-life was improved from seven weeks to more than 11 months. The enormous wearlife capabilities eventually led to a further reduction of wire diameter for an even greater open area, while maintaining a lifespan of more than six months. It also reduced up to an hour of maintenance per shift.

Another recent success story worth mentioning is that of a metal recovery plant experiencing severe pegging and blinding issues where the screen needed to be cleaned manually by workers wielding picks and hammers for at least two hours per day. A simple upgrade to a Major Wire tensioned screen solved the problem and no cleaning has since been required. A similar case reduced a major coal mine’s screening costs from R0.63/t using woven wire screens to just R0.23/t using Major Wire Flex-Mats.

According to Martin, ELB’s partnership with Major Wire has enabled the company to provide comprehensive product and service offerings for all customer requirements. “As with all the brands and equipment provided by ELB Equipment, Major Wire is the best-of-breed manufacturer of screening media in the world,” he concludes.

A screen is a critical element of a mine’s processing plant

19

ALTERNATIVE ENERGY

Clean energy demand for critical minerals set to soar According to a new report by the International Energy Agency (IEA), supplies of critical minerals essential for key clean energy technologies like electric vehicles and wind turbines need to pick up sharply over the coming decades to meet the world’s climate goals.

A

special report, The Role of Critical Minerals in Clean Energy Transitions, is a comprehensive global study on the central importance of minerals such as copper, lithium, nickel, cobalt and rare earth elements in a secure and rapid transformation of the global energy sector. The report recommends six key areas of action for policymakers to ensure that critical minerals enable an accelerated transition to clean energy rather than becoming a bottleneck.

“Today, the data shows a looming mismatch between the world’s strengthened climate ambitions and the availability of critical minerals that are essential to realising those ambitions,” says Fatih Birol, executive director of the IEA. “The challenges are not insurmountable, but governments must give clear signals about how they plan to turn their climate pledges into action. By acting now and acting together, they can significantly reduce the risks of price volatility and supply disruptions.”

The special report, part of the IEA’s flagship World Energy Outlook series, underscores that the mineral requirements of an energy system powered by clean energy technologies differ profoundly from one that runs on fossil fuels. A typical electric car requires six times the mineral inputs of a conventional car, and an

20

onshore wind plant requires nine times more mineral resources than a similarly sized gas-fired power plant.

Addressing potential vulnerabilities Birol adds that if potential vulnerabilities are not addressed, they could make global progress towards a clean energy future slower and more costly – and therefore hamper international efforts to tackle climate change. “This is what energy security looks like in the 21st century, and the IEA is fully committed to helping governments ensure that these hazards don’t derail the global drive to accelerate energy transitions.”

Demand outlooks and supply vulnerabilities vary widely by mineral, but the energy sector’s overall need for critical minerals could increase by as much as six times by 2040, depending on how rapidly governments act to reduce emissions. Not only is this a massive increase in absolute terms but, as the costs of technologies fall, mineral inputs will account for an increasingly important part of the value of key components, making their overall costs more vulnerable to potential mineral price swings.

The commercial importance of these minerals also grows rapidly: today’s revenue from coal production is 10 times larger than from energy transition

THE RESOURCEFUL MINING ISSUE | 2021

ALTERNATIVE ENERGY

minerals; in climate-driven scenarios, however, these positions are reversed well before 2040.

Producing the report To produce the report, the IEA built on its detailed, technology-rich energy modelling tools to establish a unique database showing future mineral requirements under varying scenarios that span a range of levels of climate action and 11 different technology evolution pathways.

In climate-driven scenarios, mineral demand for use in batteries for electric vehicles and grid storage is a major force, growing by at least 30 times by 2040. The rise of low-carbon power generation to meet climate goals also means a tripling of mineral demand from this sector by 2040. Wind takes the lead, bolstered by material-intensive offshore wind. Solar PV follows closely, due to the sheer volume of capacity that is added. The expansion of electricity networks also requires a huge amount of copper and aluminium.

Unlike oil – a commodity produced around the world and traded in liquid markets – the production and processing of many minerals such as lithium, cobalt and some rare earth elements are highly concentrated in a handful of countries, with the top three producers accounting for more than 75% of supplies. Complex

and sometimes opaque supply chains also increase the risks that could arise from physical disruptions, trade restrictions or other developments in major producing countries. In addition, while there is no shortage of resources, the quality of available deposits is declining, as the most immediately accessible resources are exploited. Producers also face the necessity of stricter environmental and social standards.

The IEA report provides six key recommendations for policymakers to foster stable supplies of critical minerals to support accelerated clean energy transitions. These include the need for governments to lay out their long-term commitments for emissions reduction, which would provide the confidence needed for suppliers to invest in and expand mineral production. Governments should also promote technological advances, scale up recycling to relieve pressure on primary supplies, maintain high environmental and social standards, and strengthen international collaboration between producers and consumers.

Follow this link to access the report The Role of Critical Minerals in Clean Energy Transitions: https://iea.blob.core.windows.net/ assets/278ae0c8-28b8-402b-b9ab-6e45463c273f/ TheRoleofCriticalMineralsinCleanEnergyTransitions.pdf

21

ALTERNATIVE ENERGY

Greg Blandford is a director: Energy & E-Mobility at Rubicon

Sufficient, consistent power supply lies at the heart of a successful mining operation. Power cuts and increases in electricity costs have led mining companies to explore alternative energy sources. Dineo Phoshoko speaks to Greg Blandford, director: Energy & E-Mobility, Rubicon, on his views about alternative energy in the mining industry.

How possible is it for mines to go completely off the grid and continue to operate efficiently?

GB It is possible, in theory, but there are numerous challenges in going completely off-grid, including the cost hurdle. A full off-grid system for a mine may employ complementary renewable technologies such as partsolar, part-wind energy, along with a substantial energy storage system. It is possible but the costs to implement can sometimes be prohibitive.

What would be some of the challenges associated with relying on alternative energy sources for mine operations?

Mines typically operate 24/7 and rely on constant power supply for operations, which include essential services such as air supply down mine shafts for miners, lighting and running heavy mining machinery.

In many cases, mine operations generate dust that, once airborne, settles on solar panels and reduces their efficiency. If a solar installation experiences prolonged cloudy or rainy days, electricity production can be negatively affected. These are the main issues that impact on the reliability of solar installations, among others.

What would be the best way to get around those challenges?

In the above-mentioned case, regular cleaning to ensure good energy production and other regular maintenance would mitigate most of the issues.

22

In addition to providing electricity for the mine, would alternative energy have the capacity to provide electricity to mines’ host communities?

Yes, if the scale of the project allows for extra power generation, then communities surrounding the mine could benefit from the additional capacity.

What role do you see alternative energy playing in South Africa, beyond mining?

Renewables will form a large part of our energy mix in years to come. As we see more integration of energy technologies including energy storage, solar, wind, e-mobility and other forms of renewables. We can already see a huge demand for residential solar paired with energy storage products with some form of monitoring, which give end users control and insights of their energy usage. The e-mobility wave is coming, and we need to prepare for this and include large-scale renewable energy projects in our utility power mix.

Is the current infrastructure available in the country enough to support and maintain alternative energy in South Africa?

Yes and no. Our infrastructure is poor due to a lack of maintenance and large-scale corruption within our state utility. We do need to build additional infrastructure along with the increased capacity and have a good, maintained network that will lead to a sustainable energy network for all.

THE RESOURCEFUL MINING ISSUE | 2021

ALTERNATIVE ENERGY

SOUTH DEEP MAKES HISTORY Gold Fields is on course to becoming the first mine in South Africa to build and operate its own solar plant through the South Deep Solar Project. By Dineo Phoshoko

T

he 40 MW solar plant will generate over 20% of the average electricity consumption of the mine and will include 116 000 solar panels, covering 118 hectares. The cost of the plant is estimated at R660 million, with construction expected to begin in Q2 2021.

Once commissioned during Q2 2022, the selfgenerated renewable energy plant will save the

mine approximately R120 million in electricity costs. Minerals Council South Africa notes that self-generation projects have the potential to contribute significantly towards easing electricity supply constraints in South Africa, while improving the competitiveness of the mining sector by reducing the cost of electricity and the industry’s carbon footprint.

23

ALTERNATIVE ENERGY

The need to transition to greater renewable energy use is not simply a mining or South African issue – it is a global concern

24

Going off the grid Although the mine will continue to remain on the grid for most of its electricity needs, the project will demonstrate that mines can become successful independent power producers (IPPs).

There is still a lot of ground work to be done before South African mines can get off the grid.

Speaking to Inside Mining, Martin Preece, executive vice-president, Gold Fields South Africa, says that, in order to move off-grid completely, each operation must ensure that sufficient sources of power are available to continue normal operations without interruption. He explains that the biggest challenge in this regard is to do so cost-effectively.

Preece mentions that the energy mix at each mine will differ depending on the sources of renewable energy and the need to supplement these with diesel for gas-driven generators.

As such, over the long term, the solution is for hydrogen and battery storage solutions to evolve to become more cost-effective, which will allow for the use of solar power during the day while storing energy for use at night.

“In our view, these options are not yet costeffective; this will change over time, however, as technology progresses and the use of renewable energy increases. At the moment, the most cost-effective storage solution is to feed excess electricity into the national grid for later consumption,” Preece says.

Regulatory challenges The regulatory process has been identified as a major stumbling block for generating and implementing renewable energy at mines. During his State of the Nation Address earlier this year, President Cyril Ramaphosa mentioned that renewable energy had the potential to ease the strain on South Africa’s power supply. He did also acknowledge that easing the licensing requirements for new embedded generation projects could unlock up to 5 000 MW of additional capacity.

Preece suggests that further regulatory reforms to streamline the process of regulatory approval and licensing of self-generation electricity projects are required to reduce red tape and enable shorter timelines. In addition, increasing the cap from 10 MW to 50 MW will bring significant capacity online and will help to ease electricity supply constraints in South Africa.

“For larger mining houses, the need to wheel power and capture economies of scale with larger, more cost-effective projects is critical. Cost-effective storage options need to be found. At the moment, a viable option is to feed electricity into the grid for night-time consumption.”

Licence application process On 25 February 2021, the National Energy Regulator of South Africa (Nersa) granted Gold Fields a licence for the solar project. “Ours is an owner build and operate model; under that model, we applied for

our licence on the basis of self-generation for selfconsumption in June 2020,” explains Preece.

“We applied for the licence and submitted our technical and economic study, as well as the approved environmental authorisation. This was followed by a number of interactions with the regulator to provide further details or to address technical and other questions where required.”

Gold Fields also included Eskom in the application process and requested the power utility to provide input and consent. “This was followed by a public input process led by Nersa. The Nersa technical committee considered our application and made a recommendation to its board,” Preece says. The entire licence application process took just under a year to complete.

Having successfully obtained its licence, Gold Fields learnt some valuable lessons from the application process. According to Preece, the licensing process cannot be outsourced and needs to be led and owned by the business. “It is important to clearly understand the expectations and requirements, and to build sound working relationships with all parties to ensure these expectations and requirements are met.”

Future projects Apart from South Deep, Gold Fields has two other mines in Africa – Tarkwa and Damang, both in Ghana.

Preece states that there are future energy plans for these mines, including renewable sources, particularly solar. “However, this is not a short- to medium-term

priority, as the two mines have dedicated gas plants that provide all their current electricity needs.”

He highlights that while the use of renewable energy will go a long way in easing the electricity supply constraints impacting all aspects of the economy, the need to transition to greater renewable energy use is not simply a mining or South African issue – it is a global concern.

“We are very excited about the project and extremely proud of the difference it is going to make to our mine and the group’s de-carbonisation efforts, as well as the contribution it will make to the sustainability of our business,” Preece concludes.

Martin Preece is the executive vicepresident of Gold Fields South Africa (Credit: Gold Fields)

25

Delivering value to the mining industry

At Veolia, we understand the need for efficiencies, cost-effectiveness and most importantly safety in mining operations.

We aim to offer water, waste and energy solutions that not only positively impact the bottom line, but are sustainable and good for the environment. www.veolia.co.za info.southafrica@veolia.com +27 11 663 3600

THE RESOURCEFUL MINING ISSUE | 2021

ALTERNATIVE ENERGY

SA’S GREEN HYDROGEN POTENTIAL South Africa’s Hydrogen Society Roadmap is expected to be submitted to Cabinet for approval by early 2022. What does this mean for our country’s energy sector?

T

he Hydrogen Society Roadmap will explain how the country’s resources – including reliable sources of renewable energy such as solar and wind, as well as its ample supply of platinum group metals (PGMs) – can be effectively harnessed to produce green hydrogen.

According to Kieran Whyte, partner and head: Energy, Mining and Infrastructure Practice at Baker McKenzie in Johannesburg, South Africa began the process of creating policy for the green hydrogen market by implementing the Green Hydrogen Atlas-Africa initiative in July 2020. As part of this, the Roadmap is intended to provide a guide for the country’s transition to a hydrogen-based energy system. The Roadmap will be a policy document outlining the costs, challenges, gaps, benefits and potential of green hydrogen, with the aim of eventually incorporating this into the country’s renewable energy plan.

Exploring hydrogen opportunities A report by global law firm Baker McKenzie – Shaping Tomorrow’s Global Hydrogen Market – outlines how, despite regulatory challenges, legal complexity and the

South Africa’s PGMs supply is advantageous for the development of a hydrogen market

current lack of incentives to invest in decarbonised hydrogen without government support, important opportunities exist for businesses seeking to reap firstmover advantages.

In Whyte’s opinion, South Africa’s green hydrogen potential could produce significant advantages for investors and the country, but legal certainty is needed, and infrastructure shortfalls must be addressed. “While it is still early in the process, transactions have begun around the world and investors are starting to look at what governments are doing to support hydrogen initiatives. As such, the Roadmap is eagerly anticipated by the energy sector,” he says.

Baker McKenzie’s report outlines

Kieran Whyte believes that South Africa’s green hydrogen potential could produce significant advantages for investors and the country (Credit: Baker McKenzie)

27

ALTERNATIVE ENERGY Clear policy and a regulatory environment that encourages investment will enable South Africa to be part of this energy transition and benefit considerably from exporting green hydrogen to other parts of the world.”

how countries have been rapidly concluding that a successful decarbonisation path cannot solely rely on renewable electricity and that a zero-carbon hydrogen solution is needed. The report explains how governments around the world are supporting decarbonised hydrogen, as they did with renewables, to drive down cost.

For example, the report outlines how hydrogenrelated research and development (R&D) budgets in China, the EU and Australia, for example, are on the rise. In 2018, funding for hydrogen-related technology research and pilots increased by 8%, representing more than US$50 billion (R720 billion). This rise in global R&D funding can be largely attributed to an increase in spending from China, whose budget almost quintupled in only three years.

Hydrogen strategies internationally In 2021, the EU is expected to institute a long-lasting and ambitious hydrogen research programme as part of Horizon Europe, including a new ‘European Partnership’ for hydrogen. This partnership is, in essence, an R&D association specifically dedicated to hydrogen research and whose objective is to address ‘Market failure for first movers’.

Australia adopted a National Hydrogen Strategy in 2019, which sets a path to build Australia’s hydrogen industry. The government plans to accelerate the commercialisation of hydrogen, reduce technical uncertainties, and build up its domestic supply chains and production capabilities. The Australian Renewable Energy Agency has identified renewable hydrogen as one of its three investment priorities.

In 2019, Japan adopted a new strategic roadmap for hydrogen, making the development of hydrogen technology one of its centrepieces. It is working towards decreasing the cost of decarbonised hydrogen production tenfold by 2050. Also in 2019, South Korea announced its Hydrogen Economy Roadmap and Ulsan’s Future Energy Strategy, with a primary focus on leading the hydrogen vehicles and fuel cell industry, as well as establishing a system for hydrogen production and distribution.

Working towards decarbonisation Whyte explains that hydrogen is considered to be essential in South Africa’s new energy mix, due to its important role in combatting climate change and delivering on decarbonisation targets.

The Baker McKenzie report shows that there is a growing consensus among academia, industry and political leaders that a decarbonisation path based almost exclusively on electricity networks (an ‘electricity only’ model) is unrealistic and would be too expensive.

Deep decarbonisation will require hydrogen to satisfy

28

current industrial demand – no molecules, no deep decarbonisation.

Clean hydrogen also allows countries to meet the goals outlined in the Paris Climate Agreement. The report notes that hydrogen is a way for countries to reduce emissions and limit global warming to below 2°C. The report notes that within just a few decades, all the world’s energy needs – electricity, industry, transport, buildings and agriculture – will have to come from carbon-free sources. This will require huge changes in little more than a single generation, and will need innovative solutions, technologies and policies. Hydrogen will play a crucial role in making this fundamental change to the globe’s energy systems.

The current hydrogen market is already big and growing, with total demand listed in the report at around 115 million tonnes in 2018, representing $135.5 billion (R2 trillion). Hydrogen also holds longterm promise and is expected to reach $25 billion (R360 billion) by 2030. Future applications include road transport, maritime and air transport, buildings, and energy-intensive industries.

THE RESOURCEFUL MINING ISSUE | 2021

ALTERNATIVE ENERGY

Whyte notes that South Africa has an excellent renewable energy capacity, especially in wind and solar, which can be used to generate the energy needed to split water into hydrogen and oxygen. However, the current renewable energy programme will have to be upscaled to increase capacity.

“Additionally, clear policy and a regulatory environment that encourages investment will enable South Africa to be part of this energy transition and benefit considerably from exporting green hydrogen to other parts of the world. Green hydrogen could also be utilised to grow South African’s clean energy supply via a decarbonised energy system,” he adds.

Optimising green hydrogen in SA “To export green hydrogen, South Africa needs to develop the infrastructure necessary to store and transport the product. And while capital outlay and investment are needed, jobs could also be created by new income-generating ventures,” says Whyte.

So far, developments in the hydrogen market in South Africa have mostly come through the mining sector.

The country’s ample supply of PGMs is an advantage, as these can act as catalysts during the electrolysis process that converts water into hydrogen and oxygen. As such, a zero-carbon hydrogen solution is one of the key evolving end-uses for PGMs. Whyte explains that new solutions are urgently needed to address Africa’s power crisis and boost its post-pandemic recovery. Such solutions must consider the energy transition and the global drive towards a decentralised, decarbonised and secure energy supply that addresses climate change and stimulates economic growth. “Green hydrogen can lower energy costs, increase the power system’s flexibility and facilitate the decarbonisation of African industries. Its benefits are ample and the opportunities it will create – not only for South Africa but other African countries – look very promising,” he concludes.

Follow this link to access the report Shaping Tomorrow’s Global Hydrogen Market: https://www.bakermckenzie.com/-/media/files/insight/ publications/2020/01/hydrogen_report.pdf?la=en

29

ALTERNATIVE ENERGY

Integrating

ALTERNATIVE ENERGY into mining operations

An in-depth overview of how the mining industry is responding to climate change while staying competitive.

By Dr Theo Acheampong*

W

e live in extraordinary and exciting times. The Covid-19 pandemic and accompanying great lockdown of 2020-21 has been a time and crisis like no other. Several bodies, including the IMF, forecasted one of the worst economic downturns since the Great Depression of the 1930s.

The pandemic has dramatically impacted livelihoods and economies. Within the energy and metals industry, it has profoundly impacted disrupting energy markets. For example, shocks from the pandemic led to reductions in fossil-backed consumption and emissions in 2020, with the International Energy Agency estimating that energy demand is set to drop by 5% and energy-related CO2 emissions by 7%.

This is further corroborated by Global Carbon Project and Africa Energy Chamber projections, which estimate a 7% (2.4 gigatonnes of CO2) fall in emissions in 2020 compared to 2019 – the biggest relative drop since 1945. In a related development, traded prices of key primary base metals such as copper and zinc witnessed reductions in the early phase of the pandemic due to temporary mine closures and a reduction in supply capacities. These eventually rallied in the latter part of the year on improved economic prospects, with global vaccination campaigns kick-starting.

However, the pandemic has also brought to the fore some of the structural shifts that had been taking place in the mining industry pre-pandemic, such as the increasing adoption and use of renewable energy to power some aspects of mining operations. This trend, we think, will only increase, given the extended pressure on governments and industry to decarbonise

30

their operations in order to meet the Paris climate goal target of limiting the increase in global average temperature to well below 2°C above pre-industrial levels by 2050. It is important to state that the mining industry accounts for 22% of global industrial emissions, according to the latest BloombergNEF estimates. Thus, there is more pressure on industry to decarbonise operations.

Evolving markets The majority of clean energy procurements by mining companies are concentrated in a few markets such as Chile (4.4 GW), Mexico (580 MW), Zimbabwe (180 MW) and Brazil (150 MW). And in terms of companies, BHP is the largest buyer, signing two power purchase agreements in Chile – totalling an estimated 2 000 MW – to power its copper mining operations. Anglo American recently announced it will source 100% renewable energy for all its operations in Brazil, Chile and Peru. In South Africa, Gold Fields has approved a R660 million construction of a 40 MW solar plant to meet 20% electricity consumption of its South Deep mine.

Figure 1 shows some mining industry renewable energy procurements since 2008. What is interesting from the data is that almost 75% of the combined 5.9 GW of clean energy procured by miners over the period only took place since 2018 – this was pre-pandemic.

Three factors are driving the fast adoption of renewable energy by mining companies in Africa: the unreliability of the continent’s grid, greenhouse gas emissions reduction, and lowering operational costs.

According to the International Renewable Energy Agency (IRENA), electricity costs from renewable

THE RESOURCEFUL MINING ISSUE | 2021

To successfully roll out renewable energy projects at mines, companies must first assess how much of their electricity demand can be met off-grid

FIGURE 1 M ining industry renewable energy procurement mechanisms – 2008 to 2019 (Credit: BloombergNEF)

energy sources have fallen rapidly over the last 10 years. The main factor driving the reduction in costs is technology improvement, mass adoption, growing expertise and competition.

Since 2010, utility-scale solar photovoltaic energy costs have dropped by 82% (Figure 2). Concentrated solar power has also fallen by 47%. Onshore and offshore wind have declined by 39% and 29%, respectively. Such drops in costs have made renewable energy sources cost-competitive with fossil-fuelled alternatives in most countries today for newly built utility-scale projects.

Dr Theo Acheampong is an African Energy Chamber thought leadership contributor who has worked on numerous Chamber publications

As an advantage, mines operating off-grid can hedge against the volatility of fuel prices for diesel used to power their generators by switching to renewable energy. Companies can also share excess power with host communities to further build trust and goodwill, or sell excess power to the grid.

As noted earlier, the mining industry contributes about 22% of global emissions from industrial processes. These emissions would have to drop as host countries lay out plans to reduce their emissions over the medium to long term. Europe, for example, has implemented carbon taxes to deter companies from emitting greenhouse gases. Investing in renewable energy today could help reduce emissions significantly and insulate mining companies from such carbon penalties, should their host countries decide to put a price on carbon emissions.

Strategies to integrate RE projects with mining operations There are four main strategies mining companies can employ to integrate renewable energy projects

31

ALTERNATIVE ENERGY

FIGURE 2 Global levelised cost of energy from newly commissioned utility-scale renewable power generation technologies – 2010 to 2019 (Credit: IRENA)

32

with their operations. First, on-site generation where the mining company builds, owns and operates the power plant on-site to meet its electricity demand and, if there is excess, share with host community or sell to the grid. Mining companies can meet about 25% of their electricity demand through such an arrangement. This is capital intensive and would require the mining company to develop its in-house expertise to run both the mine and the power plant.

Second, a mining company can choose to become an independent power producer by building a power plant off-site and feed it to the grid. Third, miners can also host an independent power producer on-site to develop and operate the power project on behalf of the mining company. Finally, a mining company can enter into a power purchase agreement with an established renewable energy producer to purchase power under a contract over a period of time at a pre-determined price. This arrangement, which is the most popular among mining companies, enables them to meet up to a 100% of their electricity demand through renewable energy.

companies must determine if their chosen renewable energy technology aligns with the mine’s electricity demand profile. A mine that operates on a 24-hour shift will not be able to meet its electricity demand at night using solar; it can, however, be complemented with battery storage. Third, companies must also work within the local regulatory framework of the host country. Some countries have strict requirements for mining companies aiming to develop utility-scale power projects.

In South Africa, the licence-exemption cap to develop a new power facility remains at 1 MW. Any project beyond this threshold will require a licence from the National Energy Regulator of South Africa designed primarily for utility-scale projects. This regulation makes it difficult for a mine to develop a utility-scale energy project to meet its demand.

Finally, companies must consider the optimal financing option available, to ensure they can access the lowest cost of capital, especially for renewable energy projects that will be independently developed by the mining company.

Way forward To successfully roll out renewable energy projects at mines, companies must first assess how much of their electricity demand can be met off-grid. Second,

*Dr Theo Acheampong is an economist and political risk analyst with over 10 years’ knowledge and experience working with national governments and international institutions.

THE MOST

Beautiful SHOE IN SOUTH AFRICA?

MAXECO CELEBRATES 30 YEARS. HAS ANY BOOT DONE MORE TO BUILD OUR COUNTRY? For 30 years, Maxeco has helped build a nation with the world’s toughest workforce. Across construction sites, mines, farms and factories, almost 10 million pairs have helped realise the dream of a stronger South Africa by protecting the millions of workers who built it.

Now that’s a beautiful thing!

N° SOLD

SAFETY BO O T

*Since 1990 no other safety footwear style has sold more pairs in SA, as we near 10 million pairs sold.

LEMAITRE SAFETY FOOTWEAR

FROM ONE WORKER TO ANOTHER

View the full Maxeco story at:

www.lemaitre.co.za

ALTERNATIVE ENERGY

BDO SA refines natural resources service offering BDO South Africa has demonstrated its capabilities with an impressive service offering in the natural resources sector.

T

he company has enhanced its services in the natural resources sector through working with some of the largest mining companies in South Africa. In addition, BDO also has experience in servicing mine engineering companies and junior miners both locally and internationally.

Servaas Kranhold, head: Natural Resources at BDO, says that the company’s natural resources sector is very strong, with an impressive global footprint in Australia, Canada, the UK and USA. Some of the services offered by BDO in the natural resources sector include: • HR consulting • valuations of mines • data analytics • forensics • internal audits • IT audits • sustainability reporting • risk management • consultations regarding taxes (including income tax, VAT, royalty and carbon taxes) • external audits.

Renewables are a significant part of BDO’s natural resources business

34

Renewable energy For more than 30 years, BDO has worked with thousands of clients in the exploration, production

THE RESOURCEFUL MINING ISSUE | 2021

ALTERNATIVE ENERGY

and service space to provide customised solutions through resources in every major natural resources business centre in the world. Proficient teams have assisted clients with matters that include: • managing projects in multiple countries with varied regulatory and political risks • financing and tax planning • infrastructure to support projects in isolated regions and offshore • market price volatility and instability impacting demand in all industries • evolving and complex regulatory environments, ranging from environmental regulations to changing accounting standards • an increasingly complex network of suppliers with new relationships to manage • difficulty finding good talent and experience in management and in the field.

Renewables are a significant part of BDO’s natural resources business. Kranhold explains that the growth of renewables has led to it becoming a major talking point and has attracted much attention. A lot of major mining houses have made renewable energy a priority for their operations. Most mining houses are looking to produce their own electricity through renewable energy due to power supply challenges faced in South Africa.

Kranhold acknowledges that it is important for South Africa to consider significantly expanding its renewable energy projects to reduce the country’s reliance on coal for power generation, and to also meet current and future electricity demands. He does, however, note that the transition from coal to renewable energy will not be immediate. “We won’t exit coal in the next five years. I think that’s a longterm process. From a South African perspective, I don’t think we’ve got sufficient renewable projects.”

In South Africa, BDO has developed and reviewed financial models for both renewable energy and fossil fuels. The company has experience in developing financial models, reviewing inputs, and preparing proposal documents.

BDO has also been involved in various projects that include: • the bid preparation for two solar plants, one of which is currently in operation • performing outsourced accounting services, including back office administration, public officer and bookkeeping services to several energy companies • auditing several energy sector clients across the country • setting up corporate structures for companies expanding into South Africa and Africa (through the Africa Desk).

35

ALTERNATIVE ENERGY

IPPs and going off the grid Renewable energy is going to play a crucial role when it comes to independent power producers (IPPs). Most mines are looking to become IPPs and this will have many advantages for the mining industry.

In addition to being beneficial for the operations themselves, mines that are IPPs also have the potential to further enhance their relationship with the host communities in which they operate. Kranhold believes that it is important for discussions to take place between governments and mining entities to identify how electricity produced by IPPs can be channelled into the surrounding communities. In addition, it is equally important to consider how the relationship dynamics between mines and communities will be impacted once mines become IPPs. According to Kranhold, mines can significantly save on electricity costs by going off the national grid. He does, however, highlight that going completely off-grid is not yet possible for mines in South Africa. “If you look at the advances over the last year or two, there are a lot of new technologies that will help companies to move totally off-grid.”

Using large solar plants as an example, Kranhold explains that the current cost of building and implementing a plant able to meet the electricity demands of a mine outweighs the potential benefit that could be achieved. “With the technology improving on an almost monthly basis, I believe that all mines in the future could be close to 100% off the grid.”

He adds that it will be easier for surface mines to adapt quickly to going off-grid as compared to underground mines.

Kranhold does not rule out underground mines from generating all their own power, but cautions on the challenges involved to ensure sufficient electricity from a shaft perspective. For South Africa’s gold mining industry, complete off-grid electricity will be especially challenging due to the depth of gold mining operations that are 2 km to 4 km deep.

Servaas Kranhold is BDO’s head of Natural Resources

36

African footprint and service offering In South Africa, BDO has offices in all major cities – Durban, Cape Town, Johannesburg and

Pretoria. The company also has a presence in most African countries with significant mining activities, such as Botswana, Namibia, Tanzania and most Francophone countries. “Globally, we are in 167 countries,” Kranhold adds.

BDO also operates the African Desk in South Africa and into Africa, where it assists companies with an interest to invest or do business in Africa. “We support them and place them in contact with the right people in the country to assist them with an audit or advisory types of assignments,” explains Kranhold.

BDO’s Africa Desk specialises in helping clients minimise risk and maximise potential when it comes to doing business on the continent. Through BDO’s global network of member firms and alliance partners that extends to every African country, the company has the resources to assist with the most important aspects of establishing a company in another country – from registering with the relevant authorities to obtaining visas for staff.

The natural resources industry is facing significant pressure as it operates at the centre of an international political debate over industry tax incentives, junior miners, awarding mineral rights, offshore drilling legislation, and alternative energy. BDO’s partner-led service teams consist of professionals with a variety of multidisciplinary backgrounds and expertise that enable them to serve clients and assist them in navigating challenging landscapes in the natural resources sector.

Contact details For more information, contact BDO South Africa: Telephone: +27 (0)11 488 1700 Website: www.bdo.co.za Social media platforms Facebook: @BDOAfrica Twitter: @BDO_SA LinkedIn: BDO South Africa

THE RESOURCEFUL MINING ISSUE | 2021

CASE STUDY

OFF-GRID MINING HYBRID POWER SYSTEM Consistent power supply for a mine is critical for successful operations.

Costly electricity and power outages have driven mining companies to explore alternative energy sources that would be able to meet the needs of the mine.

A

SX-listed Resolute Mining is an example of a mining house that was on the market for alternative energy to supply consistent and affordable power to its Syama Underground Mine in Mali. As part of its commitment to delivering a life-of-mine in sustaining the cost of US$746/oz (R10 413/oz) at Syama, the company needed to define a lower-cost power solution relative to its existing source of power.

Identifying the problem The Syama Gold Mine is currently powered by singular diesel generators that were no longer the most efficient compared to the newer technology now available. At the mercy of diesel, a notoriously fluctuating, high-cost fuel, it has become an expensive solution. Furthermore, the generators had to run constantly to provide the system with the stability the mine needed.

After investigating the possibility of a grid connection, which was rejected based on time and cost, Resolute launched a tender with the target of achieving a 40% reduction in electricity costs.

As the gold producer focused on securing a more environmentally friendly solution, the environmental impact of the power solution being offered was a key consideration.

Resolute also wanted a solution that offered lowcost power without needing to make a significant upfront capital investment, so that the company could conserve capital for deployment for growth.

Finding a solution Aggreko was awarded a 16-year contract to build, operate and maintain a hybrid power plant (thermal, solar and battery). Aggreko had already been providing and operating a 28 MW diesel power plant on the site, augmenting the existing diesel power station for a few years.

37

CASE STUDY A vast project needed a vast solution and Aggreko relished the opportunity to work with Resolute to deliver a bespoke, cutting-edge technical and commercial solution as part of a 16-year power supply agreement.

Technical offering Delivered in two stages, the project considers various factors with a meticulous level of detail to ensure smooth delivery and zero disruption to the mine’s production activity.

Stage one was completed in 2020 and comprises three 10 MW thermal Wärtsilä modular blocks and a 10 MW battery storage system, which will provide spinning reserve displacement and outbalance sudden jumps in load.

The second stage will consist of the installation of an additional 10 MW Wärtsilä modular block in 2022 and the addition of 20 MW of solar PV power in 2023.

There can be some hesitancy to implement solar, as mines usually have short planning horizons and the usual lifespan of a PV park is about 20 years (if not sometimes longer than the operation of a mine itself ).

The initial site infrastructure layout will include space to accommodate a fifth 10 MW Wärtsilä modular block, enabling the mine to add additional power capacity if needed in the future to support growth or expansion plans.

Once the solar power system is installed, the 10 MW battery storage system will also manage the output of the solar power system, smoothing out fluctuations in PV generation and facilitating integration into the hybrid system.

Commercial offering Pricing was structured with a combination of fixed and variable charges depending on electricity

required, and evolving MW installed. It also includes an incentive programme where Aggreko shares between 25% to 50% of the resulting fuel savings, if improved efficiencies for key performance indicators in the contract are achieved. This provides Aggreko with an incentive to further reduce the cost of power for Resolute.

During the project engineering phase, an authentic partnership was forged with Resolute to ensure that the best site infrastructure was used, as well as to optimise the civil works and installation of the plant. For example, the solar array will be constructed on the surface of the existing Syama Tailings Storage Facility, thereby maximising positive environmental outcomes and augmenting Resolute’s rehabilitation programme.

The outcome Upon completion of the project, a $10 million (R139.8 million) cost saving in the first full year of operation was achieved. In addition, there was a reduction in the environmental impact that will result in long-term sustainability for the mine.

As a service agreement with a hybrid offering, the power supplied allows Resolute to focus on its core business of mining while delivering substantial cost savings, estimated at €2 million (R34 million) per month on their current total cost of energy – a 40% reduction from current electricity costs. These savings will flow directly into Resolute’s production cost per ounce and help it operate in any gold price environment, which is crucial for the long-term sustainability of its mining operations.

Once the solar power plant is integrated into the mine’s energy mix, Resolute will also improve the mine’s environmental impact with a reduction in carbon emissions of approximately 20%.

A 10 MW battery storage system forms part of the hybrid power plant

38

THE RESOURCEFUL MINING ISSUE | 2021

PUMPS & VALVES

THE MEASURE OF THE MINE Mining companies need reliable measuring tools to ensure their processing plants and accommodation camps have a continual supply of water.

T

he proper function of fire hydrants systems, mining processing operations, fresh water for workers, and functioning wastewater treatment plants depends on accurate and timely water measuring devices.

VEGA contributes to three main areas of mining operations: • the supply of water that comes from either a dam or a bore • the mining processing operation itself • water and wastewater systems at the accommodation camps.

Bores and dam levels For monitoring bore and water levels, VEGA recommends its standard production sensor. This device sits below the water and measures the head of pressure above the diaphragm. The pressure reading is then transmitted to the control room.

Regular automatic pressure readings are translated to a measurement of water level in real time, allowing the company to close the bore off for use immediately when levels become too low. Monitoring water levels in a dam follows a similar procedure, with the sensor placed at the bottom of the dam and readings transmitted to the data centre.

John Leadbetter, managing director, VEGA Australia, says that an automated, reliable measuring device allows for the accurate, timely and safe monitoring of water. “Bores can reach great depths the further they are situated from the ocean, with some in the Pilbara [a heavily mined region in Western Australia rich in iron ore] reaching 400 m down, making the VEGA monitoring devices invaluable tools.”

on the speed of return, which is then translated to an accurate water level reading. Measurements are taken continuously at regular intervals for real-time monitoring.

In the mining operation, pipes that feed areas such as fire hydrant and sprinkler systems or dust control sprayers are also monitored using a VEGA device.

A pressure transmitter is fitted to the pipe to ensure adequate pressure is always available, and provides confidence that when the valve goes on, the water comes out. “Measuring pressure in the piping is vital,” Leadbetter says.

He adds that having water in the pipe is not the same as having pressure in the pipe. “In a comparison with a garden hose, if you turn off the nozzle but leave on the tap, the hose will be full of pressure. However, if the tap is turned off, there will still be water in the hose, but no pressure.”

Accommodation camp Water for use in the accommodation camp requires a higher-level monitoring, which includes the quality of water, to ensure both potable water and the environmental management of wastewater.

VEGA’s measuring devices are placed in the water tanks and sewage treatment holding tanks to provide real-time monitoring to control centres.

Radar sensors such as the VEGAPULS 64 provide accurate readings under all environmental conditions

Mine processing plants In the processing operational areas, water monitoring is required for liquids in storage tanks and pipes, measuring both levels and pressure. For this purpose, VEGA applies its range of radar sensors well suited to the harsh environment of the processing areas.

The radar sensor sits at the top of the tank and sends a microwave beam towards the water.

As water is a microwave reflector, the beam is instantly returned, allowing for a reading to be taken

39

PUMPS & VALVES

CONTACTLESS ACCEPTANCE TEST PROCEDURE

Online acceptance testing requires no physical interaction between customers and engineers

L

Since the outbreak of the novel coronavirus, many companies and industries have had to find innovative ways of carrying out day-to-day tasks in a manner that involves minimal physical contact.

ocal pump manufacturer KSB Pumps and Valves has launched an innovative online acceptance test procedure that no longer requires customers and their engineering teams to be present when acceptance testing takes place.

According to Friedrich Görgens, technical manager, KSB Pumps and Valves, acceptance tests and final inspection are an essential proof of compliance when purchasing pumps and equipment to ensure the guaranteed values are met. In the past, customers always had to travel to the test facility to witness their purchased pump being tested.

Online acceptance testing is KSB’s answer to improve the ease and convenience of acceptance testing

40

Improved convenience The service was initially implemented to curb expenses that are usually incurred through travel and accommodation to test centres. The remote pump acceptance testing has also allowed for business to continue as usual during the ongoing Covid-19 pandemic.

“Online acceptance testing is KSB’s answer to improve the ease and convenience of acceptance testing. Tests are transmitted live via the internet and are encrypted to be accessible only to required users,” says Görgens. He further adds that online acceptance testing also enables the customer to see a live camera view of the pump in the test facility, as well as the characteristic curve being generated live from readings taken and displayed during testing.

“In addition to pressure and flow data, the test software records all further performance data required for a measurement to inspection/testing standard DIN EN ISO 9906, enabling the derivation and assessment of the pump’s efficiency.”

The additional measurement and recording of bearing temperature and vibration is available. Görgens explains that these are displayed live in parallel to the performance and incorporated in the final test report.

Testing centres Online acceptance testing is available at KSB Pumps and Valves South Africa’s test centre in Germiston and the facilities can accommodate pump sets with a drive rating of up to 550 kW, flow rates of up to 3 000 m³/h and discharge pressures up to 60 bar. “We provide the customer with organisational information, order data sheets and a precise description of the acceptance testing prior to the acceptance test. This includes details on the measuring instruments used, including the corresponding calibration certificates,” adds Görgens.

String tests with the customer’s original motors, transformers and frequency inverters can also be performed. “After the acceptance test, KSB displays the results for comment and then emails the customer the certificates within minutes,” concluded Friedrich.

Follow this link to watch a video of the online test in operation: https://www.youtube.com/watch?v=2tHxYJGjT_s

Acceptance tests and final inspection are an essential proof of compliance when purchasing pumps and equipment

THE RESOURCEFUL MINING ISSUE | 2021

PUMPS & VALVES

Working towards a for mining The onset of the Covid-19 pandemic, and its continued repercussions, has further highlighted the need for global digital transformation. In South Africa, it has forced the acceleration of a digital future for most organisations – and mining is no exception.

A

lthough many have already begun investing in digital technologies, others have fallen behind, according to the BCG Digital Acceleration Index (DAI). The DAI shows that the metals and mining industry is roughly 30% to 40% less digitally mature than comparable industries.

South African mines face some unique challenges, including labour uncertainty, illegal mining operations, community activism, as well as plaguing infrastructure issues relating to rail infrastructure, water supply and electricity outages. Furthermore, the high unemployment and poverty rates in the country require a delicate balance between implementing cost-effective technological solutions without compromising the human workforce.

What is clear, though, is that the adoption of digital technology in every facet of the business will ensure sustainability and afford the opportunity for future growth on a global scale.

Digital transformation with Hubgrade As a world leader in the design and provision of tailormade environmental solutions, Veolia aims to assist industries with sustainable digital transformation.

According to the DAI, only 25% of metal and mining companies make use of customised digital technologies, while the rest rely on ‘off-the-shelf’ products. Although such products do offer their own value, larger operations run the risk of huge financial losses when trying to modify such a solution to fit their business model. A customised Veolia solution such as Hubgrade – a combination of human expertise and digital innovation – means any additional capital expenditure can be averted, allowing for operational and environmental efficiency.

Hubgrade is part of the quality improvement process continuously adopted by Veolia and has been designed as a global offering integrating all customer issues relating to the management and control of resources.

These include: • regulatory compliance and accountability • coping with ageing infrastructures • making sustainability commitments visible • benefiting from transparent and secure access to data • ensuring security and continuity of service.

The operational expectations are as follows: • long-term support • controlled management of resources • sharing of industrialised information • clear and simple analysis and reporting • foolproof reactivity.

Organisations partnering with Veolia can expect step-by-step guidance that will enable them not only to adjust effectively to digital innovation but to implement the correct solution for digital advancement. Veolia has 160 years of experience and more than 350 proprietary water technologies.

This positions the company well to assist the mining industry, and other large industrial players, as a technology partner that ensures sustainable environmental solutions.

By utilising such technologies, a mine can change its wastewater status to a reuse status and a zero-effluentdischarge operation. With a large operational footprint on the continent, in all facets of mining activities, Veolia is constantly growing this portfolio of solutions as regulations become more challenging for the industry, thereby driving value through technology for its stakeholders.

41

PGMs DEMAND & SUPPLY

World Platinum Investment Council

PLATINUM DEMAND DRIVERS

Platinum is one of the rarest metals in the world, with its unique physical and catalytic properties making it highly valued across a number of diverse demand segments.

According to the World Platinum Investment Council, there are four core segments of platinum demand, namely: automotive, industrial, jewellery and investment.

AUTOMOTIVE Platinum demand from auto catalysts has equated to between

31 – 43% of total demand in the last 5 years

Platinum is central to reducing vehicle emissions both now and in the long term

Platinum’s superior catalytic and conductive properties in fuel cells turn hydrogen and air into water producing electricity to power electric cars with zero emissions 3 minute refuelling and c. 600 km range

Euro 6d (RDE) and China 6 compliant catalysts use more platinum per car to achieve the lower emissions requirements

Platinum in spark plugs and O2 sensors supports more efficient engines Platinum supports diesel cars, which are on average 20% more CO2 efficient than an average petrol car

Platinum use in petrol (substitution for palladium) is a material demand growth driver

INDUSTRIAL Platinum’s diverse other industrial uses account for between

22 – 27% of total demand in the last 5 years

42

ELECTRIC MOTOR

Fuel cell electric vehicles (FCEV) use more than twice the amount of platinum in internal combustion engine vehicles. Early adopters with commercially available cars include Toyota, Hyundai and Honda

20%

MORE EFFICIENT

FUEL CELL

Platinum catalysts increase yields in chemical processes, an example being more high octane fuel per barrel of oil

THE RESOURCEFUL MINING ISSUE | 2021

INVESTMENT

Physical platinum exchange traded funds (ETFs) have become firmly established in several regions. Investors added circa 1.5 million ounces in ETFs over 2019 and 2020

Investment is the most variable factor over the past five years, ranging between

0 – 20% of total demand (net investment, excluding increases or decreases in above-ground stocks)

Examples of investment products in different geographies

Created in late 2014, the World Platinum Investment Council (WPIC) exists to stimulate investment demand for platinum

JEWELLERY Global annual jewellery demand has been between

Private individuals in Japan have been able to invest in platinum accumulation plans since the 1980s

High-net worth and institutional investment in vaulted bars

North American individuals investing platinum bullion coins and bars into their retirement savings plans

Chinese citizens can access a growing range of platinum bullion products

Platinum jewellery has achieved global premier status and strong association with love. Market developed by Platinum Guild International since 1975

24 – 32% of total platinum demand over the last 5 years

China is the world’s largest market for platinum jewellery

Platinum is necessary for vessels that hold and form molten glass for liquid crystal displays, optical and ophthalmic, glass fibre and other applications

In the US, platinum is a preferred choice for engagement rings, while in Japan it is the favoured choice for generations of brides and grooms

India is a driver of growth including a rising men’s jewellery market

Platinum increases storage density on hard discs for laptops and servers supporting cloud storage.

Platinum also supports numerous electronic applications

Platinum is biocompatible and remains in the body connecting pacemakers and makes instruments visible during keyhole surgery. Platinum-based therapies have been at the forefront of cancer treatment for more than 40 years

Platinum improves chemical process efficiency and increases media storage capacity globally

43

7TH ANNUAL EDITION

1 - 2 JUNE 2021 www.juniorindaba.com

FOR EXPLORERS, DEVELOPERS & INVESTORS IN JUNIOR MINING Resources 4 Africa is pleased to announce the 7th edition of the annual Junior Indaba, taking place on 1 & 2 June 2021. Known for its incisive, informative and frank discussions, the Junior Indaba focuses on the exploration and junior mining sectors in South Africa and elsewhere in Africa. Panel discussions will focus on topics such as: access to finance; the regulatory environment; outlook for commodities; demand for metals; the global energy transition; the hydrogen economy and much more.

Discussions will include: • What the global outlook for junior mining and exploration post Covid-19?

• What can be done to make South Africa a more attractive destination for junior miners?

• What lessons can be learned from junior miners who are already operating?

• How can juniors take advantage of the shift towards 4IR, digital transformation and modernization in mining?

• What are investors’ perspectives on the junior mining sector?

• What does the shift towards a hydrogen economy mean for junior mining?

• What does the global energy transition mean for African junior coal miners?

• And much more…

Popular features over the two days include: Lessons from the Legends; Myth Busters and a showcase of presentations from junior miners across the continent. Other speakers include investors, government, analysts and industry experts .

Mining Industry Partners:

Sponsors:

Contact us about sponsorship opportunities sponsorship@resources4africa.com

For more information please contact, Carina Willemse: Tel: +27 (0) 61 421 9492 Email: carina@resources4africa.com or Stuart Alderson-Smith: Tel: +27 (0) 83 685 8777 Email: stuart@resources4africa.com

THE RESOURCEFUL MINING ISSUE | 2021

PGMs DEMAND & SUPPLY

We need more palladium Ivanplats, one of the world’s strongest contenders for market dominance in the future of platinum group metals has a motto: ‘we need more palladium’.

By Olebogeng Sentsho*

T

hese words were famously uttered by Iron Man from Marvel’s The Avengers film franchise, whose power is derived from a palladium-powered device that sits in a cavity in his chest. This assertion is apt, given that the world is currently running at a million ounce deficit for the platinum substitute.

According to Trevor Raymond of the World Platinum Investment Council (WPIC), there will be an estimated 1.5 million ounces of substitution of platinum by palladium by 2025. These metrics inform us that the demand for platinum is growing and is only getting stronger, thereby increasing the need for metals that can substitute it.

As demand strengthens and the metal price follows a parallel trajectory, an accurate market overview is necessary for us to understand the ramifications of this increase in demand and the consequences of constrained supply. Substitution is a major factor in demand studies and it is important to understand the economics of the metal being substituted and its substitute. As the largest supplier of PGMs to the global market, the macroeconomic factors in the South African mining industry influence productivity and have a huge impact on the demand and price of platinum.

Global platinum supply The global supply of platinum and PGMs depends largely on South Africa’s ability to produce the

metals. South Africa supplies some 73%, 37% and 82% of global platinum, palladium and rhodium, respectively. The increasing risk of a decline in supply from South Africa is exacerbated by the combined effects of electricity shortages, prolonged industrial action, increased costs, and a significant reduction in capital expenditure worsened by a negative legal and political environment.

As a result of South Africa’s power challenges, the continuity of South African production is uncertain.

Power utility Eskom has estimated that it will take anything from 18 months to five years to address the issue. This will have a driving effect on global demand, as supply will be constrained by South Africa’s transient power supply.

Increase in the demand for platinum The exponential growth in demand for platinum and its substitute has been driven by several key factors. The drive to reduce emissions and the carbon footprint of fossil fuels has catapulted the world into decisive action and stricter regulations regarding vehicle emissions.

In China, regulation 6/VI (which forces diesel particulate filters on all new diesel heavy-duty vehicles introduced to the market after July 2021) is a huge driver for the demand for palladium. In the PGM family, palladium is the most CO2 efficient drive train and, therefore, demand for the substitute

45

PGMs DEMAND & SUPPLY

The global supply of platinum and PGMs depends largely on South Africa’s ability to produce the metals

46

will remain quite high. In 2019, as a result of China 6/VI, petrol vehicles drove the massive increase in palladium demand.

The incredible demand for palladium and rhodium is resulting in platinum substitution and exponentially accelerating the trajectory of the growth of the palladium and rhodium market. Globally, vehicle manufacturers have had to increase the content (loading and loading ratios) of platinum, palladium and rhodium in autocatalysts to meet the stricter limits. Fossil fuel internal combustion engines (ICE) will be phased out faster and will be replaced by electric vehicles and FCEVs, along with a combination of hybrid vehicles. Hybrid diesel requires an increase in autocatalyst platinum loading.

Proton exchange membrane (PEM) fuel cells remain inextricably linked to platinum because of their size.

Raymond explains that “the size of the fuel cell is large, and the electrical current density is high and it’s only platinum that can provide that kind of performance in a small enough unit to be on a vehicle. Second, what Covid-19 has done is that it has really focused the world on climate change and perhaps with less funding, because of the huge financial cost of the pandemic. So, what you’ve got is that hydrogen – if it’s generated sustainably – is a replacement of fossil fuels, and that’s the big focus and a much higher certainty that the hydrogen economy will evolve.” The significant reduction of the platinum content in fuel cells will enable platinum demand to accelerate, propelled by economic factors such as price and economies of scale related to production.

Driving platinum growth The key driver in the growth of platinum demand will be reducing the price of hydrogen. If the price of hydrogen (or the cost of generating it) is reduced, more fuel cell vehicles will become affordable and it is this demand that is material for the growth of platinum demand. Various stress tests on the market penetration of PEM puts the demand of platinum at an increased level of 400 000 to 600 000 ounces of platinum per annum for electrolysers. Cheaper hydrogen means more fuel cell vehicles; it is estimated that fuel cell passenger vehicles will become available for sale in 10 years. This outlook compels platinum miners to rethink their strategies and prepare for the cyclical effects that will be propagated by the technology that makes hydrogen cheaper.

The constriction in supply and increasing demand will ultimately support the drive for substitution.

With new technologies emerging worldwide,

green hydrogen and the fuel cells that produce it will be easier and cheaper to manufacture, thereby making the products powered by these technologies affordable and ubiquitous. The demand for platinum will continue to increase because of the capacity and possibility it offers for power generation and green hydrogen.

The drive for carbon neutrality will continue to positively affect the demand for platinum and its substitutes. What remains is South Africa’s ability to address its internal challenges and take advantage of the bounty of economic development and growth potential afforded by the beneficiation of the world’s most precious metals. *Olebogeng Sentsho is a mineral economist and the CEO of Ayana Group.

Olebogeng believes that the macroeconomic factors in the South African mining industry influence productivity and have a huge impact on the demand and price of platinum (Credit: Poppy Photography)

THE RESOURCEFUL MINING ISSUE | 2021

PGMs DEMAND & SUPPLY

Renewable energy driving the demand for PGMs

For centuries, the silvery-white lustre of platinum has contributed to its appeal in jewellery manufacturing. It is also used extensively in medical applications, but the market that has been the main driver for demand has been the automotive industry. By Prashaen Reddy*

T

he automotive industry mainly uses platinum in catalytic converters, removing some of the harmful emissions that cars produce. It is also used for the production of electronic products, as a catalyst in the chemicals industry and in the production of fuel cells.

However, over the last five years, there has been a decline in the demand for platinum group metals (PGMs), as the world started shifting to renewables and a circular economy. This challenge has presented the need to look for other uses for this metal. With renewable energy and digital advancements driving the transition, manufacturers have started utilising recycled platinum.

Renewable energy The world is shifting and change is coming quickly for the traditional internal combustion engine, with many automobile manufacturers now producing electric vehicles and exploring the potential of hydrogenpowered vehicles.

With the decline in mobility driven by traditional internal combustion engines, the need for catalytic converters will decline. Therefore, one of the big areas being explored by PGM mining companies is the support of the rise of the renewable energy battery storage and fuel cell industry.

The metal is being utilised and experimented with to help support the storage of energy in battery technology and supporting newer industries. The use of platinum within storage and pollution management technology in the automotive sector is driving big mining companies, who have had large portfolios in platinum production, into the renewable energy market to see how they can monetise platinum in different ways.

Digitalisation Another space we need to understand is how much of a role PGMs have played in digitalisation and the technology boom, and how much of these metals have been utilised in the electronics world.

One of the biggest changes globally over the last 20 to 30 years has, of course, been the rise in demand for digital components. We have seen this in the evolution of everything from cars and washing machines to smartphones. With the Fourth Industrial Revolution, this is not slowing down, as we are digitising everything. From a communications perspective, and through 5G, we are connecting faster and to everything around us.

With 5G driving increased connectivity, we will need to start including microchips and Wi-Fi chips into everyday devices. 5G is already playing a big role in the

47

PGMs DEMAND & SUPPLY

We need to look at how we can cut down on the exporting of all our platinum to other countries

48

THE RESOURCEFUL MINING ISSUE | 2021

PGMs DEMAND & SUPPLY automotive sector – just look at autonomous driving and the increased ability to connect and remotely monitor and manage devices.

Another increase in demand for PGMs was seen due to the disruption Covid-19 had on the supply chain.

This saw most global manufacturers close shop as the world went into lockdown.

This resulted in the shortage of microchips. At the same time, we saw an increase in demand for these products due to people now working from home and the general increase in mobile and connected devices. All of this is helping to increase the demand for some of these metals.

Sustainability of the industry and investment While a mineral such as coal has an uncertain future, this is not exactly the case for the PGMs sector; the benefits of this greater certainty have already started to have a positive impact.

We need to remember that the transition to cleaner energy is not immediate. It is a long-term play with a lot of opportunity, if we can get the uses of PGMs in these key growth markets right. If you look at any forecast on investments in renewable technologies and energies, you will see high demand forecasts for semi-conductor chips or processors.

Government has always pushed its broader manufacturing agenda and the beneficiation of commodities mined in South Africa, but the challenge is having the right policies and the enablers in place to allow for local manufacturing.

A great example of this is our local motor industry, which sources a lot of its components locally due to government regulations that have pushed them down that road of promoting local manufacturers.

If we want to be serious about the government’s agenda on industrialisation and industrial policy, we will have to start to drive local manufacturing in the above two industries.

For example, we need to localise manufacturing within the renewable energy space to support local growth in renewables and regional growth. There is a lot of funding for renewables, which means that there are many investment opportunities.

The same goes for digital; we need to be thinking about how we localise and produce some of these components. This sector is far more complex and a more intricate industry; it is also very competitive, with the likes of Vietnam, Indonesia, Thailand and China all producing these digital components at a fraction of the cost. If we want to localise this industry, we need to think about our capabilities and utilise the demand that is there.

The African continent is the least digitised of all the regions in the world and, therefore, will have the

strongest growth in the use of digital technology.

With this knowledge, and as we industrialise, we need to leverage the increased numbers of consumers and our low-cost environment.

Some 80% of the world’s platinum comes from South Africa. We need to look at how we can cut down on exporting all our platinum to other countries. They produce the final products – like batteries, microchips, fuel cells, chemicals, etc. – only to sell them back to us at a higher cost. It’s about how we can utilise, create and become a supplier to global markets at a competitive rate.

Mining companies have also been pushing this agenda for the sustainability of their own industry and need to find other applications for PGMs. At the end of the day, it is really about the sustainability of an industry that will slowly die if it does not reinvent itself and the applications need to keep up with where the world is going. *Prashaen Reddy is a partner with the global management consultancy Kearney, based in their Johannesburg office.

Prashaen Reddy is passionate about the energy sector in South Africa (Credit: Kearney)

49

PGMs DEMAND & SUPPLY

PGMs PERFORMANCE DURING A GLOBAL PANDEMIC The supply and demand for PGMs are both forecast to rise in 2021 compared to 2020. This was always likely as both have already improved significantly since the first half of 2020, mainly owing to the world learning to live with Covid-19. By David Jollie*

50

THE RESOURCEFUL MINING ISSUE | 2021

PGMs DEMAND & SUPPLY

S David Jollie has an in-depth knowledge of PGMs and has authored various reports on the platinum and palladium markets

South Africa is among the world’s leading platinum producers (Credit: Anglo American)

outh Africa produces approximately 54% of primary global PGMs supply. If you consider total supply, including recycling, this number is about 40%. Many South African producers, including Anglo American, also invest significantly in market development efforts, and have done so over many decades, to stimulate demand for PGMs. About 65% of demand for PGMs is from the automotive industry and is used to reduce emissions from internal combustion engines. Other key demand segments include jewellery, investment products, and a wide range of industrial applications.

Industrial uses for PGMs include their use as a catalyst both for green hydrogen production through PEM (polymer electrolyte membrane) electrolysis and in PEM fuel cell applications, including fuel cell electric vehicles.

Covid-19 impact on PGM sector In 2020, all three major PGMs saw a market deficit (demand exceeding supply). Compared to 2019, however, 2020’s supply and demand for each metal were considerably lower – a consequence of the Covid-19 pandemic and unprecedented government responses worldwide, including widespread restrictions on socialising and mobility, while the temporary closure of the Anglo Converter Plant also affected supplies of metal.

The negative demand impact began in the first quarter of 2020, as China confronted the pandemic, but was most pronounced in the second quarter, when governments imposed severe lockdowns in most key consuming countries, shutting auto factories, car dealers and jewellery stores. By then, the pandemic was also affecting PGMs supply, especially for platinum and rhodium, as the South African lockdown (27 March to 1 May 2020) initially saw all non-surface and nonmechanised mines close.

PGMs demand began to recover late in the second quarter of 2020 and continued to do so through the second half. Global auto sales, led by China, were almost back to normal by July 2020, with auto production, where recovery was slightly slower, following soon after, and bringing with it higher automotive PGMs demand. This recovery was aided by an increase in loadings to meet emissions legislation, as well as a growing preference for personal transportation over public transportation seen in many countries. The broader industrial economy also bounced back strongly as the virus receded and working practices were overhauled, underpinning PGMs industrial offtake.

The recovery in platinum jewellery demand was slower in starting, as retail and other service sectors remained subdued, though it also gradually improved,

51

PGMs DEMAND & SUPPLY with some signs that spending that would otherwise have gone to travel was going towards this sector.

PGMs supply also recovered from mid-2020 onwards.

South African underground mines reopened and, while social distancing kept output slightly lower than normal, near-normal production soon resumed. Russian PGMs mine output, more important in the case of palladium, continued to show little impact from the pandemic.

Current demand and supply factors The roll-out of effective vaccines now suggests a further upside, though how soon they bring the promise of ‘normality’ will vary by country and sector.

And, in some cases, ‘normality’ will be different than it was before the pandemic.

Supply is likely to increase more substantially for platinum and rhodium than palladium in 2021. In 2020, platinum and rhodium mine output were hit much harder than palladium by the pandemic, in light of the former two metals’ greater exposure to deep-level mining in South Africa. Furthermore, the flooding at Norilsk Nickel’s mines in Russia has disproportionately affected palladium production in the first half of 2021 relative to platinum and palladium.

Covid-19 protocols are in place at South African operations, and production is unlikely to be affected, except in the event of government intervention or subsequent breakouts of the pandemic. The initial release of Anglo American Platinum’s work-in-progress inventories, taking supply above normal levels, will also proportionally increase supply more in respect of platinum and rhodium. Recycled supply will also increase – again, more for palladium and rhodium than platinum, partly due to their elevated prices, but also

because of historical trends in loadings on cars now being scrapped.

All three major PGMs (platinum, palladium and rhodium) should also see solid demand growth.

According to forecaster LMC Automotive, they will benefit from light vehicle production rising year-onyear in 2021, although the shortage of semiconductors will likely pose a headwind to production in the near term. Light-vehicle PGM loadings should be steady at their current high level after the last few years’ strong increases. Heavy-duty production is forecast to decline by 1%, but will increase significantly in Europe and the USA, where most PGMs demand arises. Heavy-duty vehicle PGMs loadings will increase, thanks to stricter Chinese emissions standards. Platinum should also be helped by higher gross jewellery and industrial demand, with more potential for a bounce in the former sector than the latter.

Looking ahead The long-term fundamentals for the metals we mine remain robust, driven by stricter vehicle emissions standards in crucial markets like Europe and China, requiring higher loading of our metals, healthy industrial demand and the potential offered by the hydrogen economy.

We believe that the robust demand outlook for PGMs, combined with Anglo American Platinum’s focus on investing in fast-payback, value-accretive projects, while implementing world-best operating practices, will continue to drive strong earnings. *David Jollie is the head of Sales and Market Insights: PGMs at Anglo American.

The North Concentrator at Anglo American’s Mogalakwena platinum mine in Limpopo, South Africa (Credit: Anglo American)

52

Accurate down to the smallest grain.

Radar for reliable levels in bulk solids applications From simple to challenging: With radar technology that is highly robust, flexible and economical all at the same time, VEGA is putting things on track to ensure more reliable and efficient production processes involving bulk solids.

Due to our decades of experience we understand the requirements of the industry quite well. That’s why VEGAPULS level sensors are able to deliver exact measured values even when conditions get extreme

Need one more here

because of dust, noise or buildup. And why they are also ideal for simple applications where efficiency, and economy in particular, are required.

www.vega.com

Strap goes here Strap goes here