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Mpumalanga Business 2017 edition

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  • Mining
Mpumalanga Business 2017 is the seventh edition of this highly successful publication that has since its launch in 2008 established itself as the premier business and investment guide to Mpumalanga Province. Supported and utilised by the Mpumalanga Economic Growth Agency (MEGA), Mpumalanga Business is unique as a business journal that focuses exclusively on Mpumalanga.

OVERVIEW BHP Billiton

OVERVIEW BHP Billiton Energy Coal SA (Becsa) has three existing collieries in the province and is engaged in rolling out two more big projects. These entail doubling capacity at Klipspruit and improving efficiencies at Middelburg to such an extent that it will extend the life of the mine by 10 years. Former coal trader Wescoal became a coal producer in 2010, and is increasing its exposure to mining. Wescoal is applying for several new coal mining rights in Mpumalanga. It owns and manages the Khanyisa colliery which supplies the Eskom power station at Kendall with coal. Coal of Africa Limited’s Mooiplaats mine, in the Ermelo coalfields in the eastern Highveld, was put on care and maintenance in 2013 and sold in 2015 to Blackspear Capital for R250-million. It was built to supply the Eskom power facility at nearby Camden. Blackspear has a mine (Overvaal) next to Mooiplaats, as well as other mines at Puleng (Middelburg) and the Thutsi mine (Business Day). ArmCoal is a black-owned coal company that arose out of a deal between Xstrata Coal SA and African Rainbow Minerals Limited (51%). ArmCoal was the vehicle used in the creation of the large open-cut thermal coal mine at Goedgevonden. Gold Sibanye Gold’s list of acquisitions continues to grow. Formed as a gold-mining company with one mine in the Free State, Sibanye has rapidly been buying up platinum assets and showing an appetite to become a multi-mineral operation. In Mpumalanga it has purchased and started to develop the Burnstone gold mine near Balfour. After the Canadian-listed company Great Basin Gold went into liquidation in 2012, Wits Gold acquired the mine and Sibanye has purchased Wits Gold. Sibanye is reviving the mine and reports that Burnstone has a maiden gold reserve of 1.8-million ounces. Stonewall Resources runs the TGME Project, near the towns of Pilgrims Rest and Sabie. Operations began in 2011, expanding from an existing tailing operation. The area is historically one of the oldest gold-mining areas in the country. Stonewall has ambitious targets of going beyond production of 40 000 ounces from this and other historic mines in the area. There is renewed interest in the Barberton Greenstone Belt. Having listed on the Australian stock exchange, Vantage Goldfields owns the Lily mine which was in the news spotlight in 2016 when three workers were trapped underground in a container after a rock slide. Vantage purchased Barbrook because it has a processing plant. This plant has been renamed Central Metallurgical Complex. Galaxy and Gold Hill mine currently produce 20 000 ounces of gold per year. The Galaxy company is using new technology to get the ore body out of the sulphide minerals in which it is embedded. Having taken full control of its Barberton mines, Pan African improved its BEE position (Shanduka Gold is a 23.8% shareholder) and set about increasing its annual gold output to 100 000 ounces. The company announced in 2010 that new finds at Royal Sheba will extend the life of Barberton mines by another 15 years. Pan African acquired the Evander gold mine from Harmony and runs two tailings retreatment plants, at Barberton and Evander. Cement Sephaku Cement produces 1.4-million tons of cement at its grinding plant in Delmas. There is undercover storage available for 15 000 tons of bagged cement at the facility. Clinker for the Delmas plant comes from Aganang in the North West Province and fly-ash is sourced from the Sephaku classification plant at the Kendal Power Station, located about 35km to the east of Delmas. Fly-ash is an extender in the final cement product and Sephaku makes about 1.3-million tons of it. This development is partly a response to increased activity in the power sector (Eskom’s build programme) but the company is also very upbeat about the country’s housing sector and the national government’s infrastructure programme. The company was responsible for a 1.2-million ton fly-ash-beneficiation plant at the Kendal power plant. The Provincial Government of Mpumalanga is in a partner- MPUMALANGA BUSINESS 2017 44

OVERVIEW ship with Eskom, in which opportunities for young people who own businesses are created through the fly-ash beneficiation programme. will allow it to produce about 42 000 ounces of PGM concentrate per annum. Sylvania Platinum now has seven PGM recovery plants that extract chrome from tailings on both sides of the Bushveld Igneous Complex. The company also has some shallow mining projects. Platinum group metals (PGMs) Northam Platinum, which has assets on both limbs of the Bushveld Igneous Complex, has purchased the Everest mine from Aquarius Platinum. Everest is adjacent to Northam’s existing Booysendal mine (35km west of Mashishing, formerly Lydenburg). By the end of 2016, and with this new asset, Northam expects to be producing 460 000 ounces of platinum group metals (PGM). A concentrator and a chrome extraction plant were included in the sale price of R450-million. The platinum concentrator at Northam’s Booysendal plant was the site of a technology first in 2014/15, with the first use of a type of flotation control introduced by Mintek, the organisation that does research and development for the mining industry. The technology is software-based and is called FloatStar Grade Recovery Optimiser (FSGRO). The grade measurements that make the process possible were obtained from another South African product, the BlueCube MQi slurry analyser. Jubilee Platinum has sold its smelting and refining business in Middelburg to Siyanda Resources for R110.5-million in 2015. Jubilee wants to concentrate on being a miner, and is confident that its two projects Ferrous metals Lydenburg is home to the Lion ferrochrome smelter that is a joint venture between Glencore and Merafe Resources. Feedstock is primarily provided by mines run by the same two companies, namely Magareng, Helena and Thorncliffe. Assmang, the joint venture between ARM Ferrous and the JSE-listed Assore, operates a chrome mine (Dwarsrivier) and a ferrochrome plant where chrome alloys are made (Machadodorp) in Mpumalanga. The mine has been converted from an operation run by a contractor to an owner-operator mine. Reduced demand for stainless steel in the recession meant that some of the furnaces at Machodadorp had to shut down. The Manganese Metal Company (MMC) in Mbombela is the largest producer of pure electrolytic manganese in the world. MMC is owned by Samancor (51%) and Bilston Investments owns the balance. Nickel Most of the R3.9-billion that has been committed to the upgrade project of the Nkomati operation of ARM Platinum and Norilsk Nickel Africa has been spent. A full nickel off-take agreement exists with Metal Trade Overseas (MTO). A 375ktpm concentrator plant has been built, allowing for greater volumes to be milled. Production levels are rising on the back of increased global demand. Niger Uranium Limited has entered into a joint venture with Southern African Nickel Limited (San) to explore nickel opportunities near Burgersfort in Mpumalanga. Exploration is going to be done for the joint venture by Pangea Exploration. ONLINE RESOURCES Aluminium Federation of South Africa: www.afsa.org.za Chamber of Mines South Africa: www.bullion.org.za Geological Society of South Africa: www.gssa.org.za Mining Qualifications Authority: www.mqa.org.za Mintek: www.mintek.co.za National Department of Mineral Resources: www.dmr.gov.za South African Mining Development Association: www.samda.co.za 45 MPUMALANGA BUSINESS 2017

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