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Mining Weekly Editor Martin Creamer discusses South Africa’s titanium beneficiation project which is expected to peak at R14-billion and headlines from this year's London Indaba.

The main founders of the Inflation Reduction Act envision the US legislation as a clean energy bill to lower the costs of green energy technologies for everyone around the world as well as being emulated by especially those countries that have benefitted from emitting carbon into the air since the start of the Industrial Revolution.

Such countries could introduce their own versions of the Inflation Reduction Act to drive down prices even further for global benefit, US Department of State Bureau of Energy Resources Office of Energy Transformation acting director Scott Woodard told this week’s London Indaba.

“If you looked at estimates of what electrolysers to generate clean hydrogen were going to cost and how long it was going to take, it was a decade away and they were going to be expensive for a while.

“Now, estimates say that we could be seeing 10 GW electrolysers in the next two three years and clean hydrogen could be virtually zero cost,” Woodard said in response to London Indaba chairperson Bernard Swanepoel during question time.

Proton exchange membrane (PEM) electrolysers, which are regarded as being highly effective producers of zero-emission green hydrogen, are efficiently catalysed with the help of South Africa’s platinum group metals (PGMs), especially iridium. Electrolyser production is being brought down the cost curve significantly as China, with its robotics and automation, enters the era of machines making machines.

EVERY KILOGRAM OF GREEN HYDROGEN SUBSIDISED

The Inflation Reduction Act subsidises every kilogram of green hydrogen that is generated.

“That’s what I think we want people to really focus on when they look at the impact of this. Clearly, there are some trade issues that have popped up, but we have found as we’ve engaged with our partners, we have been able to shift the conversation somewhat from when the legislation first came out,” said Woodard.

“And hydrogen’s a good example because the green hydrogen value chain is not yet completely owned by a single country,” answered Swanepoel.

“The first thing to realise is that the Inflation Reduction Act is a huge piece of legislation, absolutely massive.

“You’ll see the headline number of $370-bilion but I’ve seen some private sector banks estimate that spending on this is actually going to be north of $1-trillion. Then you start thinking about how that will attract private sector investment and be even bigger,” the US diplomat predicted.

At the previous week’s FT Hydrogen Conference, Fortescue Future Industries and Fortescue Metals Group executive chairperson and founder Dr Andrew Forrest ascribed the success of Inflation Reduction Act to its absence of complexity: “It’s working because it’s simple. If you want to serve up something complex to a banker, you’re not going to get any money,” said Forrest, who expressed the view that the economies of countries could be significantly boosted for decades to come by adopting the US legislation as a model.

Meanwhile, important new technologies are being perfected that could give green hydrogen a globally traded commodity. An example of this is the work being done by German company Hydrogenious on liquid organic hydrogen carrier (LOHC) technology. LOHC technology enables hydrogen to be chemically bound to a thermal oil for storage and bulk shipping, leveraging the existing infrastructure for liquid fuels. That means that green hydrogen could in future be transported, stored and delivered in existing oil and gas infrastructure, and be traded globally in the same way as oil and gas.

PRESSURE BEING TAKEN OFF IRIDIUM SCARCITY

When it comes to PEM electrolysers, pressure is being taken off their need for scarce iridium. German PGM products and services company Heraeus Precious Metals, for example, is having major success in the thrifting of iridium and is also investing €35-million in the expansion of its PGM recycling capacity at Hanau in Germany, with the build-out forming part of a €300-million global recycling pr...

The private sector is so far working with government on six of the ten energy crisis work streams, for which business raised R100-million to procure skills and expertise for donation on an arm's length basis to the Presidency, within which the National Energy Crisis Committee (Necom) is housed.

Business for South Africa (B4SA) chairperson Martin Kingston expressed the view that it is technically possible to put an end to loadshedding by the end of 2024, which is the objective of the joint energy effort. The two other challenges being tackled are transportation and logistics, and crime and corruption.

B4SA is an alliance of South African business leaders working with the South African government and other social partners to help deliver sustainable solutions for South Africa.

“We're not going to assume the role and responsibility of the State. It would be wholly inappropriate, but we can certainly partner with them, bring our skills, expertise, and indeed commitment to bear,” said Kingston, who spoke to Engineering News & Mining Weekly in a Zoom interview on Thursday. (Also watch attached Creamer Media video.)

In the case of South Africa’s transportation and logistics challenges, areas of focus are being jointly defined, along with the appropriate resourcing of those work streams: “I think it'll take a little bit longer, but yes, we're certainly beginning to see progress emerge and traction being gained,” said Kingston, who emphasised the need to ensure sharp focus on a limited number of interventions that can move the needle as quickly as possible, “and that's what I believe we're going to start seeing in the next few weeks”.

A joint strategic oversight committee, which mirrors what was successfully implemented during the Covid pandemic and which is now also expected to deal successfully with the three energy, transport and logistics, and crime and corruption challenges, is committed to meeting fortnightly, ahead of reporting to the President every six weeks.

“Each and every one of the workstreams in the underlying areas of focus are up and running or being mobilised, so there are indeed early signs of real progress and green shoots, but it'll take several months to see real progress start to emerge.

“We're very mindful of the need to be at arm's length so that we don't, in any shape, size or form, undermine the integrity and the independence of the State in providing the support that's required," Kingston emphasised.

Engineering News & Mining Weekly: How willing is government to partner effectively with organised business in dealing with South Africa’s infrastructure and law and order challenges?

Kingston: The South African authorities recognise that we need effectively all hands to the pump to deal with very fundamental challenges, which act as a brake on real inclusive growth and that growth leads to employment and deals with many of the challenges that we've got in the country at the moment. We had a very successful experience of partnering with the government during the Covid pandemic in 2020, and the vaccination rollout in 2021, and we've used that as the basis for partnership with them in the three areas that we're focusing on. Of course, there are different pockets of government that are more supportive than others, but from the President down, there is a wide acknowledgement that we need to put all of our collective shoulders to the wheel and see how we can bring the best resources to bear from all social partners, I have to say, not just from business and indeed from the public sector, to try and address these very fundamental constraints in the system.

Have these public-private initiatives been set up in a way that positive results are seen as being highly likely?

I’d love to think that highly likely is an immediate outcome but I think we need to manage our expectations in this particular respect. The most important thing from our perspective was to (a) make sure that we have an integrated approach from business....

Mineral Resources and Energy Minister Gwede Mantashe reports that government is in the process of developing a critical minerals strategy for South Africa, which will seek to support green-economy value chains domestically and abroad.

Speaking at the Northern Cape Mining and Energy Investment Conference, Mantashe reported that government was monitoring global developments around critical minerals, which he termed a “new theatre of global economic struggle” to ensure that the strategy supported South Africa’s industrialisation aspirations.

“It is no secret that our country is well endowed with these critical minerals and can use them not only for beneficiation but also to position our country to be a strategic partner,” Mantashe said.

Several other large commodity producing countries, including Australia and Canada, have already developed elaborate critical minerals strategies as the pressure to decarbonise increases globally.

Likewise, key consuming countries are mapping out how they intend to ensure security of supply of those metals and minerals ­– from antimony to zinc, and with everything from lithium, copper and platinum in between – that will be required for the transition of electricity systems to renewables, as well as to support a shift to battery electric and fuel-cell electric mobility.

“To ensure that South Africa reaps maximum benefit from these critical commodities, we are currently developing a critical minerals strategy for the country which will enable us to support the development of domestic and global value chains for the green economy,” Mantashe said.

He added that the exploration fund being established in partnership with the Industrial Development Corporation would prioritise critical minerals projects “as these will support our green economy trajectory and support our just energy transition”.

Mantashe also used the platform to highlight the fact that the Northern Cape held significant reserves of several critical minerals, including zinc, copper, manganese and some rare earth elements.

“There can be no ambiguity in saying, the full potential of the Northern Cape mineral wealth remains largely untapped.

“We therefore call on investors to look to this province for investments into more exploration projects,” Mantashe said, while again promising that a new cadastral system, which is seen as key to revitalising exploration, would be procured soon.

“It is expected that the adjudication process will be finalised in the near future and therefore take us a step closer to the finalisation of this [procurement] process.”

South Africa’s ilmenite will receive a major value addition when it is produced in South Africa, as is planned.

This because heavy minerals sand production sells at around $300/t on export markets.

Planned now is to add value to some of that ilmenite by elevating it into titanium dioxide pigment at the Richard Bay Industrial Development Zone in KwaZulu-Natal, to enable the locally mined mineral to fetch ten times more on export markets.

The first thing the R14-billion Nyanza Light Metals project is trying to achieve is to move Africa’s abundant raw materials up the value curve, Nyanza CEO Donovan Chimhandamba emphasised to Engineering News & Mining Weekly in a Zoom interview. (Also watch attached Creamer Media video.)

Nyanza is putting together a project for 80 000 t/y of titanium dioxide pigment, which is probably around half of Africa's capacity and just over 1% in terms of the global market.

The project highlights the huge opportunity as Africa and South Africa to move up the value curve and start establishing advanced material production companies that make competitive use of locally mined materials.

Nyanza will be sourcing its ilmenite from within South Africa and the region and manufacturing costs could be lowered if a way could be found to blend in the 45-million tons of stockpiled ilmenite-containing slag at Evraz, the former Highveld Steel and Vanadium, in eMalahleni, Mpumalanga, with higher content ilmenite or synthetic rutile from Richards Bay Minerals.

Self-generation of 12 MW of solar power supported by battery storage is planned, augmented by cogenerated electricity from the titanium dioxide pigment plant itself once it is in operation.

Already commissioned is a R200-milion product testing and development centre, which is able to provide 700 t/y of titanium dioxide pigment sample to offtake partners. Offtake agreements for more than 60% of the 80 000 t/y capacity have already been signed. While the main plant is being built, the testing and development will be used to train the 850 employees that will be brought in early for upskilling.

Africa Finance Corporation of Nigeria and African Export-Import Bank of Egypt are co-funders of the project’s feasibility phase, and a third multilateral international finance institution is going through concluding the agreements. Senior debt is already oversubscribed, equity players have expressed interest, financial close is likely by year-end of this year to end and construction is expected to begin next year.

Currently, Arkein Industrial Holdings is the founding shareholder with 70% of Nyanza and DBF Capital has 30%. At financial close, arrangements with multilateral banks for the conversion of investments into equity or debt, with the project run by a project development steering committee.

Engineering News & Mining Weekly: What are benefits to the South African economy of the local manufacture in Richards Bay of titanium dioxide pigment by Nyanza?

Chimhandamba: In general, Africa has not taken advantage of its abundance of raw materials. It's not only in titanium, but you will find across many minerals we’re generally a miner and maybe some concentration of certain minerals, but with very little value addition. In the titanium space, for example, South Africa, and Africa at large, has an abundance of heavy mineral sands. In heavy mineral sands are companies such as Tronox, Rio Tinto, Base Resources, Masirah Rutile. Some mine heavy mineral sands and then export either ilmenite, zircon, monazite, without any value addition. We use ilmenite, which Africa currently exports ilmenite at prices as low as $300/t. It goes to Europe, Asia or America, where it's put through a chemical process by the likes of DuPont spin-off Chemours, which produces titanium dioxide pigment, and we, as Africa, import that at prices of $3 000/t, as an example. When you look at that, I think the first thing we're trying to address as Nyanza is that it’s time more African companies moved our abundant r...

Junior exploration is an “absolutely critical” component of a sustainable mining industry, and “it is something that we neglect”, Barrick president and CEO Dr Mark Bristow has told the London Indaba.

“We are always engaged in exploration and we are always talking to the junior explorers,” said Bristow.

The Africa-linked Randgold Resources that Bristow ran before merging it with Barrick four years ago had a highly successful discover and develop strategy that resulted in a discovered cost per ounce being considerably lower than the ounces other gold companies were acquiring through mergers and acquisitions (M&A).

When M&A opportunities manifested themselves, they were grasped well beyond the operational assets into major additional asset building through brownfield operation around the assets acquired. The surrounding exploration potential was invariably assessed in cases where assets were acquired and measured against a proven discovery and development yardstick.

Questioned by Indaba chairperson Bernard Swanepoel on the number of people that make up Barrick’s exploration endeavours, as well as the company’s investment in exploration, Bristow responded that the New York- and Toronto-listed company employs about 400 exploration geologists and spends about $150-million a year on greenfield exploration.

“That excludes mineral resource management and reserve extensions of our current operations,” Bristow added during question time at the event covered by Mining Weekly.

On whether the company’s copper strategy would force M&A beyond exploration, Bristow said: “Let’s step back a bit. We started with a great quality portfolio of gold deposits when we merged Barrick and Randgold. Randgold had had some very key tier 1 assets and people mess with the definition of tier 1 now.

“Tier 1 is very clear – 500 000 oz of potential gold production for more than ten years at the lower half of the cost curve, and we’ve got six of those and a couple in the making.

“Barrick also came with some copper assets, some in Saudi Arabia, for which we’ve now increased production by 50% and lowered cost, and the big Lumwana mine in Zambia, which we now have a destination for, and we believe that we’ll be able to add another 40 years to its life, nearly double its production and it’s definitely got the potential to get to five-million tonnes of contained copper.

“Then we’ve got the Reko Diq project in Pakistan, which is, in every sense, a tier 1 copper asset, and we’ll grow our gold equivalent production through expansion of our gold operations and the growth in our copper organically by 25% by 2029.

“So, I think sometimes the market is more hung up about growth through M&A than I am. At the same time, it’s our business to always look for opportunities and to attempt to exploit them when they manifest themselves.

“We’ll continue to do that because everyone that works in Barrick loves gold and copper mining, we follow the market, we understand what’s going on. At the same time, we are very mindful, as the Randgold share price performance showed, where we separated from the market and the gold price as a share price was when everyone else was running around doing M&A from 2011 to 2014, and then it all ended up in tears.

“We end up in tears time and again in our industry, in that we forget what happened last time and so we do it again, just to remind ourselves. The one thing we have is memory, and we reflect on it, as we did back in those early Randgold days. The most important thing is that in Barrick, the senior executive team are owners. They act like owners, so who would want to go and risk the whole value base of a company through reckless M&A?”

ONLY ASSETS WERE EXPLORATION PERMITS

When Mining Weekly first interviewed Bristow in South Africa in 1995, the only assets that Randgold Resources had were exploration permits in West Africa.

Then, following the acquisition of a small mine in Mali, Randgold was listed on the London Stock Exchange two years later, w...

Without the African mineral endowment, there is no chance of an energy transition taking place.

“The fate of humanity rests on the African continent,” Ivanhoe executive co-chairperson Robert Friedland emphasised at the London Indaba on Monday. (Also watch attached Creamer Media video.)

“The way mining is financed now, we’re looking at very limited parts of the earth’s crust where we can responsibly mine,” Friedland said during his presentation covered by Mining Weekly.

A certain suite of a limited number of metals to clean up the world environment and Africa holds the key to a greening future.

“Africa is blessed with the greatest mineral endowment on the planet and it hasn’t even begun to be scratched and mining as an enterprise has to be completely, utterly, and totally reinvented. What we know as the mining industry has to be thrown out,” he said.

Africa would, he said, lead the world in the mining industry by vast margin, with the world’s richest copper endowment being the Katanga province in the Democratic Republic of Congo, which also hosts 78% of the world’s cobalt production.

“We have a society where people don’t know where things come from anymore and when you really have a sober understanding, there’s no chance of us getting to where we want to go without the young people of the African continent – and it’s amazing that this is not understood,” he said.

While there is enough lithium on the planet ­– with just one hard rock lithium deposit in the Congo being enough to supply total global demand – when it comes to the generation of electrical energy and its transmission and end use, engineering one’s way around copper is very difficult.

“Gold and silver conduct electricity better than copper, but they’re just too expensive to the purpose, and there just isn’t enough of it, and by far the largest copper producer in the world was always the Congo, not Chile,” he said.

Eventually the large low-grade copper porphyrys in Chile supplanted the war troubled Congo, which had been the largest copper country until the 1960s.

Chile’s copper grades have fallen from already low levels and the volume of water and energy per rock ground is skyrocketing with solar not a continuous energy answer.

Mining copper in Chile thus tends to increase the environmental problem the world is trying to solve, putting the future into Africa’s hands.

The outgoing and incoming CEOs of Bushveld Minerals this week locked arms to enable the London Aim-quoted vanadium mining, processing and manufacturing company to advance optimally.

In a joint online interview, outgoing CEO Fortune Mojapelo highlighted his commitment to supporting the company’s value-adding energy space and incoming CEO Craig Coltman spoke of tackling financial restructuring, increased liquidity, and balance sheet deleveraging when he officially starts on July 1 and Mojapelo steps down after 11 years of impressive company development.

Bushveld owns two of only four operating primary vanadium plants in the world and Mojapelo pledged to continue to support the carve-out of Bushveld’s energy business strategy and Coltman spoke of the many positive options available and Bushveld’s operations being the full focus of his attention next week – ahead of his official commencement.

“I'm very keen to put my safety boots on, get to the operations and understand the size of the opportunity,” Coltman told Mining Weekly. (Also watch attached Creamer Media video.)

“It's certainly been an interesting journey,” Mojapelo said of Bushveld Minerals, which started as an exploration company with an asset in Mokopane and a tin licence, from which it spun out AfriTin, which is now Andrada Mining, focused on tin, tantalum and lithium.

Six years ago, Bushveld went through its own transformation through its entry into vanadium and the acquisition of Vametco and Vanchem, which turned it into a producer of a broad range of vanadium products.

Simultaneously, it has played a major part in developing vanadium’s role in long-endurance energy storage through Bushveld Energy.

The focus going forward will be on extracting the best out of these assets. On the upstream assets, it will be about squeezing every single kilogram of vanadium out of its assets, as cheaply as possible and ensuring that the balance sheet is less debt-heavy.

Bushveld has been built on the back of existing cash flows and debt, resulting in the balance sheet having some near-term maturities that need to be addressed.

On the upstream, two solid assets should be profitable through the cycle, and on the downstream, the energy business appears to have sufficient critical mass to develop as a vanadium redox flow battery (VRFB) energy storage platform.

Questioned on what he envisages for Bushveld, Coltman spoke of the need for sustainable throughput improvement at Vanchem, the Orion restructure, and, thereafter, evaluation of the next steps.

Bushveld has positioned itself for broad-based involvement through its far-reaching vertical integration model. The company’s downstream business includes the construction of an electrolyte manufacturing plant in East London, the development of a hybrid minigrid at the Vametco vanadium processing plant in Brits, and investment in VRFB manufacturing.

On the company’s vertical integration positioning, Coltman said: “For now, it makes a lot of sense. I have no reason to do anything different to it. My focus is going to be on the mining side in the interim. Fortune is going to be supporting me on the other aspects.”

Coltman will be visiting Vametco’s minigrid on Monday: “Give me a couple of weeks with my feet on the ground as the CEO and we’ll give you a lot more substance,” he said.

Mining Weekly: We’ve been getting calls from people who are in renewable energy and they're saying the delivery time for lithium batteries is horrific. Renewable energy developers needing a lot of storage say they can't get lithium batteries and have remarked to us that, marvellously, they are going to be able to source long-endurance vanadium batteries locally from Bushveld. When will that likely come about?

Mojapelo: The whole premise of Bushveld Energy and VRFBs is that, going forward, the energy transition means that we're going to not only need a lot of stationary storage but also long-duration energy storage, and that is a space which is ideal for vanadium flo...

Mining Weekly Editor Martin Creamer unpacks hopes for the use of Platinum and Palladium in the commercialisation of batteries; calls for SA to produce green hydrogen locally, which could add value to iron-ore; and simple legislation to stimulate Green Hydrogen investment.

Green hydrogen is presenting South Africa with a good target point at a time when the African continent is on the cusp of a massive revolution in the energy space.

“For South Africa in particular, the ability to transition through less carbon intensive fuel sources ultimately to green hydrogen is incredibly important and possibly the only way that we can truly create an energy transition,” Nedbank Corporate and Investment Banking (CIB) infrastructure, energy and telecommunications head Mike Peo told Engineering News & Mining Weekly in a Zoom interview. (Also watch attached Creamer Media video.)

Moreover, the country has abundant land for more wind and photovoltaic projects, particularly the Karoo and Northern Cape, and is positioned comfortably at the tip of Africa to have export markets to the east and west.

“We also have an incredible resources in platinum group metals, which still form an essential part of electrolysers,” said Peo, who was speaking from an energy event in Nairobi, Kenya, where he was part of a panel discussion on the potential of hydrogen as an opportunity for Africa, with the session taking in project preparation, bankability, the requirements of the hydrogen off-taker market, contract structuring, securing bankable off-taker contracts, the readiness of financiers, and aligning regulations.

South Africa’s ability to produce and procure large-scale renewable energy projects had been proven over the last 14 years, with the renewable energy programme attracting R300-billion-plus worth of investment in globally competitive solar and wind power.

At the same time, Saudi Arabia’s large green hydrogen project was attracting attention in being 100% banked as a result of an offtake by Air Products to the US.

“One catalytic project sets the market alight and we start to see people saying it can be done.

“There are projects being developed in South Africa right now where there are challenges with things like project preparation money, but the Japanese, German and British governments all have strategies around their green hydrogen developments. As a consequence, they’ll either subsidise it or provide that type of grant money for big projects that are going to be the forerunners of a green hydrogen re-industrialisation,” Peo forecast.

How would you describe the readiness of financiers to become involved in green hydrogen opportunities?

There's a combination of two things. Number one, we’re seeing virtually every important country with the ability to become either an offtaker in hydrogen, or ultimately a developer of green hydrogen, green ammonia projects, rewriting the policy frameworks. We’re seeing massive government commitment to a policy framework which will take us down that avenue. That starts to get everything moving, but on top of that, because of the complexities and the stress around, for example, financing coal projects, I don't think there's a banking team in the world that is not sitting and looking at the evolution of green hydrogen as a future fuel source. Right now, every team is looking at how we position ourselves. There are a number of peripheral concepts as well as things like carbon trading and carbon credits, which, again, are going to indirectly subsidise production of things like green hydrogen. At this conference, for example, there's a stream that has been unbelievably well attended by every development financing institution, every multilateral institution. Most of the South African banks for example, many of Africa's banks, are at the conference, and they are talking about what next and how are we going to get there.

Is there any one government that is standing out as an example that others can follow?

At the moment the Namibian government appears to be at the forefront of the development. They have already set up the equivalent of the South African Independent Power Producer Office, which was the office set up to procure renewable energy, specifically focused on the development of a green ...