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Mining Weekly Editor Martin Creamer discusses calls for a new mining vision amid release of exploration funds; Platinum’s deficit prediction is up 77% this year, close to a million ounces; and Pan African Resources’ agreement with Juwi Renewable Energies for a solar PV plant in Mpumalanga.

Platinum group metal (PGM) products and services company Heraeus Precious Metals is investing €35-million in the expansion of its PGM recycling capacity at Hanau in Germany, with the buildout forming part of a €300-million global recycling programme.

Last year, additional recycling capacity development began in Wartburg, Tennessee, and Santa Fe Springs, California, and a plant to recover PGMs from spent automotive catalysts in Pinghu, China, together with the German chemicals company BASF. Also in China, a modern PGMs plant in Nanjing was opened by Heraeus in 2018.

Heraeus has a marketing and sales office in Boksburg as well as a PGM chemical compounds production and refinery facility in Gqeberha. The company is closely linked to Johannesburg-listed PGMs-mining company Northam Platinum and is involved in iridium thrifting research with Johannesburg- and New York-listed Sibanye-Stillwater. BASF also has a well-established South African presence.

At Hanau, Heraeus will be building several additional production lines, which will significantly increase its recycling capacities by 2026. The new lines will use electrolytic processes that reduce the use of chemicals and increase process efficiency.

Recycled PGMs have an up to 98% lower carbon footprint than mined PGMs and Hanau’s wet chemical process has the lowest carbon footprint of the recycling processes for PGMs, Heraeus states in a media release to Mining Weekly.

Demand is steadily increasing for recycled materials and circular solutions, driven by growing environmental awareness.

"We’re convinced that demand will continue to increase in the coming years. Only together can primary material from mines and secondary material from recycling meet global demand," said Heraeus Precious Metals business line chemicals head Marius Vigener.

"Our plants are state-of-the-art. We recover precious metals from scrap materials almost completely and investment at the Hanau site enables us to meet the growing demand in Europe in particular," Heraeus Precious Metals business line chemicals technical head Christian Mock added.

Sustainability is of particular importance to Heraeus with the company aiming to be carbon neutral from 2025 and to abandon the use of fossil fuels completely from 2033 amid 63% of the worldwide electricity requirements already arising from renewable sources. The new recycling facilities in Hanau will also be powered by green electricity in the future.

The PGM suite of metals embrace platinum, palladium, rhodium, iridium, ruthenium, and osmium, with PGMs used as catalysts in applications including exhaust gas purification, green hydrogen generation, fertiliser production and in cancer therapy medicines.

As reported by Mining Weekly earlier this month, this year's platinum supply deficit prediction is up 77% to close to a million ounces, with rest-of-year platinum market indications pointing to the need to secure platinum supplies beyond the two main sources of primary mining output and recycled collection.

Over the last five years, between 73% and 77% of total yearly platinum supply in refined ounces has come from mining but the biggest deficit in ounce terms now points to demand having to be met from sources other than mined and recycled platinum, which means effectively liberating platinum from above-ground stocks. Still unclear, however, is exactly what pricing levels are needed to do that.

Among the challenges facing mine supply currently is South Africa’s electricity shortage, which, with other mine supply risks, could result in primary supply being even lower than currently projected.

An exploration borehole in a deposit on the northern limb of the Bushveld Complex continues to reveal new platinum group metals (PGMs) potential at the Waterberg project in Limpopo province, Platinum Group Metals (PTM) CEO Frank R Hallam said on May 17.

"We’re pleased and intrigued to see the results,” added Hallam in a release to Mining Weekly.

PTM is the operator of the Waterberg project and the Johannesburg-listed Impala Platinum is a joint venture partner, along with Mnombo Wethu Consultants, Japan Organisation for Metals and Energy Security, and Hanwa.

The borehole has intercepted PGMs mineralisation consistent with two zones found within the mineral resources and reserves of the Toronto- and New York-listed company’s proposed Waterberg PGMs mine.

The borehole collar was positioned along a projected strike line 16 km north of the one delineated mineral resources zone and 8 km north of the other.

Borehole WE153 intercepted 7.02 m of mineralised T Zone beginning at a depth of 1 272.98 m, the release stated.

The mineralised interval displayed 2% to 4% blebby copper, nickel and iron sulphides. The drill core was logged, and the mineralised intercept recovered was sampled and sent for assay in Australia. The T Zone reported 4PGE platinum, palladium, rhodium and gold assay values of 10.45 g/t.

An F Zone intercept of 9.42 m of 2% to 4% blebby copper, nickel and iron sulphides has been observed. The F Zone drill core will be logged, and the mineralised intercept recovered will be sampled and also sent for assay in Australia.

“Although the step-out distance is too far to allow definitive conclusions, and we are not proposing that a shaft be developed near WE153, the results do support the hypothesis that the T Zone and F Zone continue for a significant distance northward from the known southern deposit area, indicating an opportunity to delineate additional mineral resources that may be accessible from planned underground mine development,” said Hallam,

“Looking to the future, we will consider exploration options at the appropriate time. If underground development of the F Zone in the southern area of the Waterberg deposit commences, drilling to target new T Zone resources to the north of current resources could be executed from drilling platforms established within the F Zone underground development," Hallam added.

The mineralized T Zone and F Zone of the Waterberg deposit are hosted within intrusive rocks of the Bushveld Igneous Complex, which underlie the Waterberg project and dip westerly at 34o to 38o. Along its up-dip edge the Bushveld Igneous Complex is projected to subcrop beneath rocks of the Waterberg sedimentary package, striking north easterly at first, and then in a northerly direction, forming an arc from south to north.

At the southern end of this arc, within the known area of the Waterberg deposit, the T Zone and F Zone both subcrop within 150 m from surface. In the southern area, the F Zone is normally found 300 m vertically below the T Zone and typically subcrops 400 m or more farther eastward than the T Zone.

At borehole WE153, the T Zone and F Zone have been found deeper than to the south and the middling between the T Zone and F Zone appears to have widened to 476 vertical metres. The T Zone observed in this northern area also demonstrates a variation in facies from that seen to the south.

The first R500-million worth of mineral exploration funds will be available from July, Mineral Resources and Energy Minister Gwede Mantashe told Parliament on May 16 when Shadow Mineral Resources Minister James Lorimer stated that a new mining vision can create new poverty-busting jobs and assure a flow of tax revenues to underpin the goods and social services that South Africa needs.

“Give mining a new deal and it could strike a mighty blow against poverty,” said Lorimer.

Mantashe, acknowledging South Africa’s slump to the worst position in recent memory on the latest world mining investment rankings, said on the occasion of the Budget Vote of the Department of Mineral Resources and Energy (DMRE): “One of the indices highlighted in the Fraser Institute survey is the transparency of licensing systems, and to this end, the bid adjudication process for the procurement of a licensing system with integrity is underway and will be finalised by July 2023.”

Said Lorimer. “The promise of explosive growth that should follow from our fabulous mineral wealth, has never been realised.”

Mantashe, in recommitting South Africa to attaining at least 5% of global exploration spend by 2025, stated: “To drive the implementation of this exploration strategy, we have negotiated with the Industrial Development Cooperation of South Africa on an exploration fund for junior miners, which will be concluded by the end of next month. In its first phase, the fund will consist of a combined investment of R500-million.”

The sector created 23 552 jobs between December 2021 and December 2022, resulting in the overall employment of 472 088 workers.

“Our mining industry is not over. South Africa’s mining industry just needs a new deal,” said Lorimer.

Whilst production declined, the value of production registered R1.18-trillion in 2022, up from R1.1-trillion in 2021 on the back of strong global demand.

The South African Revenue Service has reported that mining contributed R89-billion in corporate tax in the 2021/22 financial year. A further contribution of mining to the country’s revenue through royalties stood at R28.45-billion in the same period, keeping its percentage contribution to the gross domestic product at 7.53%.

“This is a clear indication that mining remains a strong pillar of our economy,” said Mantashe.

But the country missed the resources boom of 2007 and the latest boom did not spark the takeoff of the industry as it should have, although it did rescue government finances.

“South Africa’s mining industry built our country into one of the foremost economies of the world. We’re a member of G20. For a long time, we were the biggest economy in Africa. But mining has fallen on hard times,” said Lorimer.

The DMRE is following up on the implementation of 56 Presidential investment conference commitments pledged into the mining and energy sectors, totalling R397-billion. Among them are R16.5-billion by De Beers for Venetia diamond mine, R6-billion by Exxaro for Grootegeluk, R636-million by Impala Platinum for Two Rivers, and R175-million in the Steelpoortdrift Vanadium Project.

“These pledged investments reinforce our assertion that mining is a sunrise industry, ready to bolster South Africa’s economy for years to come,” said Mantashe.

“Yes, people can still make money running mines, and, yes, hundreds of thousands of South Africans make a living and a higher-than-average wage from mining, but given the promise of our mineral endowment, we should have done better,” said Lorimer.

“The industry needs to grow. We need more mining not less. We need mining that focuses on long life of mines rather than cherry-picking and sterilising.

“We need mining that leaves as light and as temporary a footprint as possible so that when it’s gone and the wealth realised, it does not leave decay, spoilt soil and poisoned water.

“We need to understand that mining can rescue our economy if only we let it. A new deal needs a transparent cadastral rights and licensing system...

The platinum deficit prediction for this year is up 77% to close to a million ounces.

This year’s platinum deficit is projected to be a record 983 000 oz amid consistently growing industrial demand on course to becoming the strongest on record, boosted 17% by glass capacity expansions.

Moreover, higher loadings and increased substitution of platinum for palladium have pushed up automotive demand by 12%, with stronger-than-expected positive investment demand resulting in an upped full-year forecast well beyond the 400 000 oz mark.

Rest-of-year platinum market indications are pointing to the need to secure platinum supplies beyond the two main sources of primary mining output and recycled collection.

Over the last five years, between 73% and 77% of total annual platinum supply in refined ounces has come from mining but the biggest deficit in ounce terms now points to demand having to be met from sources other than mined and recycled platinum.

That means effectively liberating platinum from above-ground stocks, but still unclear is exactly what pricing levels are needed to do that.

Amid platinum’s great projected supply fall and big projected demand rise, Mining Weekly put these questions to World Platinum Investment Council (WPIC) research director Edward Sterck. (Also watch attached Creamer Media video.)

Mining Weekly: Your latest Platinum Quarterly indicates that overall first-quarter supply remained constrained and is forecast to remain flat for the full year. What are the downside risks to mined supply in 2023 and what are the other risks to supply?

Sterck: There are a number of challenges facing mine supply at the moment. In South Africa specifically, obviously, there's the electricity shortage, and then more broadly, there have been some operational difficulties at some operations in North America, including some damage to shafts at an operation in Montana. Then in Russia, Nornickel is having to try and navigate its way through the headwinds posed by Western enacted sanctions against Russia. The mine supply projections we've put out for 2023 include an element of all those challenges. If you aggregate guidance, the supply projections are towards the bottom end of the aggregate guidance range that's published by all the companies involved. But that said, if, for example, the power shortage in South Africa continues to worsen and accelerate through the winter months, which are obviously the period for peak electricity demand in South Africa, then yes, there are further potential supply risks to the downside by anywhere between 5% and 15%, so potentially, several 100 000 oz lower than currently projected.

What is drawing investors back to platinum and to what extent will the recessionary environment help or hinder the return of increased platinum investment demand?

If we think about the retail investors, they're driven by preservation of capital during periods of uncertainty. Certainly, the banking crisis that has enveloped parts of North America, and more broadly, has driven a certain degree of interest in buying platinum bars and coins on the retail side, and that buying can be quite material. On the institutional investor side, the motivations are a little bit different. If we think back over the last couple of years, we've seen quite significant outflows from ETFs and those outflows have been driven by two factors. Firstly, investors in South Africa generally had a preference for the mining equities over the metal on expectations of being paid significant dividends by the mining companies. Those expectations certainly came to fruition, and it was arguably a sensible trade there. Then secondly, investors more broadly have been looking for yield. A metal ETF is a non-yielding asset and with rising real interest rates, investors have been compelled to look elsewhere. But in terms of what's bringing them back, within South Africa the challenges facing the mining industry mean that those super dividends may not be so super ...

Precious metals producer B2Gold says its Fekola mining operation, located in Mali, has the potential to significantly increase production.

The Toronto miner’s optimisation study analysis indicates that the combined Fekola mine and Fekola regional processing facilities have the potential to produce more than 800 000 oz/y of gold, subject to the delineation of additional mineral resources.

This is substantially more than what the mine is expected to produce this year, with a guidance of 580 000 oz to 610 000 oz for 2023. In the first quarter, Fekola produced 165 864 oz at an all-in sustaining cost of $964/oz.

Fekola produced its three-millionth ounce of gold on April 27. This milestone was accomplished five years and seven months from construction completion and three years earlier than estimated in the Fekola feasibility study from June 2015. B2Gold notes that Fekola production has met, or exceeded, production projections in each year of its operation.

To further expand Fekola, the company is advancing an engineering study for a regional standalone mill and oxide facilities, which are expected to be located on the Anaconda area.

The engineering study will be based on processing four-million tonnes a year of saprolite and transitional (oxide) resources.

The current Anaconda area mineral resource estimate (MRE), released in March last year, included indicated resources of 32.4-million tonnes at 1.08 g/t gold for 1.13-million ounces of gold, all of which was weathered oxide ore, and inferred resources that included 19.1-million tonnes of oxide ore at 0.81 g/t gold for 0.50-million ounces of gold, and 44.6-million tonnes of sulphide ore at 1.25 g/t gold for 1.79-million ounces of gold.

B2Gold has since completed about 120 000 m of additional drilling at the Anaconda area, which included infill drilling to upgrade a significant portion of the inferred oxide resources to the indicated category, as well as extending both oxide and sulphide resources in the area.

The company says it will publish an updated MRE for Anaconda by the end of the second quarter. To allow for incorporation of this updated estimate into the engineering study, results of the study are now expected in the fourth quarter of 2023.

Gold mining company AngloGold Ashanti is targeting September as the month in which it will invert its stock exchange listings.

Its primary listing on the Johannesburg Stock Exchange will become a secondary listing, its American Depository Receipt (ADR) listing in New York will be uplifted to become a fully fledged primary listing, and the company's domicile will be the UK to keep tax constant for South African shareholders, who hold 40% of the stock.

Sixty per cent of the stock is held outside of South Africa and two-thirds of its share trading already takes place in New York.

“We intend to make this transition as seamless as possible,” AngloGold Ashanti CEO Alberto Calderon, a former International Monetary Fund luminary, told journalists in a media briefing on May 12 in which Mining Weekly participated.

“Today we announce the proposed redomicile of AngloGold Ashanti. In recent times there has been increased focus on the main drivers of AngloGold Ashanti, starting with the operating model and optimizing of our assets and then moving to strengthen our senior leadership team and refresh our overall organisational culture and values.

“We have made good progress in each of these areas and expect them to continue to bear fruit in the coming months and years.

“In parallel, we have examined the question around the most appropriate corporate structure and determined whether there was latent value to be unlocked. It has been a persisting question from our shareholders, particularly with the disposal of our last substantive operating assets in South Africa.

“After concluding a comprehensive review, we have decided on the following thought process.

‘The first thing is that more than 99% of our people are outside of South Africa, where we no longer have any assets.

“It is also evident, when you look at the current corporate structure, that we are disadvantaged versus our North American peers in several metrics, for example, shares selling at a significant discount.

“Nevertheless, we recognise and value our South African heritage and history. We also respect that 40% of our shareholders are South African today and that still more than 60% of our production is in Africa.

“So, this led to a fit-for-purpose structure where we would be a UK corporate domicile. Importantly, being domiciled in the UK will imply a seamless transition for especially our South African shareholders.

“In addition to this, we will plan to have a US listing on the New York Stock Exchange, which is where our ADRs are today. The very interesting thing is that today, two-thirds of the shares are already negotiated on that stock exchange. So, we’re building up from an historical position which is important, and with this, we will have access to the largest pool of gold capital in the world, that is New York.

“Let me, before finalising, recognise and thank the South African government and the South African regulators for their constructive and understanding approach to this negotiation. I’d like to recognise that historically, we would not have been able to grow and incorporate Ashanti and others without the collaboration and the permission from in particular the SARS and the Reserve Bank of South Africa.

“We intend to make this transition as seamless as possible. The Johannesburg office will remain the same, we’ll have the same board and other things. We’re talking about a cost of around 5% of market capitalisation but that is linked to the share price.

“Finally, we expect to close this transaction around September of this year if we get the support of our shareholders,” said Calderon.

PART OF A SUITE OF OPTIONS FOR SOME TIME

Inverting its stock exchange listings has been part of the suite of options that AngloGold has stated it may pursue to enable the company to have discussions with the government first and the market second.

“I’ve been on the other side. I began my career in government and you don’t want to feel pressured at all, and I can say that they understood t...

Mining Weekly Editor Martin Creamer notes that Glencore will study the feasibility of the creation of a hydrometallurgical facility in Italy; Sibanye-Stillwater is pushing on with its own generation of energy; and exploration investment in South Africa needs to be made more attractive.

Will it be 100% battery electric vehicle (BEV) dominance by 2035? That was the question posed in the title of the SFA (Oxford)'s Battery Metals Lectures on May 11, when slides projected a 45% BEV penetration of the light passenger vehicle market by 2030.

SFA, headed by CEO Henk de Hoop, forms part of the battery metals, platinum group metals and gold mining group Sibanye-Stillwater and the event coincided with the laying of the foundation stone of the Keliber lithium refinery in Finland, which is 79% owned by the Johannesburg- and New York-listed company, which is headed by CEO Neal Froneman.

Despite the slowing growth of total vehicle sales, there is a rapid growth in vehicle electrification, with the projection being 44-million BEV cars by 2030 globally, compared with 8.8-million last year. (Also watch attached Creamer Media video.)

Graphs displayed BEV development speed trailing the banning by countries of diesel and petrol mobility and highlighted France’s planned banning of diesel mobility next year, petrol mobility by 2040 and internal combustion engine (ICE) sales by 2040.

With electrification, the automotive industry is shifting from being a direct consumer of electricity.

The shift is creating a long and complicated car battery supply chain, involving nickel laterite ore and spodumene ore mining and refining.

Former outwardly looking countries are turning inward to in-source mineral extraction and battery manufacturing.

National raw material dominance is presenting geopolitical risk causing car makers to directly source lithium, nickel, cobalt and manganese for electrified light vehicles.

Moreover, the decarbonising of the automotive industry is demanding cradle-to-mine-gate and cradle-to-grave life-cycle assessment embracing raw materials, disposal, product use, fuel or charging, logistics, processing, battery cell assembly and car assembly.

Nickel content per vehicle is poised to increase and chemical mixtures like lithium carbonate and nickel sulphate are gaining prominence.

The increasing battery demand is leading to a surge in demand for critical lithium, nickel, cobalt metals – cathode active and anode active materials, with Europe and North America facing a regional deficit for particularly anode active material.

Minimum recycled material content is being laid down, with Europe’s proposal demanding a minimum of 12% recycled cobalt and 4% recycled nickel and lithium as at 2030.

Key takeaways from the presentation of S&P Global Mobility auto supply chain director Graham Evans on the BEV market and the global outlook, included:

the need for collaboration between countries that host abundant raw materials and those with the high demand for vehicles to achieve carbon neutrality;

battery life-cycle assessment being crucial to car manufacturers' decarbonisation strategy owing to the significant impact of BEVs on the carbon footprint of the entire value chain;

projected material deficits and prices posing challenges, with total battery demand for light passenger vehicles forecast to be about 3.5 TWh in 2030;

the need to ensure the flexibility of battery platforms to support diverse materials and capacities; and

the need for car manufacturers to progressively adopt battery recycling and reuse practices.

Volta Trucks sustainability principal David Amienyo reported that global lithium demand was projected to rise by nearly 3 000% from 2020 levels under a scenario where 40% of vehicles were BEV by 2050.

Under a scenario of 100% of vehicles being BEV by 2050, the need for lithium more than doubles to more than 7 500 %.

In the heavy-duty sector, battery-related critical metals used in heavy-duty electric vehicles could account for 62% of critical metal demand in the decades ahead, despite accounting for between 4% and 11% of the total road fleet in some countries.

Heavy-duty vehicles emit a quarter of greenhouse gas (GHG) emissions from road transport and 65% of the European Union’s total GHG emissions, with estimates fro...

An outline of the short-term and medium-term renewable energy plans of South Africa’s large platinum mining companies is outlined in the latest Auctus Metal Portfolios report, a 16-page document compiled by independent precious metals consultant Dr David Davis.

Auctus Metal Portfolios of Singapore offers a physical precious metal investment management system that includes platinum, palladium and rhodium.

The report puts the planned short- and medium-term generation of the four main platinum group metal (PGM) producers at a collective 295 MW, and the collective short- and medium-term generation of South Africa’s private sector at 3 000 MW, with 9 000 MW in the longer-term planned pipeline of projects. (At the time of going to press, Mining Weekly is informed that renewable energy projects in the pipeline now total 13 000 MW.)

By the end of this year, the report states that a 100 MW PGMs project is scheduled to be operational, and by the end of next year, the 3 000 private sector megawattage is expected to materialise.

The report highlights Sibanye-Stillwater’s proposed three-project plan as introducing 175 MW of renewable energy across the company’s PGM mines in South Africa, made up of an 80 MW solar photovoltaic (PV) project at Rustenburg Platinum Mines, a 65 MW solar PV project at Karee, and a 30 MW solar PV project at its Bushveld Complex. (Relaxation of regulatory requirements and the anticipated ability to trade electricity in South Africa have, as reported by Mining Weekly, allowed Sibanye to grow its portfolio of renewables projects to 557 MW, including solar and wind projects.)

The Auctus report states that it will be Anglo American Platinum’s 100 MW solar PV plant at the Mogalakwena mine in Limpopo that will be operational by the end of 2023. (Mining Weekly has reported that the Anglo American group as a whole will this year commence the contract for the first two projects in a 600 MW bucket. That initial 600 MW of renewable energy will then progress to a possible 5 000 MW as part of the company’s Envusa energy programme, which has been given the status in South Africa of a strategic integrated project.)

Scheduled for commercial operation in 2024, the report adds, is a 10 MW solar PV project at Impala Platinum’s Marula platinum mine in Limpopo, with Northam Platinum targeting modules of 10 MW. (As reported earlier by Mining Weekly, the largest of three planned solar installations at the moment is the 11 MW solar installation, which is under construction at Northam’s Zondereinde PGMs mine, which will be followed by commissioning of installations at Northam’s Eland and Booysendal PGM mines. Northam is also looking to wind power.)

The Auctus report emphasises the decline of Eskom’s ageing fleet of coal-fired power stations and the impact on PGMs platinum mine supply from South Africa and globally. Under the circumstances, it expects an increase in PGM inventories, along with a decline in supply from 2023 to 2027.

OPERATIONAL GOLD MINE RENEWABLES

Gold mining companies have got off the mark with embedded generation of renewables, Pan African Resources with 10 MW on the Far East Rand and Gold Fields with 50 MW on the Far West Rand. Moreover, Gold Fields has more recently discovered unexpected on-site wind strength at its South Deep gold mine, near Westonaria.

Those very close to situation report to Mining Weekly that they are beginning to see a small flicker of light at the end of South Africa's terribly disruptive loadshedding tunnel.