Momentum is building in the hydrogen economy, which is important for the planet and for platinum group metals (PGMs), Anglo American Platinum FD Craig Miller said on Monday.

"There have been over 1 000 hydrogen project proposals announced globally for full or partial deployment by 2030," Miller highlighted.

He spoke of direct investments of 10% of the $320-billion made into hydrogen project passing the final investment decision stages during the half-year results presentation of the Johannesburg Stock Exchange-listed company that has kept 2023 production guidance unchanged at between 3.6-million to 4-million PGM ounces, subject to the impact of Eskom load curtailment. (Also watch attached Creamer Media video.)

"I know we've spoken a lot about hydrogen over the years and you're probably wondering why. After all, the hydrogen sector is currently a very small proportion of total PGM demand. Put simply, we've spoken about it a lot over the years because hydrogen matters. It matters for our planet but it matters for PGMs," Miller stated in the half-year dividend-yielding presentation covered by Mining Weekly.

Miller drew attention to prominence being gained by the PGM-using proton electron membrane (PEM) electrolysers that produce the green hydrogen that protects the planet from deleterious carbon emissions.

"We all know the potential for PGMs from PEM electrolysers to make green hydrogen and PEM fuel cells to convert hydrogen into electricity," he said, displaying a slide which illustrated that PGMs are used, or have the potential to be used, in a whole host hydrogen applications from production and conversion through transportation and storage to end-use, with end-uses that included green chemicals, gas turbines, synthetic fuels, purification, sensing and emissions abatement.

"We're certainly seeing the momentum build in the hydrogen economy," he added.

"We, as Anglo Platinum, continue to invest in the development of a diverse range of existing and new opportunity for our metals.

"Our opportunity areas tap into key global trends such as decarbonisation of difficult-to-abate industries and mobility.

"For example, in Germany, H2 Moves Berlin, our fuel cell electric vehicle partnership with Toyota Germany, and the SafeDriver Group, now has more than 100 Toyota Mirai deployed as taxis on the streets of the German capital.

"Initiatives like these are helping the uptake of fuel cell electric vehicles by aligning end-use demand with the supply of vehicles and infrastructure access, made by influencing new audiences by proactive marketing and education activities," Miller said.

FUEL CELL ELECTRIC VEHICLES

For PGMs to hold on to their current volume of sales into the automotive market, they need to gain a tenth of the electric vehicle market, which will create demand for five-million to six-million ounces of incremental platinum group metals (PGMs) a year,

We're certainly seeing the momentum build in the hydrogen economy. There have been over 1 000 hydrogen project proposals announced globally for full or partial deployment by 2030.

Direct investments of $320-billion have made into hydrogen project announced through to 2030, of which 10% have passed the final investment decision stages.

We, as Anglo Platinum, continue to invest in the development of a diverse range of existing and new opportunity for our metals.

Our opportunity areas tap into key global trends such as decarbonization of difficult-to-abate industries and mobility.

For example, in Germany our H2 Moves Berlin, our fuel cell electric vehicle partnership with Toyota Germany, and the SafeDriver, now has more than 100 Toyota Mirai deployed as taxis on the streets of the German capital, while also stimulating the demand for a network of hydrogen refuelling stations.

Initiatives like these are helping the uptake of fuel cell electric vehicles by aligning end-use demand with the supply of vehicles and infrastructure access, made by influencing new audiences by proactive marketin...

Platinum group metals (PGM) mining and marketing company Anglo American Platinum on Monday declared an interim dividend after achieving results in line with changed guidance.

An interim dividend of R3.1-billion for the first half of 2023, in line with the company's dividend policy of a 40% payout of headline earnings.

On half-year capital expenditure (capex), Anglo Platinum FD Craig Miller said in response to Mining Weekly that about R4,5-billion was on stay-in-business capital and R1-billion on growth capex, the growth capex being predominantly linked to the future of the Mogalakwena mine, where exploration decline work is being undertaken as well as progressing studies associated with the future of Mogalakwena work.

"We've also spent and we continue to spend on the Mototolo/De Brochen life extension project. That's continuing the life of Mototolo and we're looking at spending around R3-billion this year on that particular investment," Miller added.

Owing to maintenance days being aligned with local curtailment days, the Johannesburg Stock Exchange-listed company reported that its mining operations manged to stave off being impacted by 42 days of first-half load curtailment .

On initiatives and working groups within South Africa's National Energy Crisis Committee (NECOM) to focus on the expedited implementation of the Presidential Energy Action Plan, outgoing CEO Natascha Viljoen said in response to Mining Weekly that Anglo Platinum had done "quite a bit" in that partnering process with NECOM to support Eskom, "and it's a partnership not a support, I think that's really important".

"From that point of view, we feel quite encouraged on the opportunities for us. As South Africans, we're all keen to make an impact and to help in those areas, and that is encouraging," Viljoen added.

Half-year earnings before interest tax depreciation and amortisation (Ebitda) were 69% lower year-on-year at R13.4-billion on lower prices, lower sales volumes, and higher costs, but the mining Ebitda margin generated was a solid 42%.

The Johannesburg Stock Exchange-listed company's balance sheet remains strong, with net cash of R23.9-billion.

Total PGM production decreased by 7% to 1 844 300 PGM ounces and refined PGM production decreased by 13% to 1 699 800 PGM ounces.

PGM sales volumes decreased by 12% to 1 807 300 PGM ounces, in line with lower refined production, and PGM trading volumes increased by 214% to 2 065 200 PGM ounces, in line with the strategy for greater participation in the market.

Guidance for the year remains unchanged, with between 3.6-million to 4-million PGM ounces, subject to the impact of Eskom load curtailment. Unit cost guidance for 2023 remains between R16 800 and R17 800 per PGM ounce and is expected to be at the upper range of guidance. In 2023, total capital expenditure is expected to remain within the market guidance of R22-billion.

In terms of market outlook, platinum is expected to remain in deficit over the next few years, as automotive demand gains from ongoing substitution of palladium in gasoline catalysts. Palladium is expected to move into surplus for the opposite reason, though to what extent will depend on what happens to automotive production and battery electric vehicles' share of it. Rhodium will remain in a small surplus, assuming further disposals from the fibreglass industry.

Emissions legislation around the world, the growing hydrogen economy and demand for PGMs in industrial applications should see global demand grow in future. Invest in assets and market development efforts are described as being well-positioned to take advantage of future demand.

PRICES WEAK

PGM prices were mostly weak in the first half of 2023, as an uncertain macro-economic backdrop was overlaid with metals-specific negative factors. The PGM average realised basket price was $1 885/oz, 29% lower than in the same period of 2022. This weak performance was due to sizeable declines seen in rhodium and palladium, taking both to multi...

Integrated procurement and project management needs to be actively adopted by South Africa's private and public sectors to ensure optimal return on investment, job creation, skills development, and improved service delivery, ECS Associates said on Friday in announcing its agreement with Anglo American Platinum to provide project management support to assist the platinum group metals mining company with the delivery of its extensive capital project pipeline.

The agreement allows for staged implementation through a gated process from concept to execution and close-out.

ECS has been tasked with deploying its Collaborative Project Strategies© - based on lessons learned from variety of projects in South Africa and around the world - in an integrated manner with Anglo Platinum.

In business since 1993, ECS provides consulting services to the engineering and construction industry, with its service offering focused on strategic advice, dispute resolution and training on the new engineering contract (NEC) platform.

The collaborative approach is described as heralding a new integrated procurement and project management approach to assure predictable project outcomes.

To deliver a successful end product, each project must be strategically aligned, properly planned, optimally staffed, correctly budgeted and have a measurable baseline agreed before work begins.

"Once a project commences underpinned with the right culture of all involved, tight control of scope, quality and costs must be central to the project, with regular, objective and accurate reporting against the baseline," ECS stated in a release to Engineering News & Mining Weekly.

The company expressed the view that South Africa has the opportunity to learn from the ineffective recent project delivery outcomes in weighing out collaborative models and that this can be done while training many people in new skills and uplifting local communities.

Collaborative Project Strategies© developed by ECS and underpinned by NEC is said to provide for effective procurement framework options and project implementation models, with better and more predictable project outcomes creating tangible benefits for all stakeholders.

"Investing in a collaborative approach early in the process of procurement and project implementation can save time and reduce potential risks later in the project, which may otherwise result in considerable negative consequences," said ECS MD Mile Sofijanic.

"Applying collaborative principles, such as relationship management, proactive communications, aligned business objectives, information and knowledge sharing, and value creation help to enable early development of this collaborative environment, prior to commencing formal project implementation. Doing so sets the tone for a more aligned and proactive working approach for predictable and successful contract delivery," Sofijanic added.

Collaborative Project Strategies© coupled with bespoke Agile Project Delivery solutions aim to assist in the delivery of optimum project outcomes and the unlocking of on-going value-adding initiatives.

Mining Weekly Editor Martin Creamer discusses Impala Platinum’s intention to develop a 100 MW-plus solar energy plant in North West province; South Africa's opportunity to recover gold from its mine dump material; and securing future demand for SA's platinum group metals.

Diversified mining and marketing company Glencore expects this year's marketing earnings to exceed the top end of its guidance range, prompting a buy reiteration.

The London- and Johannesburg-listed producer and marketer of more than 60 commodities, said on Friday that it expected adjusted marketing earnings before interest and tax to be in the $3.5-billion to $4-billion range, well above its $2.2-billion to $3.2-billion long-term guidance range.

"Glencore continues to be one of our preferred miners," UK metals and mining analyst Jefferies stated in its 'buy' note.

Copper, coal and zinc assets performed in line with expectations and previously communicated guidance, and first-half output was described as being solid.

"Second half volume weightings in copper, zinc and nickel reflect higher expected production volumes from Collahuasi, Kazzinc, Mount Isa and INO," Glencore CEO Gary Nagle stated in a release to Mining Weekly.

Glencore is due to report overall first-half results on August 8 amid its marketing segment largely normalising. While this will impact profitability, it has allowed for the release of some of the investment made in marketing working capital in 2022.

Regarding own-sourced production, only cobalt and gold production were up in the six months to the end of June, with 488 000 t of copper production 4% down on the corresponding six months of 2022. Copper sales volumes were 11 000 t lower on shipment timing.

Zinc production of 434 700 t was 10% lower reflecting mainly the 2022 disposals of South American zinc operations and the closure of Matagami.

Nickel production of 46 400 t was 20% lower, primarily reflecting higher third-party production, in large part necessitated by last year's strike at Raglan mine in Canada.

Attributable ferrochrome production of 717 000 t was 9% down on planned additional smelter offline days and coal production of 54.2-million tonnes was 2% lower than in the first half of last year.

Cobalt production of 21 700 t was 5% higher on improved recoveries at the Katanga copper mine in the Democratic Republic of Congo and gold output was up 10% at 369 000 oz.

Jefferies noted that Glencore, which has been active in deals as a buyer and a seller this year, has gone quiet on its bid to merge with Teck Resources and its alternative proposal to acquire Teck's coal assets and then subsequently demerge the combined company's coal business through a listing on the New York Stock Exchange.

"We would not consider this lull to be an indication of lack of interest. We expect an update from management when the company reports half-year results," Jefferies stated.

South Africa dare not fail in securing future demand for its 'incredible' platinum group metals (PGM) endowment, the Hydrogen Economy Discussion heard on Wednesday.

Anglo American Platinum projects and environment executive head Prakashim Moodliar outlined the widespread marketing effort under way to boost PGM demand as well as the hugely positive benefit of adoption of the hydrogen economy.

Moodliar, a keynote presenter along with German Embassy deputy head of mission Enrico Brandt, revealed the considerable work under way to map South Africa's Hydrogen Valley further, while Brandt provided insight into the momentous acceptance of hydrogen in Germany. (Also watch attached Creamer Media video.)

Moreover, Moodliar outlined how the building of the hydrogen economy in South Africa would enable significant job creation, reduce carbon emissions, support social change and drive economic development.

Currently, the bulk of platinum group metals are used in catalytic converters to reduce emissions from internal combustion engines and the shift to battery electric vehicles therefore poses a risk to South Africa's PGMs industry, which employs 172 000 people, making it one of this country's largest private sector employers.

"Considering that every employed person supports an average of ten other people, we dare not fail in securing future demand for this incredible natural endowment.

"The significant growth forecasts for the hydrogen economy will offer significant demand opportunities for metals, including aluminium, copper, iridium, nickel, platinum, palladium, and zinc to support these hydrogen technologies.

"This would include metal for renewable electrical technologies, and the electrolysis for renewable hydrogen, carbon storage for low carbon, nitrogen, or fuel cells using hydrogen for power transport.

"We know that reaching the goals of the Paris agreement to keep the global temperature rise to well below two degrees would mean a quadrupling of mineral requirements for clean energy technologies by 2040," said Moodliar.

A typical battery electrical car for example requires six times more mineral inputs than a conventional internal combustion engine vehicle, with metal supply and investment falling far short of what is needed to reach the Paris Agreement.

A business plan has been submitted to South Africa's State-owned Industrial Development Corporation to secure funding from Germany's KfW development bank for Project Rainbow, which focuses on building a hydrogen freight corridor for trucks and buses.

"Rainbow is also looking at localised manufacture and assembly of vehicles to support building a local supply chain," said Moodliar, who added during the discussion covered by Mining Weekly that Rainbow has been afforded strategic infrastructure project status.

Brandt outlined Germany's commitment to hydrogen as part of its commitment to the Paris Agreement that calls for a fundamental shift away from fossil fuels and towards sustainable alternatives.

"The transition will affect everyone and everything, our way of life, politics and business," Brandt said.

"We're facing the most fundamental transformation of the global economy in our lifetime, comparable to the Industrial Revolution in the past," he added during the event chaired by mining luminary Bernard Swanepoel.

With demand for gold currently off the charts, South Africa has a huge opportunity to recover gold from its surfeit of gold mine dump material at relatively high speed, a mining event in the Golden City heard on Tuesday.

With gold supply only increasing 1.5% to 2% a year worldwide and being constrained, South Africa has the equivalent of half a dozen gold mines in the form of tailings available for turning to positive account.

"I invite you to go and try to buy some gold Krugerrands. Three months delivery, if you're lucky. There's no gold because the central banks are sucking it all up," Shumba Energy cofounder, chairperson and director Alan Clegg told the Coal & Energy Day chaired by mining luminary Bernard Swanepoel. (Also watch attached Creamer Media video.)

"In South Africa, we've got 800-million tons of gold tailings that contain approximately 30-million ounces of recoverable gold, equivalent to six tier 1 gold mines," Clegg highlighted during his presentation, covered by Mining Weekly.

Clegg put the worldwide gold tailings tonnage at 16-billion tons with a recovery potential of 450-million ounces of gold, which also presents an opportunity for South Africa

As South African gold mining has also taken place hand-in-glove with uranium mined as a byproduct, simultaneous recovery of uranium also needs consideration.

"Uranium is coming to the fore again. Very few people realise that until the mid-eighties, South Africa was the biggest supply in the world of uranium and today we have about 120-million to 150-million pounds of uranium in tailings. If the gold mines restart their uranium plants, they can produce uranium as a byproduct, so there's still a strong position for South Africa to re-enter the uranium market.

On an energy return on an energy-invested basis, it is 90% more energy efficient and 90% less capital intensive to process tailings than it is to start a primary mine, not to mention the shorter permitting cycle.

"If you consider technological advancements in process metallurgy today, tailings are a massive store of value," said Clegg, who calculated that it takes 16 to 20 years to find and build a new mine today in most jurisdictions.

TODAY'S GOLD MARKET

The bulk of gold production is in China, which does not export its gold, and other countries are starting to do the same to underwrite their economic futures.

Clegg described the bull market in gold as being decades in the making, extending back to 1971 when former US President Richard Nixon removed the gold standard, a monetary system where a country's paper money had a value directly linked to gold. Nixon did so to address US inflation and to discourage foreign governments from redeeming their dollars for gold.

The Nixon shock led to the end of the Bretton Woods Agreement and the convertibility of US dollars into gold. It is seen as the catalyst for the stagflation of the 1970s as the US dollar devalued.

Owing in large part to the Nixon shock, central banks now have a greater degree of control over their own money, making it easier to manage variables such as interest rates and overall money supply.

"Look at the top ten billionaires. They're buying gold," said Clegg.

Canada-based Lucara Diamond Corp has pushed out the completion date for its underground expansion project (UGP) at the Karowe mine, in Botswana, by a year-and-a-half and increased its capital cost to reach completion by $136-million.

The UGP, which is designed to access the highest value portion of the Karowe orebody and to extend the mine life to at least 2040, will now only be completed by the first half of 2028, instead of the previously anticipated date of the second half of 2026.

As a result, the forecast of costs to completion increased by 25% to $683-million.

The management update to the UGP schedule and budget, issued on Monday, follows a slower-than-planned ramp-up to expected sinking rates and to account for time incurred to date, as well as for anticipated future grouting programmes.

The grouting took longer than planned, owing to a combination of high-water volumes in the sandstone lithologies between 870 m and 752 m above sea level, combined with technical challenges associated with the transition to main sinking.

"Lucara has made tremendous progress on the Karowe underground expansion project, despite many challenges over the last year as we transitioned into the main sink phase of the underground development. Schedule delays due to longer-than-anticipated grouting activity have impacted the project timeline, however, the grouting methodology selected has proven to be effective in controlling water inflows.

"As we transition out of the sandstones early in the fourth quarter of 2023, we look forward to meeting planned sinking rates," says CEO Eira Thomas.

She also stresses that the project remains technically and economically feasible and that its major shareholder remains supportive of the asset.

In a Lucara statement, Adam Lundin comments that the Karowe expansion remains highly economic, despite the delays incurred. "As Lucara's largest shareholder, we remain fully supportive of the company."

The earnings of Anglo American Platinum (Amplats) for the first half of this year are expected to be sharply down.

Headline earnings and headline earnings per share (HEPS) are likely to decrease by between 65% and 75%. Compared with R26.7-billion in the first half of last year, headline earnings are likely to be between R6.7-billion and R9.4-billion, the company informed the Johannesburg Stock Exchange News Service (SENS) on Monday.

HEPS are expected to decrease to between 2 544c and 3 569c a share compared with 10 140c in the first six months of last year.

Basic earnings per share for the period are likely to decrease by between 65% and 75% compared with the first half of last year, with basic earnings at between R6.6-billion and R9.3-billion, compared with R26.7-billion in the corresponding period of last year.

Compared with 10 125c in the first half of last year, earnings per share are expected at between 2 506c a share and 3 531c a share.

Earnings have decreased for the period largely owing to a decline in revenue as a result of the lower average platinum group metals (PGMs) basket price.

The main contributors to this were declines in the dollar prices of rhodium and palladium. Rhodium was down 47% and palladium 29% lower.

The weakening rand/dollar exchange rate partially mitigated the dollar price impact on the overall rand basket price, which decreased by 15% against the corresponding period last year.

Furthermore, sales volumes from own production, excluding trading, were 12% lower, reflecting lower refined production as a result of the Polokwane smelter needing post-rebuild ramp-up in January.

Also lowering sales volumes from own production were yearly maintenance and asset integrity work at the processing operations, along with the impact of Eskom load-curtailment, which resulted in deferred production of 66 400 oz of PGMs.

Continued inflationary pressure and exchange rate volatility have also led to higher mining and processing costs.

Costs incurred in purchasing of concentrate decreased compared with the first six months of last year owing to lower prices and volumes.

Amplats will release results for the six months ended June 30 on SENS on Monday, July 24, the company stated in a release to Mining Weekly.

Toronto- and New York-listed Platinum Group Metals (PTM) is assessing the economic feasibility of constructing a matte furnace and base metal refinery in South Africa, either with or without partners, to process the concentrate from its Waterberg platinum group metals (PGMs) mining project.

PTM's primary business objective is to advance the Waterberg project to a development and construction decision.

PTM, as the Waterberg project operator, is directed by a technical committee made up of representatives from its joint venture (JV) partners, Impala Platinum, Mnombo Wethu Consultants, Japan Oil, Gas and Metals National Corporation and Hanwa.

A matte furnace and base metal refinery is envisioned as a separate business from the Waterberg JV company that could provide offtake terms to it and possibly to other PGM miners as well.

"Discussions with potential participating partners and investors are ongoing," PTM stated in a release to Mining Weekly.

The company, headed by CEO Frank Hallam, is also assessing the economic feasibility of constructing a matte furnace and base metal refinery outside of South Africa to process Waterberg concentrate.

Working with a potential partner in a jurisdiction with less expensive power and water, PTM has completed a trade-off study which indicates that savings on power and water substantially offset the cost of additional concentrate transportation. Before concentrate could be exported from South Africa, a formal government approval would be required and further studies are underway.

The shallow-resourced Waterberg project, located on the Northern Limb of South Africa's Bushveld Complex, is planned as a mechanised, shallow, decline access palladium, platinum, gold and rhodium mine.

In March, positive results from a completed infill drill and a stage-two budget of $3.6-million, covering the period from April 1 to August 31 next year, is a subcomponent of an approved $21-million work programme.

During the nine-month period ended May 31, PTM incurred a net loss of $4.05-million, which was well below the $7.26-million incurred during the corresponding nine months of last year.

Loss per share for the current period amounted to $0.04, as compared to a loss of $0.08 per share for the nine-month period ended May 31, 2022. Total expenditures on the Waterberg project, before partner reimbursements, for the nine months were $3.5-million.