MiningWeekly.com Audio Articles

The rare earths recovery project, which is underway in South Africa's Limpopo province, is seen as one of the world's most resilient rare earth projects at a time when these elements are in widespread demand in permanent magnets to help the world go green.

"We believe this is one of the most resilient rare earth projects in the world. We ran a trial of reclaim on the phosphate gypsum in February this year very successfully, so we proved that we could reclaim it hydraulically," George Bennett, the CEO of the London-listed South Africa-led Rainbow Rare Earths, proclaimed at this week's Mintek@90 event, covered by Mining Weekly. (Also watch the attached Creamer Media video.)

Rainbow calculates that it has an economic grade of rare earths in the gypsum stacks at Phalaborwa, where the 25-million-tonne resource provides for 16 years of recovery of four of the world's most sought after rare earth elements.

Some 150 000 t of these rare earths will be produced at an operating expenditure (opex) believed to be the lowest of any projects in the West and even below that of the East.

"The fact that we could achieve such a low opex makes this project very resilient. At the moment, no rare earth projects in the world are making money at current rare earth pricing," he said.

But two months ago, even when the prices of the two key permanent magnet rare earth elements were at $47/kg to $48/kg, Rainbow would have been profitable had it been in production.

Prices have since recovered to about $60/kg for the two elements and in 2022 they were at $180/kg and all the forecasts are for rising rare earth prices

A large-scale pilot plant, which has been built as part of Rainbow's close collaboration with Mintek since 2022, operated at the high level of 20 kg per hour of feed, making it six to ten times the size of a normal pilot plant. This plant will be rerun in January/February just to prove final stage separation.

Involved is the first commercial recovery of rare earth elements from phosphogypsum in Phalaborwa and this is being pioneered by Rainbow Rare Earths.

The phosphogypsum is the result of the mining of a hard-rock phosphate deposit, which has been carried out by Foskor for the last 60 years.

The mined material is concentrated through a flotation process into a phosphate slurry, which over the period has been the feed for a nearby phosphoric acid plant, where two key ingredients were added, namely sulphuric acid and heat to create phosphoric acid.

The rare earths in the phosphate slurry were further upgraded in the phosphoric acid sludge in the phosphoric acid plant and then that phosphoric acid production created a gypsum waste residue that was transported in a concentrated form to the gypsum stacks.

The event was held to mark Mintek's nine decades of pioneering contributions in the minerals and metallurgy sector by South Africa's Council for Mineral Technology, which derives its mandate from the Minerals Technology Act.

In conjunction with Mintek, Rainbow has developed a one-of-a-kind flowsheet that enables the commercial extraction of key rare earths out of the phosphogypsum and go to the lengthiest of downstream value additions.

Displayed on a large screen was an old opencast mine that had been mined for many years, an old Sasol phosphoric acid plant that has not been operating for ten years and two unlined environmentally hazardous gypsum stacks.

"Rainbow's project's going to clean this all up into a very environmentally friendly state," Bennett promised.

The ready-fenced and power-lined site has a high-voltage switch yard, reflecting the considerable advantages of being on a brownfields location.

Mining Weekly Editor Martin Creamer discusses South Africa's impressively low battery manganese incentive price; Barrick’s third-quarter results, which showed that the African region delivered its usual reliable performance; and gold equities continuing to underperform the gold price.

People are sitting up and taking notice of South Africa being very much back on the investment radar screen, Southern Palladium executive chairperson Roger Baxter said on Thursday.

This follows the return of Baxter and Southern Palladium MD Johan Odendaal from a North American road show where they attended the JSE's South Africa Tomorrow Investment Conference in New York.

"We had a series of meetings in New York and then in Toronto and what's important is that people are sitting up and taking notice of the fact that South Africa is very much back on the investment radar screen, and that's because the Government of National Unity are implementing the reforms that have been agreed over the last couple of years.

"Not having loadshedding for seven months makes it a lot easier to sell South Africa, but also the fact is that we've seen a stabilisation in Transnet's performance, we've seen business and government working well together to resolve particular issues and, as the Reserve Bank Governor Lesetja Kganyago said, just solving the electricity crisis adds about two percentage points back onto the growth rate.

"So, over the next couple of years, South Africa should be growing at 3.5%, instead of growing at 1.2%. We've got more work to do as a country but that's a positive message coming back from our meetings," Baxter told Mining Weekly. (Also watch attached Creamer Media video.)

Meanwhile, the Sydney- and Johannesburg-listed platinum group metals (PGMs) development company Southern Palladium is upbeat about the completion of its very positive prefeasibility study (PFS) on the Bengwenyama PGM project, which is located on the eastern limb of South Africa's well-endowed Bushveld Complex, which Baxter describes as prime PGM mining real estate.

Speaking from Perth, the former Minerals Council South Africa CEO said: "I'm very glad to be involved in this project. I wanted to come back and really give something back to South Africa and to the industry, and I think this project is it."

Of the $19-million that Southern Palladium raised on the ASX in June 2022, just under $15-million has been spent on exploration, which has proved up a 40-million-ounce resource and a six-million-ounce reserve in the 70%-owned Bengwenyama project, which accesses the orebody at a shallow level of 50 m.

"It's close to surface, it's low cost, it's Tier 1, and we've got a fantastic community who are fully supportive of the project, and we're working well together towards bringing this whole project to fruition.

"It's been interesting being out there in the investment marketplace not only marketing the project, but also looking at what people are thinking about South Africa.

"We have fantastic support of our Bengwenyama community partners, and they have a big equity stake in the business.

"We've got a very experienced management team, excellent board of directors, and we're focused on making sure that this is going to be a flagship project development, demonstrating that South Africa is investable in the mining space and bringing on stream a world-class mining operation.

"We're looking at a 2.4-million-tonne-a-year production profile, 400 000 oz of PGMS, that's 6E PGMs, of which we're going to be producing about 150 000 oz/y of platinum, which, in perspective, is just over a third of Zimbabwe's entire platinum production, just using it as a country level example.

"So, it'll certainly be creating a lot of value. It has about a billion US dollar post-tax NPV, which is nicely scalable to higher prices, with a nice 28% internal rate of return criterion, which escalates with higher prices. It is very much in the lowest-cost quartile, with an all-in sustaining cost of $800/oz.

"We certainly think this is a great opportunity. We're working hard with our partners to bring it to fruition, and we're looking forward to being able to report back our progress as we go forward," Baxter enthused.

The project was drilled out within two years and is targeting upper group two (...

How South Africa can grow its participation in the global battery supply chain was spelt out this week at the Mintek@90 event to mark nine decades of mineral and metallurgical research, development and technology transfer by South Africa's Council for Mineral Technology, which derives its mandate from the Minerals Technology Act.

Telling it as it is in practical, proven and put-your-money-where-your-mouth-is detail was mining luminary Bernard Swanepoel, who addressed the audience in his capacity as chairperson of Manganese Metal Company (MMC) of Mpumalanga, where a self-funded R150-million project execution of the initial smaller manganese metal-to-sulphate plant began in September, with orders already placed for the long-lead crystalliser plant.

But to put South Africa where it needs to be, MMC's initial super-fast entry must be followed by a far larger plant - and that will require institutional funding, Swanepoel emphasised at the event covered by Mining Weekly. (Also watch attached Creamer Media video.)

Target markets of this initial moderately sized plant, with a capacity to convert 2 000 t of MMC's pure manganese metal into 6 000 t of high-purity manganese sulphate monohydrate with the help of renewable energy, are Europe and North America, mainly because MMC is already in Asia.

The plant will be commissioned in the first quarter of 2026, when the clock will start ticking on accreditation to open the way for shipments of ongoing sales from the start of 2027.

This comes amid manganese bringing many benefits to nickel- cobalt-manganese battery cell makers, through reducing nickel content and increasing manganese content, which enables the cell to be operated at a higher voltage and battery electric vehicles to be more price competitive.

Expertise remains the key barrier to entry in the supply of refined high-purity material, other than at the handful of incumbents being South Africa's MMC, Vibrantz Technologies of Belgium and Nippon Denko of Japan.

Other projects, such as Element 25 and South32's Hermosa project, both recipients of US Department of Energy grants, still have a long timeline ahead of them as large, standalone facilities born out of greenfield projects requiring new permits.

One of the benefits of adding brownfield capacity, such as MMC and Vibrantz are doing, is that capacity can be added in step with market demand.

Unmatched is MMC's years of being the world's premium pure manganese producer.

"I've only been involved since 2010 so my contribution is but the last chapter of MMC," he said as he proceeded to outline what is a spectacular South African example of value creation through beneficiation.

Swanepoel made three key points to the audience, which included Mining Weekly. The first was that the purity requirement for battery-grade manganese is sky high.

The second was that capital allocation will be required to make battery-grade manganese so abundantly available that the OEM producers can build their future technologies under assumption and the guarantee that it will be available.

The third was that the strategic advantage for South Africa, which has already scaled the high technical hurdle, is colossal.

No new mines are needed for battery growth, manganese ore fines are an ideal source of feed and the refining of ore into high-purity manganese compounds will be the only viable projects.

What is stunning is that South Africa has all the required ingredients and MMC, as a one-of-a-kind refiner of high purity manganese, is ready to grow massively.

Required is institutional developmental support from Mintek, the Industrial Development Corporation (IDC), universities - the University of Limpopo is already making a significant contribution, affordable renewable electricity and collaboration with the battery value chain, the Coega Industrial Zone, Northern Cape, and other ingredients also made in South Africa.

"We do need institutional development support. This business was funded 50 years ago by the IDC. T...

Why is it that gold equities are continuing to underperform the gold price? That is a question Mining Weekly put to Barrick president and CEO Dr Mark Bristow after he noted the lag of gold equities during the presentation of the third-quarter results of his New York- and Toronto-listed gold and copper mining company.

The gold equity underperformance comes amid demand for physical gold putting upward pressure on the gold price as de-dollarisation within the central bank reserve balances takes place.

"So, you're effectively seeing a switching of dollars for gold in the central banks, particularly the emerging market central banks," Bristow outlined in an interview with Mining Weekly.

The two biggest owners of treasury bonds are China and Japan. Then, again, even retail physical gold sales at Costco have been evident. Interestingly, the Western world playing in the gold space was not that apparent until two months ago.

"Over the last two months we've seen an increased inflow of ETF gold, and that's Western investors investing in gold. When you look at it, one can interpret that investment in physical gold is the ultimate hedge against risk.

"As the gold price has moved up, one would expect that there would be more and more interest in gearing that gold movement, and the best way to do that is with equities. But at the same time, there's been a redemption within most of the gold specialist funds, as people take profits, and people are trying to position themselves, I guess, for the next phase in investment opportunities. It sounds contrary, but we were a bunch of investors and there's a logic to the fact that at a high gold price, you start seeing people taking their money out of gold funds.

"So, it's a complex situation. It's people wrestling with risk and to complicate it, you've seen the equities reach. You know, more and more eyes, although the gold price itself has outperformed the S&P, and I think the gold industry and the mining industry in general is at a place where there's a shortage of optionality. The mining industry, apart from Barrick, hasn't invested in exploration, which brings optionality into the stock.

"That's the traditional driver of premiums in the gold industry, we haven't seen that. What we've seen rather is fund managers and investors demanding short-term gratification, instant gratification, from equity, and as you know, the mining business is a long game with long-term capital. So, it's a complicated situation, and, and that's what I'm managing in Barrick. I've always created value over the long term. It's my drivers. It's the very foundation of our Randgold DNA, which is now Barrick's DNA and that doesn't always fit neatly with short-termism.

"Physical gold investment is a long-term hedge against global risk. But everyone has become very short term on equity, and that's driving most of the equities. But gold has not performed as well as some of the other equities, and that's where the generalists are right now. They're in IT stocks and the big global innovation stocks that makes sense," Bristow pointed out

What is Barrick planning to do to increase gold equity demand, or increase demand for Barrick equity?

We don't need to raise money in the market. We're effectively independent of the market and so what we need is patient, long-term investors and we needed to build that delivery, and, again, we're making very good progress. You would have seen that our net earnings were up 33%, cash flow up 27%. We bought back some more stock because we don't believe that we're optimally priced and we also reduced debt. We want a strong balance sheet so that we can remain independent given our big growth projects that we will start building next year. There were many years that we built that value foundation in Randgold before the market recognised the real value that Randgold brought in, and we're building that in Barrick. Already, if you look at our business, we're pointing to 30% organic growth. We don't need oth...

While Zimbabwe has taken steps to ban chrome-ore exports in favour of beneficiation, vast ore volumes are leaving South Africa without being beneficiated, says African Rainbow Minerals (ARM) technology executive Henk Bouwer.

"The South African ferroalloy industry has entered the final stages of dying," he said as he addressed the Chromium 2024 conference in Cape Town this week.

"The once dominant South African ferrochrome and manganese alloy industry is at risk of vanishing, and the beneficiation of chrome and manganese ores in South Africa could stop."

Bouwer noted that there was a perception that investing in beneficiation in South Africa was not feasible, owing to a number of challenges, including high energy costs and insufficient and unreliable electricity supply.

"So, no investments are planned for South Africa. Some ferrochrome smelters have already closed, and the remaining smelters are trying to survive through electricity price agreements."

This was the state of industry, he added - while South Africa had 70% of the world's chrome reserves.

The world churned out 39.66-million tons of chromite ore last year, with South Africa producing 25.85-million tons of this number, and exporting 17.88-million tons.

The remaining chromite ore was processed locally to produce 3.2-million tons of ferrochrome, with less than 100 000 t consumed in South Africa a year.

Ferrochrome is a ferroalloy which includes iron and chromium, and is used to produce stainless steel.

South Africa used to be a major global alloy supplier.

Bouwer was positive that the fortunes of South Africa's ailing ferroalloy industry could be turned around by, for example, rolling out ARM's new SmeltDirect smelting technology.

This new "groundbreaking technology" enabled conventional chrome smelters to produce three times more product using the same amount of electricity, he explained.

"Comparing it to conventional technology, it is 350% more efficient, and it requires 70% less electricity. It delivers 28% higher chrome recovery and produces 35% less carbon emissions."

Bouwer noted that SmeltDirect had already been fully developed, with all the necessary feasibility studies completed.

The project to roll out the technology is awaiting funding, with joint ventures being explored.

Bouwer believes that South Africa could potentially produce green alloys with this technology, while also exporting ferrochrome and stainless steel to China, rather than ore.

"Producing the alloy in South Africa, rather than exporting ore, will create a substantial number of jobs, while it will also help to alleviate the major logistics issues created in exporting vast amounts of ore, especially by road."

SmeltDirect is also, for example, able to unlock the potential of South Africa's vast carbonate manganese ore resources, which are considered less desirable when considering conventional smelting technology.

Bouwer said South Africa would be forced to mine these ores as high-grade ores became depleted.

"One-hundred per cent of these carbonate ores can be smelted efficiently with SmeltDirect, which is not possible with conventional technology."

SmeltDirect could also unlock low-value and currently unsellable manganese and iron-ores.

It is also possible to convert mothballed and conventional smelters to implement SmeltDirect.

"The South African government and industry need to urgently find a sustainable solution to save South Africa's ferroalloy beneficiation industry and to enable it to reach its potential," said Bouwer.

"The big question is if we will see beneficiation through alloy production die, or if we will take action to realise our potential."

Mining Weekly Editor Martin Creamer discusses the appeal of platinum as an investment asset for Chinese investors; DRDGOLD’s Ergo solar plant receiving an Eskom grid connection certificate; and former Sasol, Royal Bafokeng Platinum CFO now leading a Madagascar graphite advance.

South Africa's mining industry will "certainly push back strongly" against Eskom's proposed tariff hikes, says Minerals Council South Africa (MCSA) chief economist Hugo Pienaar.

If granted, Eskom's tariff-hike application at the National Energy Regulator of South Africa (Nersa) for the 2025/26 financial year will see direct Eskom customers pay 36.15% more on April 1 next year, with the price at municipal level increasing by 43.55% from July 1.

From 2012 to 2025, Eskom has, on average, applied for a 19.62% increase, but has been granted 10.79% from Nersa - this while average headline CPI has been 5.2%.

"Given the history and averages granted, Eskom is very unlikely to get the 36%," noted Pienaar as he addressed the Chromium 2024 conference in Cape Town.

"But they could get 20%, and even that will be a further blow to more beneficiated products - typically the more energy-intensive products.

"Now bear in mind that there is a big contradiction here. We are increasingly hearing from government that they want to push beneficiation in South Africa.

"However, these processes are, to a large extent, energy extensive, and would require competitive electricity costs, and [Eskom's application] will certainly not do that."

While there had been a number of positive developments under South Africa's new Government of National Unity, high electricity prices remained a key constraint on mining and the general economy, warned Pienaar.

He added that the MCSA was keeping its eye on another potential risk - how government was planning to execute its plans to boost beneficiation.

"Will it be a carrot or stick approach? We would favour the carrot approach, where government puts in place incentive structures to make it more profitable to beneficiate, as opposed to export controls and the like."

Pienaar highlighted that chrome production was one of the stars in South Africa's mining industry.

Over the last 30 years, since 1994, on average, mining production had shrunk by roughly 0.5% in South Africa.

"It is the only sector in South Africa that has declined over such a prolonged period."

However, chrome ore production has seen a sixfold increase in output over the last 30 years.

"On average, in real terms, that sector is growing by 8%," said Pienaar.

"It has been one of the fastest-growing, if not the fastest growing, subsectors of mining in South Africa - a success story."

Ferrochrome production and exports have not, however, mirrored this success, with South Africa ceding its dominance of this beneficiated chrome product to China.

Ferrochrome is a ferroalloy which includes iron and chromium.

South Africa now only retains its dominance in chrome ore.

Eighty-two per cent of all chrome ore exports in the world in 2023 came from South Africa, and 92% of all chrome ore exports in 2023 went to China.

Following gold miners Gold Fields and AngloGold Ashanti's announcement last year that they intend to enter into a joint venture (JV) in Ghana, the companies have advised of not yet having received the approvals required by the government, despite constructive engagement.

The parties in March 2023 agreed on key terms for a proposed JV between Gold Fields' Tarkwa mine and AngloGold's Iduapriem mine, including to combine the two neighbouring mines into one single managed entity to extend the life-of-mine, increase production and lower costs.

In the absence of requisite approvals from the Ghana government and the clear timelines for execution of the agreement, the companies have announced they will maintain engagement in relation to a potential asset combination while separately continuing to pursue improvements to their respective assets.

The parties will keep shareholders updated on any significant developments related to the proposed JV.

AngloGold is also in the process of acquiring Egypt-focused mining company Centamin, with shareholders having approved the transaction in October. The takeover is expected to be completed towards the end of November, which will add the world-class Sukari mine to AngloGold's portfolio.

Meanwhile, AngloGold reported its strongest gold production quarter of the year from managed operations in the three months ended September 30.

The group produced 657 000 oz of gold in the quarter, compared with output of 676 000 oz in the same quarter of last year, owing to lower grades from the Kibali JV with Barrick Gold Corp.

Lower grades resulted in the production of 71 000 oz at the operation compared with 99 000 oz in the prior corresponding quarter.

AngloGold's output for managed operations increased by 2% year-on-year in the quarter under review to 586 000 oz, from 577 000 oz in the prior comparable quarter.

The company says gold production was particularly stronger at the Obuasi, Siguiri, Tropicana, Cerro Vanguardia and Sunrise Dam mines.

The group's mines are based in Ghana, Guinea, Tanzania, Brazil, Argentina and Australia.

The Obuasi mine recorded a 15% year-on-year increase in output in the quarter as total grades and underground tonnages rose despite impacts to production owing to reduced mining flexibility in Block 8 and difficult ground conditions in higher grade slopes.

Moreover, the group's Australian portfolio recovered well from rains and flooding in the first quarter of the year, while the operational turnaround being undertaken at its Brazilian operations continued to gain momentum with AngloGold having resumed processing of gold concentrate at the Queiroz plant in September.

The group posted an overall 339% increase in adjusted earnings before interest, taxes, deprecation and amortisation in the reporting quarter to $746-million, compared with adjusted Ebitda of $170-million in the prior comparable quarter.

AngloGold also generated free cash flow of $347-million in the quarter under review, from $20-million of free cash flow generation in the same quarter last year - marking a 17-fold increase.

"Tight control of costs and active management of our working capital means that that higher gold price has flowed through to our bottom line. We are looking for additional improvements to production and margins to ensure we deliver an even stronger fourth quarter and continue to capitalise on this healthy gold price environment," says CEO Alberto Calderon.

Headline earnings of $236-million, or $0.56 apiece, in the third quarter compare with a headline loss of $194-million, or $0.46 apiece, posted in the prior comparable quarter.

The average gold price received per ounce for the group increased by 28% year-on-year to $2 449/oz during the reporting quarter, from $1 908/oz in the prior corresponding quarter.

"A solid overall performance from AngloGold Ashanti's managed operations helped the company deliver a strong cash cost performance despite persistently high inflation across several of its operat...

The large solar electricity plant at DRDGOLD's Ergo gold tailings retreatment operation has received a formal grid connection certificate from Eskom, Ergo reported ahead of flying journalists over the operation's expansive array of solar panels and batteries, which provide a collective 187 MW of installed capacity.

"We run the plant off the batteries whilst being fully grid connected the whole time," Ergo COO Jaco Schoeman explained as we helicoptered over 133 000 solar panels and 43 batteries that make up the R2.8-billion in-house, on-balance-sheet Tshedza solar farm - Tshedza being Venda for 'let there be light'. (See attached Creamer Media pictures).

It is estimated that the Tshedza circuit will reduce group CO2 emissions by 52%.

The grid connection enables the operation to offset excess power generated against Ergo's other power accounts, journalists heard after being seen off at Rand Airport by DRDGOLD CEO Niël Pretorius and accompanied on the helicopter by Ergo MD Henry Gouws and Schoeman.

A constant feed of stable power into the circuit is crucial. If the Ergo plant loses power for three minutes, operation will cease for four to five hours, owing to the constant flow of gold-bearing slurry coming into it from as far afield as Soccer City, which is some 50 km away.

"Hence the batteries," it was explained to Mining Weekly as the overhead flight also provided views of pylons, overhead transmission lines and substations that have been constructed by DRDGOLD as part of the overall power circuit, which was designed and built by Enerj.

The battery and solar circuit allows the plant to run from six o'clock in the morning to nine o'clock at night, which provides the operation with additional daytime solar power to go back into the grid.

At night, it is possible for power to also be evacuated back into the grid from the battery, and in that way sweat the asset, which is not currently planned.

"But if we need to, we're in a position to do so," was Schoeman's comment on potentially getting additional return out of the structure.

"In total, we've got about 29 various Eskom and municipal accounts at Ergo and we're offsetting the power that we push back into the grid against all our other accounts.

"So, we're not selling power to third parties. It's all in-house consumed, but it's offset against other accounts, and for that, it was important for us to get a formal grid connection certificate, which we received last week. You need to be able to wheel energy and that's what we've got in the circuit," said Schoeman.

Installed capacity provides three hours of peak discharge and a two-hour backup for ramp-down, if required.

"The expansion of our Far West Gold Recoveries operations will add energy consumption, so we're looking at alternative solar projects to reduce that back down as far as possible," Schoeman added.

The back-end of Tshedza's bifacial panels provide 18% additional electricity from ground-up reflection.

They also track the sun and have the highest current hail resistance rating. Every barcoded panel has stated output capacity and switch-on date.

"We've got back-to-back agreements with the original equipment manufacturers so you've got to make sure that you stay within that window of operation to ensure that your warranties and guarantees are in place."

Interestingly, members of the same team that designed and built the plant have now been upskilled to operate and manage it as well.

More than 250 local community members were employed to do panel installation and cable laying.

Visible from the air was the maintenance warehouse, which is part of a R15-million outsourced social community contract that places strong emphasis on health and safety.

Established is a company called Carbon Works, which is 100% focused on the operation and maintenance of the Ergo power plant and which forms part of Ergo's management team.

TAILINGS DAM CONSOLIDATION

The Ergo plant has a nameplate capacity of about 2.2-million tons a month. When Anglo...