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Over the past two years, Pretoria-based rare earth (RE) minerals refinery Rare Earth Refiners (RER) has designed, built and commissioned a demonstration plant for the green production of RE fluorides using a R15-million grant from the Technology Innovation Agency (TIA).

REs, and especially neodymium trifluoride (NdF3), are extensively used in the production of permanent magnets used in electric vehicle (EV) and wind turbine electric motors.

REs are also used in EVs for component sensors (yttrium); headlight glass, speaker magnets, windows, seats and ventilation systems (neodymium); liquid crystal display screens (europium, yttrium and cerium); and high-performance batteries (cerium lanthanum).

The manufacture of neodymium metal requires the availability of NdF3.

The development of the RE beneficiation technology started in 2012 by a team at the South African Nuclear Energy Corporation (Necsa) with financial support from the Department of Science and Innovation’s (DSI’s) Fluorochemical Expansion Initiative (FEI).

RER has been granted the exclusive licence to industrialise the technology.

DSI chemical and related industries director Dr Mahlori Mashimbye says the main drivers of the FEI are the DSI, the Department of Trade, Industry and Competition and State-owned companies Pelchem and the Industrial Development Corporation (IDC).

TIA commercialisation executive Brian Mphahlele says the plant is aimed at leveraging, in the long run, South Africa’s RE mineral deposits (fluorspar in particular), coupled with the country’s rich fluorination heritage to increase local beneficiation.

South Africa has various sources of RE, including deposits of monazite ore, phosphate ore, fluorite, monazite in heavy mineral sands and in phosphogypsum stockpiles – a by-product of phosphate fertiliser manufacturing.

“The successful demonstration of this technology is in alignment with our objective to ensure sustainability and economic growth through beneficiation of South African raw materials and to industrialise our core technologies,” says Necsa acting research and technology development divisional executive Dr Jan Rijn Zeevaart.

PLANT TRIALS

The first process tested using the plant was the production of NdF3 from neodymium carbonate, with a conversion of greater than 99% being achieved.

RER plans to further enhance the plant to gather more information about its process and maintenance over the next few months.

RER CEO Dr Jacobus Swanepoel tells Mining Weekly the process is 'green' because traditional methods of producing NdF3 use wet acidic routes that produce a lot of acidic waste and usually deteriorate the area where it is used.

In place of this, he explains, the RER plant uses dry fluorination technology developed and patented by Necsa, the only by-products being a small amount of water vapour and carbon dioxide.

An additional drive in the technology is to beneficiate other local REs, which are produced primarily as part of certain companies’ waste streams. As such, RER’s plant would be able to assist miners in beneficiating REs as another by-product.

RER co-owner Dr Ryno Pretorius says he spent the past nine years industrialising this technology and that it was a “dream come true” to progress it from an idea to a successfully operating plant.

In addition to operating the plant, he was also the lead engineer in its design, construction and commissioning. Pretorius holds a doctorate from the University of Pretoria’s department of chemical engineering in the fundamental aspects of the RER/Necsa process.

VALUE CHAIN ADDITION

Meanwhile, Swanepoel notes that, although more than 85% of the world’s RE market is owned and controlled by China, South Africa holds the potential to supply more that 10% of global RE demand.

In this regard, he says that, with the RER plant and Necsa technology, South Africa now possesses the technological expertise and raw materials for the establishment of a full value chain - from mining to end-product - electric drive...

Right now, the market is recognising the higher likelihood of platinum being in deficit rather than in surplus in the mid-term years ahead, said World Platinum Investment Council (WPIC) research director Trevor Raymond on Thursday.

Raymond expects pent-up consumer demand for vehicles to reduce any surplus, along with the substitution of platinum for palladium, which he describes as being "very material". (Also watch attached Creamer Media video.)

“What we do know is that as soon as the automakers are able to resolve the semiconductor issue and chips start to flow, consumer demand hasn’t really gone away,” Raymond told Mining Weekly in a Zoom interview.

Despite the release of built-up platinum material that will come through this year and next, supply still has the word constraint written all over it in the years ahead.

“The delta variant isn’t doing as much harm as the market believed it might. There certainly is pent-up consumer demand, so as those chip shortages are resolved, which we actually think will take place in 2022, you might have higher estimates than are currently in place. That will certainly give you more demand and reduce any surplus,” said Raymond.

“So, other than in these two or three years, there’s certainly a far higher likelihood that platinum will be in deficit than in surplus, and we think that’s what the market is recognising right now,” Raymond reiterated.

“There's been a lot of concern about the semiconductor shortages and how they might impact certainly vehicle production and I think that’s played into negative sentiment towards platinum and palladium.

“Firstly, let’s just recall why there is this chip shortage. I think during the pandemic there’s been huge demand for electronic goods – iPads, screens, computers etc – so there’s been huge demand for these chips. There’s also been disruption to the global supply chain both in the manufacture and the distribution of those chips.

“In terms of vehicles, you know from your own vehicle that there’s been a proliferation of chips, with all sorts of things that can do all sorts of things, and I’ll come back to how automakers are trying to address that.

“But in general, we’ve had concerns about the number of vehicles being produced both from a semiconductor chip shortage point of view and just in terms of economic well-being and consumer preferences. What we’ve seen from organisations that forecast vehicle production is that predictions have been extremely volatile.

“They’ve been up and down and you’ve heard numbers thrown around of three, four, five, six, seven million fewer vehicles, and you need to be quite careful which vehicle group you’re looking at. But in general, we think there’s a swing of three to four million vehicles in the last few months. That certainly is relevant and we’ve tried to unpack what that means in terms of platinum group metals.

“We used Fitch forecasts because they’re the most public and available to investors, to anyone who wants to have a quick look and see; IHS are a little public but in general. We took both light duty and heavy duty vehicles and around about 85-million vehicles are to be produced in 2021, and that could then come down by two, or three or four million vehicles.

“So what we’ve done is that if you believe that there will be a loss of about say three million vehicles from 85-million down to 82-million vehicles, what that means for platinum is a loss of about 35 000 oz of platinum per million vehicle production that is lost and that’s light duty and heavy duty,” said Raymond.

“If you look at palladium, you see that that loss is about 105 000 oz per million vehicle production that is lost. The reason is that there are more gasoline vehicles than diesel vehicles. Globally, there are about 20% diesel vehicles in the world and about 80% gasoline vehicles, so you would expect it to be more profound with palladium.

“If you take three million vehicles down in production, and this allows anybody to take their own view on ...

The South African mining sector can remain internationally competitive and support socioeconomic development only if it drives decarbonisation and adapts to the global shift in commodity demand towards minerals used in green sectors such as renewable electricity and electric vehicles (EVs), a new study shows.

However, the country will have to materially ramp up its exploration for the critical minerals required in emerging green technologies if it is to succeed in offsetting the decline in coal mining, as well as some platinum group metals (PGMs), notably palladium.

Produced by the National Business Initiative (NBI) in partnership with Business Unity South Africa and the Boston Consulting Group (BCG) as a precursor to South Africa’s participation in the COP26 climate talks in Scotland, the study warns that about 60% of the mining industry’s current workforce is at risk as a result of “shifting value pools in commodity markets”.

In 2019, the sector provided 460 000 direct jobs of which PGMs, coal and gold accounted for about 168 000, 94 000 and 93 000 respectively, the study states.

Presenting the findings this week, BCG’s Colin Kinghorn said that, while the phasing out of coal would affect about 20% of current employment and 26% of current revenue in mining, significant opportunity remained in the sector if green-tech mining value chains could be developed.

To achieve that objective, the country’s exploration target of R8-billion-a-year had to be met by 2026, supported by the policy and infrastructure that could leverage both local and regional deposits.

“As the world decarbonises and large renewables production is deployed, demand for commodities will shift drastically,” he said.

This shift posed a risk to South Africa given that a number of its current commodities were leveraged to technologies that would decline, while the country did not have large resources of several of the critical minerals that will be in high demand, such as cobalt and lithium.

Nevertheless, there was still growth potential for commodities such as chrome, manganese, gold, platinum and iron-ore, which South Africa already mined at scale.

To adapt to the change in value pools, the study urges a transition to mining increasingly in-demand, clean-tech commodities, while driving market development related to the use of specific commodities in clean-tech applications.

“Enabling the development of a climate-resilient, competitive mining sector requires public-private sector coordination along a common commodity exploration, production and beneficiation strategy, a conducive policy environment, cheap finance and access to reliable, affordable, clean energy supply,” the study asserts.

The release of the NBI findings coincided with the release of the International Energy Agency’s latest World Energy Outlook, which shows that the rapid deployment of low‐carbon technologies will result in a significant increase in demand for critical minerals.

Under its net-zero emission (NZE) by 2050 scenario, the IEA calculates that mineral demand for EVs and battery storage will rise by well over 50‐times by 2050, while the expansion of electricity networks leads to a doubling of demand for copper for power lines over the same period.

Lithium sees the fastest growth among the key minerals, with demand up over 100‐times its current level through to 2050, while cobalt, nickel and graphite also see rapid demand growth.

Copper demand registers the largest absolute growth, rising by around 14-million tonnes by 2050, expanding the size of the global copper market by 60% in the period.

“As a result, in the NZE, clean energy technologies emerge as the fastest-growing segment of demand for most minerals, evolving from a niche consumer to a leading source of demand,” the IEA reports states.

Even under the IEA’s most pessimistic scenario, the overall requirements for critical minerals for clean energy technologies nearly triple between 2021 and 2050.

The NBI study, meanwhile, indicate...

Harmony Gold is at a very exciting point as it pivots in a new portfolio-enhancing direction and sheds costs at the same time, says Harmony investor relations head Jared Coetzer.

“That little paragraph that we came up with about re-engineering our portfolio and deleveraging our balance sheet to create optionality. That’s exactly what we’re doing, summarised in one sentence,” says Coetzer, who spoke to Mining Weekly in a Zoom interview.

While conceding that the JSE- and NYSE-listed gold mining company’s cost base has been on the high side relative to other global miners, he points out that the strategy being executed involves driving down all-in sustaining costs while elevating the portfolio of assets at the same time.

Harmony, which produced 1.54-million ounces of gold in financial year 2021 (FY21), is headed by highly experienced CEO Peter Steenkamp. The company has nine underground mines and one opencast mine in South Africa, and one opencast mine in Papua New Guinea, where it also holds 50% of a copper/gold project in joint venture with Newcrest Mining.

Harmony’s FY21 production profit of R12-billion was 66% up on the R7.2-billion of FY20.

“We’ve taken the decision to invest in our own assets,” says Coetzer.

With life-of-mine approaching termination point at Harmony’s Masimong, Bambanani, Kusasalethu and Hidden Valley operations, R6-billion-plus is poised to come off costs in the next three years, as Harmony also begins to advance its high-grade Tshepong and Moab Khotsong/Zaaiplaats developments.

If everything goes to plan, costs will have lowered to below R700 000/kg in real terms by financial year 2024 (FY24).

“That’s a story which is very powerful,” says Coetzer.

Harmony received a gold price of R851 045/kg in FY21.

The assets that Harmony has acquired from AngloGold Ashanti have moved the company up the quality and grade trajectory, regardless of how things turn out at Wafi-Golpu, the Papua New Guinea copper/gold project in which Harmony has a 50% shareholding in joint venture with Newcrest and which has reserves estimated at 20-million ounces of gold.

The best and quickest return on investment will likely be from the extension of the large Kareerand tailings facility at Mine Waste Solutions, cash flow from which will also help to fund the project.

ZAAIPLAATS PROJECT

The Zaaiplaats project will take mining 400 m deeper into an area where payshoots have been exceedingly well studied and the grades are high.

Moreover, inefficiencies at the existing middle mine have been targeted for removal as Harmony builds the Zaaiplaats extension.

“We’re going with a triple decline and I think the big challenge is to make sure that there’s not a prolonged period of reduced production as mining extends from the existing middle mine to the new Zaaiplaats mine,” says Coetzer.

“The upside is that we can actually develop those declines quicker than what we've got on our plan and Peter sees a realistic chance of doing that.

“At 9 g/t, the all-in sustaining costs at Zaaiplaats are around $1 090/oz or R512 000/kg. You’re not going to find a project like that anywhere in the world – and certainly not at the price at which we got it. It’s been paid for. The development is obviously going to be costly but it will be funded from the existing operations,” says Coetzer.

Mine life is extended by 24 years, there is existing operational leverage and costs will be recapitalised, which is tax positive.

“There are just so many benefits,” says Coetzer, who concedes that ventilation and energy costs will rise along with the additional depth.

“We understand those costs well and we’ve never shied away from that and one of the important messages that Peter is continually driving home is that our stakeholder relations are better than they’ve been in a long time.

“Evidence was the wage negotiations. To have all five unions come to the party simultaneously is a phenomenal result. We’ve managed to put our people first and we got to a result that everyone was ve...

The construction of TSX-listed Ivanhoe Mines’ construction of the Kamoa-Kakula's Phase 2 concentrator plant is proceeding ahead of schedule.

Designed to double copper production to about 400 000 t/y, the project team now expects to start operating the concentrator plant in the second quarter of 2022, compared with the third quarter as initially planned.

The 3.8-million-tonne-a-year Phase 2 concentrator plant is a carbon copy of the Phase 1 concentrator plant, and is being built alongside the Phase 1 plant.

All long-lead items of equipment, structural steel, platework and mechanical equipment for the Phase 2 plant are already delivered to site or are en route. As of the end of September, the Phase 2 plant was more than 50% complete.

Ivanhoe founder and executive co-chairperson Robert Friedland on October 12 enthused that the ahead of schedule and on-budget achievements at the project “stand tall and shine brightly in a Covid-19 world where mining, infrastructure and other industrial projects are routinely massively delayed, hindered by supply bottlenecks and predictably subject to significant cost over-runs”.

Also at the end of September, Kamoa-Kakula had surface ore stockpiles of about 3.6-million tonnes, grading 4.73% copper, containing more than 173 000 t of copper.

These stockpiles are in place to help ensure a smooth and efficient ramp up of the Phase 2 concentrator to steady-state production during 2022, the miner said.

Mid-tier South African gold mining company Pan African is building two schools for its communities, has handed over a clinic in Barberton, is planning to embed 35 MW of renewable energy, is constructing a water retreatment plant that will pretty much eliminate the use of potable water altogether at Evander, and has a large-scale blueberry project in Barberton that will create 400 seasonable jobs a year now and many more as it is expanded.

All these activities point to the London- and Johannesburg-listed company answering the environmental social and governance (ESG) call with considerable intensity.

“ESG is critically important for us in our business,” Pan African CEO Cobus Loots highlighted in a Zoom interview with Mining Weekly. (Also watch attached Creamer Media video.)

The company has had an outstanding 2021 financial year (FY21) to June 30; profit rose 68% to a record of close to $75-million and a record dividend declaration has been recommended.

Pan African’s record performance has again been underpinned by a feet-on-the-ground approach of consistently under-stating and then over-delivering on production front.

First it guided FY21 gold production at 190 000 oz; it then upped that to 195 000 oz – ­and then crossed the finish line with 6 777 more gold ounces than forecast at 201 777 oz.

By year end, Pan African will be generating its own 10 MW of solar power at Elikhulu tailings retreatment operation at Evander, which will take this already low-cost operation even further down the cost curve.

Mining Weekly: Several independent analysts have been waxing lyrical about Pan African and talking about your stock potentially not just doubling in value but more than doubling in value. What are the hard facts and figures that are giving rise to these far-reaching share price projections by normally difficult-to-please analysts?

Loots: What certainly has assisted us in recent years is Elikhulu. The contribution of that plant helps us to also reduce our all-in sustaining cost of production. Our guidance for the year ahead is a minimum of 195 000 oz – so very similar to what we did in FY21. That means that assuming the gold price remains cooperative, we will again have a great year from a financial perspective. Also important is the contribution from Evander 8 Shaft operation, specifically the pillar. In the first half of the financial year, we had some difficulties but in the second half the team really redeemed themselves and we’re looking forward to a great contribution from that pillar operation, also in the upcoming financial year.

What has Pan African got in store on the near-term growth front?

The good thing is that our circa 200 000 oz of production is very stable and shareholders can pretty much bank on that level of production. Then internally, we have some very attractive growth. With the pillar project we’re doing about 35 000 oz to 40 000 oz a year. We managed to extend the life of that project to five years by including 24 level. And then, we’re going to do 25/26 level or the Egoli project at Evander. That’s internal growth that can take production from an underground complex at Evander from say 35 000 oz/40 000 oz to pretty much double that. I think that’s quite attractive. Then at Barberton, we’re developing into the Royal Sheba orebody – lower grade for Barberton but mechanised and low cost. That’s going to be a substitute for the BTRP at Barberton but I also see some upside as far as that project is concerned. That’s internally what we have in store. Then, as we’ve again flagged to the market, we’re busy with a definitive feasibility on the Mintails project, another potential tailings operation. The results of the prefeasibility study were very encouraging. In the next months, we would hope to complete that definitive study and make a call on proceeding. If we do proceed, that’s another 50 000 oz of production, very similar to what we’re doing at Elikhulu.

What more can be expected from Pan African on the lower-c...

Exploration is key to keeping South Africa on the right side of the future-facing metals scenario, the Joburg Indaba heard last week from potential investors.

During a panel discussion on mining sector prospects covered by Mining Weekly, the heads of international investment companies commented that major mining companies should start dipping their toes in the waters of the likes of lithium and rare earths to gain exposure to emerging future-facing critical metals.

Moreover, the investor firm commentators concurred that South Africa’s green energy and green hydrogen opportunity could potentially unlock significant inward investment.

In response to Rothschild & Co London mining team senior adviser Fiona Perrott-Humphrey who served as panel chairperson, Resource Capital Funds MD Australia Brett Beatty highlighted exploration as the opportunity through which South Africa could attract capital investment.

Metals Acquisition CEO Mick McMullen said there was absolutely no reason why South Africa could not get behind the green hydrogen opportunity, and Blackrock natural resources MD Olivia Markham said there was merit in major mining companies creating options around some of the future-facing metals.

It was suggested that South African assaying should include lithium especially since lithium discoveries had been made in Mozambique and Namibia.

Perrott-Humphrey: Can you give a view on how best the South African mining companies can assure that they’re on the right side of short- to medium-term developments?

Beatty: I think a key is exploration. A country like South Africa has great geology and great infrastructure and I think a pipeline of new projects will attract capital investment. Exploration drives your service industry and it captures your human talent within the country. South Africa has a part to play but it needs to be able to demonstrate that it is a reliable partner and to attract capital.

McMullen: It will take a fair bit of time to generate projects in South Africa and for the political system to mature sufficiently to provide that stable system that can attract large amounts of capital, because when it comes to some of these future-facing materials such as rare earths and even lithium, you’re talking big capital numbers to develop. A decent size rare earths mine, Mountain Pass in the US, I think is at $1.7-billion. People aren't going to put that sort of money in unless they have certainty.

Perrott-Humphrey: What should the mining majors be doing in this green, critical and future-facing metals environment?

McMullen: The first thing they should do is make sure their balance sheets are very strong – bullet proof, would be the way I’d look at it – and then start dipping their toe in the water of some of these new metals, not a traditional copper or nickel, but your lithiums and rear earths, because I think fundamentally investors want to see that they’ve got some exposure to those future-facing metals. But right now, those metals are not dividend yield stories. They’re really about the future and that’s the equity story. The equity market’s going to give you that higher valuation but there’s no meaningful Ebitda multiple that these things trade at because they often don't have any Ebitda. So, I think that for larger companies and medium-sized companies, they should make sure the balance sheet is solid first, get the business in order and then start dipping a toe into some of these other things – like Neal Froneman of Sibanye-Stillwater has done. He’s bought into a nickel smelter refinery. He’s entered into lithium deal in Nevada. He was an early mover in expanding beyond South Africa by buying Stillwater, and now you can see he’s an early mover into the future-facing metals. Small bets but if they pay off, it will give his company a differentiation versus the other traditional South African mining companies.

Perrott-Humphrey: Isn’t it right to say to the big guys, go to the risky places, otherwise riskier companies will...

South Africa’s current mining boom is papering over some very serious structural issues that underlie the mining industry as a whole.

“Chief amongst those is the slowdown if not disappearance of investment in future capacity, a trend we’ve been seeing for the past ten years,” said Nedbank mining and chemicals senior lead Vusi Mpofu, who was speaking to Mining Weekly in a Teams interview. (Also watch attached Creamer Media video.)

"In terms of expansion and exploration, South Africa has definitely been on a downward trend. Despite the quality and the output of product that comes out of South Africa, we have infrastructure challenges from a logistics perspective. A number of players within mining are struggling to get product to market as efficiently as we possibly can, bearing in mind that we sit on the southern tip of Africa," said Mpofu.

“We may be able to compete in terms of all-in sustaining costs at the operations, but we still have a logistics challenge. To the extent that we don’t have more efficiencies within that particular chain it becomes a disadvantage for the sector as a whole,” he added.

“The other issue which I would place in my top three detractors of a mining boom for South Africa, particularly going into the next ten to 15 years, is the policy uncertainty.

“There have been improvements in recent years. We don’t have as fractious a relationship as previous policy makers have had with the mining sectors but we are still not where we should be. Add to that the capacity constraints that are built into our statutory and government bodies that ultimately still have to implement this policy.

“We have quite a few things that we should be working on as government and as the mining sector as a whole,” Mpofu emphasised.

Mining Weekly: What is the potential the South African mining sector is missing out on?

Mpofu: To the extent that we want to be able to grow South African industry, create more jobs and improve our gross domestic product for South Africa, we are in a race that competes for foreign direct investment from capital that comes out of Canada, London and Sydney and that capital has, over the years, been finding its way to other geographies. You will find that the rest of the African continent has progressively been eating up more of that investment spend. A lot of it is also going to South America and it becomes a sad indictment on South Africa as a whole if you find that people find it easier to mine in war zones than it is to mine in South Africa, not only from a policy perspective but also from the stability of energy. Moves in the power space to permit generation of up to 100 MW is the kind of revolutionary thinking that we need. The level of interest that has responded to this is testament to that bigger step in the right direction.

What else do we have to do to rise to the required higher level?

If you look at the Northern Cape and the commodities such as iron-ore and manganese that you normally find there, investment in particularly exploration is needed. I would caution whether we need to be equally aggressive in platinum group metals (PGMs). In the past we’ve found that we must stay away from the Kool Aid. Yes, we’ve got elevated prices that can create an impression of viable investment cases at current levels but capital will follow viable investment cases. If you look to the demand dynamic and outlook, we still have sufficient capacity from a PGMs perspective. Gold is where it is. We are running gold mines with all-in sustaining costs that cannot compete with global standard. What can we do on that front? Not much, when you look at gold, apart from investing in technologies that can try and optimise some tailings extraction for gold. There are a few levers and it will all be dependent on the particular focus.

Achieving net zero carbon emissions between now and 2050 has been a fast-evolving topic with lots of work being done in the mining industry, particularly around its Scope 1 and 2 emissions, Standard Chartered Bank MD and sustainable finance head Daniel Hanna said this week.

He addressed the Financial Times (FT) Mining Summit on October 7, noting that the banking, finance and mining industries were all challenged by Earth’s climate emergency, with a growing focus by consumers, investors and regulators on the importance of the principles of environment, social and governance.

In this regard, he noted that a number of factors had come together and were accelerating.

For example, he pointed out that, when he last spoke at an FT Mining Summit, the net zero asset owners alliance – a group of investors focussed on their investments being aligned with net zero – was only just created. The alliance now had more than $40-trillion-worth of assets under management.

“That is eight times the amount [compared to when] I last spoke to the FT Mining Summit,” he pointed out.

In addition, he explained that "green growth" was going to require a lot from the mining industry, such as copper, graphite, lithium and a number of other critical metals, with increases in demand of between 250% and 500% expected in future.

Glencore sustainable development head Anna Krutikov, meanwhile, told delegates participating in the summit that there were a couple of other “really important” considerations as companies ramp up their net zero efforts, including a “tidal wave” of commitments from key jurisdictions around the world.

“This time last year we saw a commitment from China to achieve net zero by 2060, the European Union developing the regulations supporting their commitments, and the US going back into the Paris Agreement,” she said.

These commitments are significant, said Krutikov, because they normalise concepts of net zero by 2050 which has become the “new expectation”.

She noted that normalising net zero concepts was an important step for the mining industry. She added that the industry was likely to soon see the beginning of efforts to operationalise some of the commitments made thus far.

“There is a lot more work to be done; there are a lot of questions we do not have answers to today, but it is incredibly exciting to see how some of these commitments, which were essential as a first step, are now starting to translate into action,” said Krutikov.

Also, she noted that customers of the mining industry, such as automotive original-equipment manufacturers, for instance, have been at the forefront of thinking about how that industry understands its carbon footprint, how it thinks about it in a holistic way – from “cradle to the [end-product] the car” and how it works together with its value chains to drive decarbonisation.

“[This creates] a virtuous circle of commitments driving policy detailing, driving a lot of these conversations happening not just horizontally in the industry but also vertically throughout the value chain,” said Krutikov.

The business community of South Africa, including coal miners, coal processors and unions, shares the sentiment that the just energy transition must be implemented in a responsible manner if the country is to reach carbon neutrality and not damage the economy.

Sasol Mining senior VP Lucky Kgatle says the company sees the energy transition as a national and global imperative.

Parent company Sasol is aiming for the group to achieve an 80% reduction in emissions by 2030, and ultimately achieve net zero by 2050.

“Net zero carbon emissions by 2050 is necessary if we are to stay within the 1.5 ˚C world temperature rise window set by the Paris Agreement and avoid catastrophic climate change at a global scale.

“Considering that Sasol is the second-largest emitter after Eskom, we have a responsibility to lead a change to a low-carbon future.”

Kgatle acknowledges that South Africa is a developing country and that it requires a just energy transition to not leave behind displaced jobs and livelihoods.

That said, Sasol still sees coal as an integral part of the energy mix for the foreseeable future, before progressively declining.

Sasol has intentionally designed its decarbonisation strategy to allow for a just transition to lower-carbon feedstocks such as gas and green hydrogen over time. The company is also taking care to respond to air-quality concerns and greenhouse-gas emissions management – including by using more liquefied natural gas and optimising boiler technology.

“While we do not foresee significant employment reduction prior to 2030, there will thereafter be impact and hence our setting up of a dedication transition office, which is already undertaking programmes to minimise negative impacts that will come with such a transition strategy,” Kgatle states.

He believes it is crucial for renewable energies and hydrogen development programmes, for example, to be accelerated at government level to activate economic activity and create jobs to help offset losses posed by the shift away from coal.

Seriti Resources CEO Mike Teke, meanwhile, acknowledges that the carbon emissions from burning fossil fuels have a huge impact on humanity.

“We are not climate denialists at all, we understand our responsibility as coal miners to mine coal responsibly to ensure that we drive zero harm and ensure we fulfil our obligations toward environment, social and governance aspects.

“With coal being a fossil fuel, we accept there are opportunities for us, as humanity, to look at driving a just energy transition, but in a responsible way. The Integrated Resource Plan envisions a coal reduction of more than 70% in terms of electricity generation as baseload. We cannot, therefore, as a miner ignore that.

“However, as we progress, it should be acknowledged that 13 coal-fired power stations cannot be shut down overnight.”

Teke adds that there are more options than simply closing down coal assets, including carbon capture and storage, which can be applied in many industries. He motivates that a transition to cleaner energy should not come at the expense of communities, their jobs and their livelihood.

From a global perspective, National Business Initiative CEO Joanne Yawitch notes that the push to achieve carbon neutrality by 2050 is real and that pressure in this regard is mounting.

Even China, which is a large coal user itself, recently decided to no longer finance any new coal projects globally, and the country is targeting carbon neutrality by 2060.

The issue of competitiveness is also coming to the fore, Yawitch mentions, explaining that South African exports have a high degree of embedded carbon, this while there are talks of border tax adjustments in relation to exports to assess embedded carbon and exercise trade tariffs accordingly.

“South Africa will certainly be impacted by global changes and the pressures are quite significant, which pose a number of key opportunities. We have 30 years to plan a coal phase-out; we can avoid the catastrophes se...