Mining
From The Report: South Africa 2012
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The mining industry has long been a driving force behind South Africa’s economic growth. In 2010 it contributed 18% of GDP, and the country’s total reserves, while diminished, remain some of the world’s most valuable, with an estimated worth of $2.5trn. South Africa is perhaps best known for its gold, diamond and platinum riches but its wealth in other metals and minerals have also helped support industry as new economic sectors have developed. However, the industry is widely perceived to have experienced an extended period of decline. Significant steps forward will be required in infrastructure provision, the development of a market-friendly mining policy, human resources improvement and the encouragement of major investment in the industry.

This chapter contains interviews with Susan Shabangu, Minister of Mineral Resources; Bheki Sibiya, CEO, Chamber of Mines; Godfrey Gomwe, Executive Director, Anglo American South Africa; Nick Holland, CEO, Gold Fields; and Andile Sangqu, Executive Director, Xstrata South Africa.

Articles from this Chapter

Overview

An attractive prize: The sector’s importance is promoting new cooperation
OBG
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The mining industry has long been a driving force behind South Africa’s economic growth. Although some mines have reached maturity, the country still relies heavily on its mineral output and the industry’s producers have become global behemoths. South Africa’s total reserves, while diminished, remain some of the world’s most valuable, with an estimated worth of $2.5trn. The potential is clear, and a consistent mining policy increased investment in existing and new mines and, crucially,…

Interview

OBG talks to Susan Shabangu, Minister of Mineral Resources
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Interview:Susan Shabangu How can greater beneficiation be achieved when it comes to the minerals sector? SUSAN SHABANGU: Greater beneficiation in the mineral sector requires collaboration from all stakeholders in terms of, among other things, creating an enabling environment throughout the minerals and mining value chain. Such an environment should guarantee that there is availability of minerals to be beneficiated, appropriate skills are continuously developed and investment continues to…

Interview

OBG talks to Bheki Sibiya, CEO, Chamber of Mines
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Interview:Bheki Sibiya What advancements are being made in the industry with regard to beneficiation? BHEKI SIBIYA: Those who say there is a lack of beneficiation do not always understand the full range of what it entails. If one mines coal at a low calorific value and improves the value by blending it to make it more attractive for exports, it can be argued that beneficiation is taking place. If coal is converted to generate electricity, that is another form of beneficiation, as the coal…

Analysis

Strong and steady: Iron ore is an increasingly attractive segment
OBG
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Critical in the production of steel, iron ore, which represents around 95% of all metal used each year – is a major potential growth area for South Africa. According to a March 2011 report released by Kumba Iron Ore (KIO), a South African unit of London-headquartered Anglo American and the fifth-largest seaborne iron ore supplier in the world, the country’s iron ore production could as much as double over the next 10 years if the conditions are right. This would entail adequate ancillary…

Analysis

State role debated: Talk of nationalisation has investors concerned, despite assurances from the government
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Thanks to its economic centrality South Africa’s mining industry has long been the focus of political rhetoric, which has sometimes resulted in polarising debates. Calls from radical elements in the African National Congress (ANC) over the course of 2011 for the nationalisation of mines have badly shaken investor confidence and – while these calls have largely been dismissed – there is an ongoing debate about how the state can better utilise its mineral resources to address poverty and…

Interview

Sustainable transformation: OBG talks to Godfrey Gomwe, Executive Director, Anglo American South Africa; Nick Holland, CEO, Gold Fields; and Andile Sangqu, Executive Director, Xstrata South Africa
OBG
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Interview:Godfrey Gomwe,Nick Holland,Andile Sangqu How are mining companies in South Africa managing and offsetting input-cost pressures? GODFREY GOMWE: In the face of significant cost pressures towards labour, fuel and power, mining companies are applying cost-mitigating efforts through asset and procurement optimisation and moving towards greater capital intensity. To remain competitive, South Africa’s mining sector is dependent on an efficient and cost-effective logistics…

Analysis

Mutually beneficial: The sector is attracting interest, notably from China
OBG
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Investment by international mining companies has long formed a key part of the country’s economic backbone, with extraction often receiving the largest share of foreign direct investment (FDI). While its share of total FDI stock in South Africa remains solid, capital flows into extractive industries were hit hard by the global economic crisis and declined significantly in 2010, compounded by investor uncertainty over ageing infrastructure and electricity and water shortages, as well as calls…