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Mining Weekly Editor Martin Creamer joins me today to unpack the Rietberg copper mine possibly becoming the cash cow of Copper 360; AngloGold Ashanti's interim dividend improvement and strong free cash flow; and Glencore's strong strategic achievements as it continues with the decline of its thermal coal operations.

Astron Energy, which has successfully rebranded one of South Africa's transport fuel forecourt networks, is described by Glencore CEO Gary Nagle as being a terrific asset.

With the restart to full production of the Astron Energy refinery in Milnerton, Cape Town, Astron Energy is supplying a sizeable quantity of South Africa's fuel and lubricant needs, including those of the mining industry.

"It's one of the very few operating crude oil refineries in South Africa where it's providing beneficiation, local job creation, and a local brand," Nagle highlighted during this week's Glencore media conference following the presentation of half-year results by the London- and Johannesburg-listed diversified mining and marketing company.

"A great management team runs Astron from Cape Town, refining margins are positive and it's a cash generative asset for Glencore," Nagle said in response to Mining Weekly's questions.

Most of the cash being generated is being reinvested into the business through various upgrades and initiatives of the plant, as well as the rebranding of the forecourts around South Africa.

Astron provides a key element for Glencore's food trading business, with the refinery a primary constituent.

Moreover, Astron's sector-specific expertise, particularly within the mining environment, allows the group to provide tailored solutions that address the specific needs of customers.

FERROCHROME AND DECARBONISATION

Production and supply of battery and alloying metals of primary and secondary origin, including the strongly South Africa-linked ferrochrome, were also highlighted.

"Ferrochrome is not your traditional decarbonisation metal or transition-enabling metal in that it's not used in batteries and the like. But where ferrochrome is absolutely important and critical for decarbonisation is in the production of stainless steel.

"To make stainless steel, you have to use ferrochrome. You cannot produce stainless steel without it. If you had no ferrochrome and you weren't producing stainless steel, your replacement cycle of everything that is stainless would be so much quicker, which means far more use of steelmaking coals, far more use of carbon-based reductions in producing pig iron and carbon steel, and the additional carbon added to the atmosphere would be significant," Nagle pointed out.

"The fact that we have ferrochrome in South Africa allows for a much slower replacement cycle. Longevity of stainless-steel products is a contributor in itself," he added.

Mining Weekly: Do you see demand lifting for ferrochrome in the medium to long term?

Nagle: We see strong demand for ferrochrome going forward.

RENEWABLE ENERGY ON WAY

On what has been accomplished so far by Glencore in adding renewables and low carbon electricity to its South African ferroalloys operations, Glencore Alloys CEO Japie Fullard reported that a start had been made on the building of a 25 MW renewables plant for Rhovan, the ferrovanadium operation situated about 30 km to the north-west of Brits, in North West province.

Execution of this solar project is probable within the next year and the company is also close to signing a power purchase agreement for 100 MW of solar power.

"We have in-principle approval for that and we're also pursuing other projects," Fullard reported.

Argentina is the next frontier for copper growth, "no question", Glencore CEO Gary Nagle highlighted on Wednesday when the London- and Johannesburg-listed diversified mining and marketing company outlined a growth pipeline that has the capacity to double the company's annual production to two-million tonnes of copper a year.

Low capital brownfield projects are the predominant assets within the portfolio, and these will be brought to market in a value accretive way, Nagle assured during the reporting of 33%-lower, $6.3-billion half-year earnings before interest, taxes, depreciation and arbitration (Ebitda) and 9% higher funds from operations. (Also watch attached Creamer Media video.)

Investment in copper is focused particularly on two Argentinian projects - MARA, located in Argentina's Catamarca province, and El Pachon, in the South American country's San Juan province, about 2 km from the Chilean border.

The brownfield MARA has the Alumbrera processing plant and associated infrastructure.

"We're calling out approximately $400-million between 2024 and 2026 particularly on MARA and El Pachon.

"Argentina looks like a very exciting jurisdiction to invest in. Our El Pachon greenfield project there is just enormous.

"We've had to stop our drilling programme, because the more we drill, the more we find and we don't need to find anymore," Nagle said during the presentation covered by Mining Weekly.

At the brownfield end is MARA. Being effectively an extension of the old operations that Glencore has in Argentina, low capital-intensity MARA is likely to be first to market.

"We can bring on up to another million tons of copper and we'll do so over time, as the market needs it," Nagle emphasised.

Regarding coal, he added: "Coal prices, particularly out of Newcastle, are looking very strong.

"The world continues to be hungry for energy as it decarbonises. It needs that high-quality coal, and we provide that."

Steelmaking coal is now a key part of the business. "It's certainly a transition-enabling commodity that's critical for decarbonisation infrastructure.

"It's supply-and-demand scenario looks very exciting, given the inability for major ramp-up in supply. It's a commodity that is not easily substituted or removed from requirements of steelmaking," Nagle highlighted.

Battery and other decarbonisation materials supplied by Glencore include South Africa-centred ferrochrome and vanadium, as well as zinc, nickel, lead, cobalt and manganese.

"These are key inputs into decarbonisation, key inputs into industrialisation. We've become a one-stop shop in supplying all the needs of our customers with respect to these commodities."

Glencore's recycling business is also charging on.

"We continue to produce all the critical minerals out of our recycling business. It's something that sets us apart from any other competitors, because we're able to provide those recycled materials.

"As we see the world continuing to progress, and we see a ramp-up in end-of-life batteries, particularly out of the battery electric vehicle industry, the recycling business is set to continue to grow," Nagle added.

The company, which describes itself as being very cash-generative, expects its second-half performance to be "very strong".

Gold mining company AngloGold Ashanti on Tuesday reported a soaring interim dividend improvement on strong free cash flow uplifted by the elevated gold price, operational improvement and cost reduction.

The first-half interim dividend was 450% higher and free cash flow reached the $206-million mark compared with the outflow of $205-million in the first half of 2023.

First-half earnings before interest, tax, depreciation and amortisation rose 65% to $1.118-billion from $676-million.

The Denver-headquartered AngloGold stated that it is continuing to take steps to improve company valuation through ongoing cost performance and cash conversion as well as increasing the life of its key mines and prioritising the successful project development.

"We expect to deliver an even stronger second-half performance," AngloGold CEO Alberto Calderon stated in a Johannesburg Stock Exchange news service announcement covered by Mining Weekly.

"We took decisive steps last year to restructure our business in Brazil after a sustained period of losses. That created the foundation for this step-change in operating performance, which we will look to improve further," Calderon added.

Total year-on-year cash costs an ounce were 1% lower and, influenced by the amid the improved second-half outlook, full-year guidance has been reaffirmed.

A former International Monetary Fund luminary, Calderon ascribed the improved results to "the hard work that's been done to improve the fundamentals of our business".

First-half gold production rose 2% to 1.25-million ounces from 1.23-million ounces in the same period a year earlier, and total cash costs per ounce fell 1% to $1 158/oz against the backdrop of AngloGold's realised first-half inflation rate of some 6% reflecting the sum of price-related increases in cost of goods and services at each site.

Group all-in sustaining costs (AISC) per ounce rose 2% to $1 589/oz compared with $1 555/oz in the same period of 2023.

Total cash costs per ounce for subsidiaries improved 1% to $1 200/oz and total cash costs per ounce for joint ventures improved 2% to $866/oz.

AISC per ounce for subsidiaries increased 2% to $1 658/oz and AISC per ounce for joint ventures by 2% to $1 078/oz.

Gold production from AngloGold's Americas' segment of Mineração (Cuiabá), Serra Grande and Cerro Vanguardia increased by 10% to 257 000 oz from 234 000 oz in the first half of 2023.

Total cash costs per ounce from the business unit improved 18% to $974/oz from $1 185/oz in the first half of last year.

AISC per ounce in the South American region improved 27% to $1 414/oz from $1 932/oz in the same period last year.

Moreover, this region recorded a strong turnaround in free cash flow, recording an inflow of $149-million from an outflow of $127-million in the same period last year.

SECOND QUARTER BOLSTERS PERFORMANCE

Gold production in the second quarter rose 12% to 663 000 oz from 591 000 oz in the first-quarter, with overall quarter-on-quarter gold production improvement following the recovery of Australian from first-quarter flooding.

Tropicana's second-quarter gold production in Australia improved quarter-on-quarter by 38%, and Sunrise Dam's by 14%.

At Siguiri in Guinea, where metallurgical recovery challenges hampered first-quarter performance, second quarter gold production was up 67% quarter-on-quarter.

Across the remainder of the portfolio, improved second-quarter gold production contributions were recorded at Kibali in the Democratic Republic of Congo, which was up 8%, at Iduapriem in Ghana, which was up 6%, at Cerro Vanguardia in Argentina, which was up 5%, and at Geita in Tanzania, which was up 1%.

At Obuasi in Ghana, second quarter gold production was 54 000 oz, with underground ore tonnes treated rising 7% as the mine ramped up open stope volumes.

HIGHER PRICE OF GOLD

Basic earnings in the first half of 2024 were higher than in the first half of 2023 mainly owing to more gold being sold, a higher average gold price received per ounce, lowe...

The revived Rietberg copper mine is on its way to becoming the cash cow of Copper 360, the Johannesburg Stock Exchange AltX company, which last week produced the first copper ore in the O'Kiep Copper District since 1983.

The underground mine is one of a dozen dormant copper mines spread across Copper 360's consolidated mining licence area of 19 000 ha.

Its reopening advances the company from producing copper plate to producing copper concentrate.

It is now on the way to producing 45 000 t a month at a copper grade of 1.6% copper, bringing to an end four decades of copper dormancy in the well-endowed district of South Africa's Northern Cape.

"We're transitioning from spending capital to now generating cash, becoming extremely cash positive, able to pay a dividend, and then fund our growth from internal cash flow," Copper 360 CEO Jan Nelson told Mining Weekly in a Zoom interview. (Also watch attached Creamer Media video.)

Eighty per cent of the company's revenue will be generated from copper concentrate significantly growing its cash margin.

"We've got the offtake agreements in place for all the ore that'll comes from Reitberg," said Nelson.

The ore is being processed at the Nama Copper Modular Floatation Plant, which was recently acquired from Mazule Resources, and in two months, Copper 360's second plant will treat Reitberg ore.

"This achievement is a credit to our executive and management and the grit and determination of the Namakwaland people that come from the communities in the area, and who form part of our Copper 360 team," he said.

Plant recoveries of 75% to 85% are being targeted during start-up with previous test work reporting recoveries of 92% are possible.

"We're slowly building up from about 12 000 t of production this month to about almost 46 000 t of production over the next three to four months, so Rietberg's now going to become our cash cow," Nelson enthused about the asset that has a measured and Indicated resource of 4 782 000 t at 1.27% copper, representing 60 800 t of copper metal.

Sampling from draw points underground yielded values of 6.08%, 1.89%, 1.54%, 3.11%, 2.39%, 5.64% and 1.88% from broken stocks previously mined on 605 level.

The mining licence are was one of many consolidated in 2008 by Copper 360 chairperson Shirley Hayes, who has been working for 16 years to get to this point.

Mining Weekly: To what extent does your first ore-mining activity move the needle forward for Copper 360?

Nelson: On our mining right, which covers 19 000 ha, we've got 12 historical mines like Reitberg, and 60 prospects, and Reitberg has now shown that the development that has been done for these mines historically can be used. The grades are there, the orebodies are there, and it shows that that acceleration of this district can now happen quickly. We've got the template. We've seen what we need to do at Reitberg, and we can roll out the same model at the rest of the complex. We've got a central processing facility, and then we've got a cluster mining model, where all these small mines will start producing together, so I think it will move the needle significantly, and it's going to get us to 80 000 t of copper production in three years' time.

From what Copper 360 has seen so far, where does the copper endowment of the Northern Cape rank when compared with copper endowments of South America, notably Chile, and Central Africa, notably the Democratic Republic of Congo?

I think we rank right at the top, and the reason for that is value. Obviously, if you look at Chile, they produce large volumes of copper, and we're not in that league. But what puts us at the top of that table is that we've got very high grade ores. We've got 3%, 4% and 5% copper-bearing material sitting on surface. We've got infrastructure. The mines have been pre-developed, and we're low cost. We've got a margin of over 55% For us, it's all about the margin, and I think it's the margin that puts us well ahead of any other district in the world. We'v...

Global mine production of 929 t of gold in the three months to the end of June was a record for a second quarter, a period of firm gold demand and record gold prices, the World Gold Council reported on Friday.

Global central banks recorded 12 t of net gold buying in June, which was done through the International Monetary Fund and other public data sources, the council reported in its weekly market wrap-up.

At the time of going to press, the $2 473.64/oz told price was helping to solidify bullion's status as a formidable asset within the current disruptive economic landscape.

The council reported a second quarter of record price highs, driven by continued central bank buying, strong over-the-counter (OTC) investment , and a later-in-the-quarter upturn in Western exchange traded fund (ETF) inflows.

Conversely, the high price environment took its toll on jewellery consumption.

Total global gold demand, including OTC investment, was 6% higher year-on-year at 1 258 t. the World Gold Council added in its Goldhub report.

The London Bullion Market Association (LBMA) second-quarter gold price averaged a record $2 338/oz in Q2 - 18% higher year-on-year and 13% higher quarter-on-quarter.

OTC investment of 329 t was a significant component of total second-quarter gold demand and, together with continued central bank buying, it helped to drive the price to a series of record highs during the quarter.

Total gold supply grew by 4% to 1 258 t. In addition to the 929 t mine production hitting the second-quarter top spot, recycling supply was the highest for a second quarter since 2012, responding to the rising gold price.

Regional investment trends continued to diverge. Robust Eastern demand for bars, coins and ETFs contrasted with a marked Western decline, amid Western ETF investment flows beginning to return in the third quarter to date.

The council's full year outlook for 2024 is one of revived Western investment flows balancing out weaker consumer demand and potentially slower central bank buying compared with 2023.

Central bank activity was, once again, led by emerging market central banks such as the Central Bank of Uzbekistan and the Reserve Bank of India, which both added 9 t to their gold reserves during the month. The Monetary Authority of Singapore was the largest seller of 12 t in June.

Although gross purchases and sales are lower compared with the same period last year, buying strength continues with emerging market banks the main driving force of both purchases and sales.

Mining Weekly Editor Martin Creamer discusses Pan African’s Mogale Tailings Retreatment project being ahead of schedule and below budget; the Initial output from Sylvania Platinum’s new tailings project also being on track for the first half of 2025; and why Merafe’s ferrochrome output was down 17%?

The capital-raising success that emerging copper and zinc mining company Orion Minerals achieved is kindling high hopes that smaller South African shareholders will be facilitated to play a greater role in providing funding for new mining development and concomitant job creation.

Johannesburg- and Sydney-listed Orion has succeeded in bringing Australian Stock Exchange-style shareholder participation to smaller South African shareholders - and steps are being taken now to encourage a lot more of the same on the Johannesburg Stock Exchange (JSE).

"We can't really say that we've failed to raise money from retail in South Africa because we haven't tried, and now here's someone who came along tried and got it right," Utshalo founder Paul Miller commented to Mining Weekly in a Zoom interview. (Also watch attached Creamer Media video.)

Interestingly, of the R44-million-plus raised by Orion, the bulk - R33-million - was from small-end South African shareholders keen to increase their investment in the timely copper and zinc mines being developed in the Northern Cape.

"The Orion Minerals process has taught me that ordinary South Africans do want to own shares directly," Miller said, in reference to direct ownership of shares by ordinary South Africans being a pale shadow of the massive ownership by about ten large-end South African financial institutions, which manage more than 90% of South Africa's savings.

"There's been a significant change to the advantages that the regulators have given to large funds and how they've discriminated against individual investors.

"It was amazing what response we got from the market when we went out there to link up, really, with existing Orion shareholders," Miller added.

Utshalo's efforts to reach those investors in a new digital way assisted and although the Orion offer closed on the 23rd of July, Utshalo still has investors coming in, signing up on its website, and effectively putting their hands up for future similar offers.

"But I think it's important that while we show progress, we still need to lobby and campaign for our market regulators to take the same kind of steps that have been taken in other dynamic markets like Canada, Australia and the UK, where individual investors are given the credit they deserve as an important participant in the smaller end of the stock exchange."

An increasing number of concerned South Africans believe that this is conceivably the main reason why there are fewer than 100 companies on the JSE, which has been on a downward trajectory for the last 15 years.

Last year was the worst year on record for new JSE listings and primary capital raisings, despite many viewing the critical minerals boom as an opportunity to raise money for copper, lithium and graphite companies.

Mining Weekly: Most people agree that it's economically important that South Africa's mineral endowment and the Johannesburg Stock Exchange must be rejoined at the hip to help to fund lagging mining growth and to create jobs that are urgently needed. What is in the way of this being achieved?

Miller: The penny has not dropped with the financial regulators, with the exception, possibly, of the South African Reserve Bank, that there's a problem if you over-concentrate the buy side in your stock exchange, and that for smaller companies, particularly those out of the top 100, they need a diversity of smaller investors, small institutions, hedge funds, individuals, participating in the market. That penny hasn't dropped.

What is the potential for companies needing capital investment to achieve the same success as Orion from mainly smaller South African shareholders?

We have to recognise that South Africa's had a long history of inclusion in the financial markets. There's a whole generation of investors who grew up investing in new mines, participating in capital raisings. Many of them are aging now. We've had about two decades where there hasn't been much activity on that front because there's been signif...

First production from the developing Thaba Joint Venture (JV) chrome and platinum group metals (PGMs) recovery project on the northern part of the western limb of South Africa's well-endowed Bushveld Complex is expected in the first half of next year, the London Aim-listed Sylvania Platinum stated on Wednesday.

"The project will transform us into a significant chrome producer as we continue our examination of other opportunities," Sylvania CEO Jaco Prinsloo highlighted in a fourth-quarter to June 30 report.

The JV is made up of PGMs producer Sylvania Platinum's wholly owned South African subsidiary Sylvania Metals and ChromTech Mining Company subsidiary Limberg Mining Company and will process chrome and PGM ores from historical tailings dumps and current arisings within the Limberg chrome mine area.

"I'm very pleased with the excellent progress," Prinsloo added in the media release to Mining Weekly.

On schedule are the design, procurement and construction elements of the project, which Prinsloo describes as respresenting the first stage of Sylvania's strategy to diversify its production and income streams.

The 18- to 24-month execution of the provisionally budgeted R600-millon project came out of its starting blocks in August last year.

Thaba JV is poised to advance Sylvania's current core business retreatment of PGM-bearing chrome tailings in the six-plant Sylvania Dump Operations (SDO) in that a combination of run-of-mine (RoM) and historical chrome tailings will be treated, which will create a full margin chromite concentrate-revenue stream.

The group also holds mining rights for PGM projects in the Bushveld Complex's northern limb, which take in the Volspruit, Aurora and Hacra projects. Results of the Volspruit project's scoping study are expected during August.

In the three months to June 30, SDO recorded $20.6-million net revenue and earnings before interest, taxes, depreciation and amortisation of $2.8-million.

Cash of $97.8-million was on hand at the end of the period and SDO's Doornbosch operation achieved 12 years lost-time injury-free days.

A half-year interim cash dividend amounting to $3.3-million was paid in April and a special dividend totalling the same amount was paid in June.

SDO's Mooinooi and Millsell operations have reportedly stabilised after February's mineworker strike and optimisation efforts continue to address lower PGM feed grades and recoveries associated with the blend of feed sources at selected operations.

The strike plus lower PGM feed grades and a decrease in associated metal recoveries related to the ore mix at some of eastern operations resulted in a lower-than-anticipated quarterly production and ultimate yearly production of 72 704 platinum, palladium, rhodium and gold (4E) ounces for the full 2024 financial year, which was below the target of between 74 000 and 75 000 4E PGM ounces for the year.

The capital expenditure incurred of R98.2-million is in line with planned capital project schedules.

Optimisation of ore blending remains a priority with continuing focus on improving equipment runtime, which has resulted in an increase of 2% in flotation plant throughput.

A feasibility study for a potential new treatment facility for chrome tailings and RoM ore sources at the eastern operations is in progress.

At Lesedi, Section 189A labour relations consultations are under way on the possible restructuring of the operation.

PGM PLANT PROGRESS

Civil works for the PGM plant are complete and steel erection has commenced. The first batch of float tanks have been installed and fabrication of the reagent plant is under way.

Orders for long-lead infrastructure have been placed and most of the electrical, control and instrument design work has been completed, with small power, lighting and the last of the non-critical instrument datasheets being undertaken.

Preparation works have started for the equipping of strategic boreholes and opencast pit dewatering and recovery to supply clean water to the pla...

Diversified mining and marketing company Glencore expects to be able to announce the decision of the board regarding the potential demerger of its coal and carbon steel materials business next week.

The London- and Johannesburg-listed company is currently in the process of consulting with shareholders to assess their views on a potential coal and carbon steel materials business demerger.

An announcement on this is expected alongside the presentation of interim results on August 7.

Last month, Glencore acquired the remaining 77% of Canadian mining company Teck Resources' shareholding in Elk Valley Resources (EVR) steelmaking coal business.

"Post the acquisition of EVR, we are now in the process of consulting with shareholders to assess their views regarding the potential demerger of our coal and carbon steel materials business.

"We expect to be able to announce the outcome of such engagement and the decision of the Board regarding the potential demerger alongside our interim results next week," Glencore CEO Gary Nagle stated in its half-year production release to Mining Weekly.

"Across the portfolio, our full-year 2024 production guidance has been maintained and we have added additional steelmaking coal volumes in H2 2024, following successful closing of the EVR acquisition.

"Our forward-looking production guidance has been adjusted to separate steelmaking and energy coal.

"As anticipated, 2024 is expected to be a year of two halves, whereby the tracking of our year-to-date production versus guidance is expected to be caught up during the second half of the year," added Nagle.

Coal production of 50.6 million tonnes was 7% lower, on mainly the progressive effect of scheduled mine closures, the temporary impact of longwall moves in Australia in 2024 and export rail constraints in South Africa.

South Africa's energy coal production of 7.9-million tonnes was 0.6-million tonnes (7%) lower than in the corresponding first-half period of last year, mainly reflecting various measures implemented to progressively reduce coal production owing to export rail capacity constraints.

"As and when additional rail capacity is restored, the potential exists to increase production rates," Glencore stated.

Second-half energy coal production uplift is expected to arise mainly from longwall changes, improved equipment availability and reduced strip ratios in Australia.

South Africa's ferrochrome production of 599 000 t in the first six months of this year was 16% lower than in the corresponding period of 2023 as the Rustenburg smelter remained idled in response to weak market conditions and pending an improved price/cost environment.

Higher second-half copper production is expected from African Copper in the Democratic Republic of Congo and Antapaccay in Peru and higher second-half zinc production is seen to be on the way from Kazzinc in Kazakhstan, where Zhairem is continuing to ramp up.

There will also likely be more nickel from Murrin Murrin in Australia.

Full-year steelmaking coal production guidance has been updated to 19-million tonnes to 21-million tonnes through the inclusion of 12-million tonnes of expected second-half EVR volumes.

In the first half, own sourced copper production of 462 600 t was 2% down on last year and the 15 900 t of cobalt 27% lower than the first half of 2023.

Own-sourced overall zinc production of 417 200 tonnes was 4% down and nickel production a 5% lower 44 200 t owing to Koniambo's care-and-maintenance transition in New Caledonia.

Glencore expects to report a reduction in net first-half working capital and net debt.