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Africa Mining

At South African Mine, It’s a Long, Long Way Down – by Christopher Torchia (Associated Press/ABC News – April 4, 2014)

http://abcnews.go.com/

For those who grumble about their daily commute, imagine this ride to work: clamber into an elevator cage and plummet 2.4 kilometers (1.5 miles) into the earth, so fast that ears pop from the changing air pressure. Then board a small railroad car that creaks and grinds the same distance to the outer reaches of a South African gold mine.

It gets humid down below. Sweat flows. For the unaccustomed, the din of drills and other machinery is disorienting. Travelers are weighed down by boots and a jumpsuit, a helmet with a mounted flashlight and a “self-rescuer,” a metal canister with a breathing tube and an oxygen supply in case something goes wrong.

Miners have a chain of command, but the extreme conditions are a kind of leveler.

“We’re all equal underground,” Gerard Pienaar, senior operations manager at South Deep mine, said on a recent tour of the flagship operation of Gold Fields Limited that provided a look at some of the conditions in South Africa’s mining industry that drives the continent’s biggest economy.

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Time to make Canada free of conflict minerals – by Paul Dewar (Toronto Star – April 03 2014)

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

Paul Dewar, New Democratic Party MP for Ottawa Centre riding, is the Official Opposition’s Foreign Affairs critic.

Today (Thursday, April 3) the House of Commons is to begin debating my bill C-486, the Conflict Minerals Act.
The illegal trade of conflict mineral from the Democratic Republic of the Congo and other parts of central Africa has been funding and fueling the deadliest war since the Second World War. The Conflict Minerals Act is a significant and proactive step toward ending the trade of conflict minerals and eventually ending the war.

The scale of the crimes in the Congo, and the connection between consumers and the conflict, is shocking. More than five million people have been killed. Rape is used as a weapon of war – with an estimated 48 women raped every hour. In 2012, there were 2.2 million people displaced and driven away from their homes.

Bill C-486 is part of an international trend to end the trade in conflict minerals and improve consumer awareness of product supply chains. The aim is to cut off the financial resources that sustain the horrors of war in the Congo. 

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Ghost towns haunt S.Africa’s strike-hit platinum belt – by Zandi Shabalala and John Mkhize (Reuters India – April 4, 2014)

http://in.reuters.com/

MARIKANA, South Africa, April 4 (Reuters) – Shad Mohammed’s electronics and household store in South Africa’s platinum belt has survived a series of mining strikes over the 14 years it has been serving customers in the dusty town of Marikana.

Yet with the latest stoppage now in its 10th week, he has sold just 10 phones instead of well over 100, and has had to branch out into deliveries to avoid giving up and going home to Pakistan, another statistic in a devastating industrial dispute. “Our business is totally dependent on the mine workers,” Mohammed, 38, said among shelves filled with cell phones, laptops and large pots. “If they don’t work we really suffer.”

Members of the Association of Mineworkers and Construction Union (AMCU) have downed tools at Lonmin, the main employer in the tough town of Marikana, and rivals Anglo American Platinum and Impala Platinum in a strike over wages, hitting 40 percent of global production.

The stoppage shows no sides of ending with the two sides still poles apart. AMCU wants a basic-entry level wage in three years of 12,500 rand ($1,200) a month, or annual hikes of around 30 percent, while the companies have offered increases of up to 9 percent and say they can afford no more.

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South Africa’s PIC Says Platinum Producers Should Control Prices – by Franz Wild and Janice Kew (Bloomberg News – April 3, 2014)

http://www.bloomberg.com/

South African platinum producers, which account for almost three quarters of world supply, should consider controlling output to improve prices, said the head of Africa’s biggest fund manager.

Anglo American Platinum Ltd. (AMS), known as Amplats, Impala Platinum Holdings Ltd. (IMP) and Lonmin Plc (LMI), the world’s largest producers of the metal, need prices to climb to offset rising costs in an industry already beset by a “concerning” 11-week wage strike, said Elias Masilela, 49, the chief executive officer of the Pretoria-based Public Investment Corp., which manages 1.6 trillion rand ($150 billion) of South African government workers’ pensions.

“They may, as an industry, want to think about supply-demand conditions globally to influence the price,” Masilela, 49, said in an April 1 interview in Johannesburg. “South Africa is a major supplier of platinum, but remains a price-taker. There must be a way of balancing that out given it’s size.”

Masilela’s comments echo those by the governments of South Africa and Russia, which together hold about 80 percent of platinum group metal reserves. The countries plan to set up a production bloc resembling the Organization of Petroleum Exporting Countries, a cartel of the biggest oil-producing countries, they said in March last year.

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Miners in lock-down in Guinea as Ebola death toll hits 84 – by Saliou Samb and Stephanie Nebehay (Reuters India – April 3, 2014)

http://in.reuters.com/

CONAKRY/GENEVA – (Reuters) – Foreign mining firms have locked down operations in Guinea and pulled out some international staff, executives said on Wednesday, as the death toll from suspected cases of Ebola there hit 84.

The West African nation’s government said four new suspected cases of one of the world’s most lethal infectious diseases had been reported in the last 24 hours, bringing the total to 134.

Medical charity Medecins Sans Frontieres (MSF) has warned Guinea was facing an unprecedented epidemic of Ebola that would test weak health systems across West Africa.

Suspected cases of the disease – which has a fatality rate of up to 90 percent – have also been reported in neighboring Liberia and Sierra Leone, while Gambia said two people had been quarantined after arriving from southeastern Guinea.

The epicentre of Guinea’s two-month old outbreak has been in the southeast, close to its main iron ore reserves. The country is also the world’s top exporter of bauxite, the raw material used in aluminum production, and has rich deposits of gold.

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South African mining: Stuck in the past (Financial Times – April 1, 2014)

http://www.ft.com/home/us

Critics warn that the migrant labour system threatens the stability of important gold and platinum producers

Mcingelwa Maqotyna still remembers the humiliation that came with applying for the job: being forced to strip naked in a room full of other men, then stepping on to scales to be weighed.

Once he had landed the job, he travelled hundreds of miles from his village to a mine, where he had to get used to plunging deep beneath the surface of the earth at lightning speeds. Seeing the cage-like lift for the first time, he fearfully wondered if its exposed cables would hold.

For Nicolson Mkananda it was the contrast between the tranquil rural environment in which he had grown up and the hustle and bustle of life at a mine that struck him: the individualism, the strange languages and the strict control and discipline imposed on workers. “It was very, very frightening to go there,” he says.

These men, who left their remote villages near Lusikisiki in South Africa’s Eastern Cape in the 1960s and 70s, were part of a vast pipeline of cheap labour that allowed the country’s gold and platinum sectors to flourish. This system of migrant labour was developed during colonialism and extended under apartheid, becoming a pillar of the economy.

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Why are platinum and palladium not meeting analyst expectations? – by Lawrence Williams (Mineweb.com – April 1, 2014)

http://www.mineweb.com/

The impact of the 10 week old strike which has halted production at a number of South Africa’s platinum mines so far seems to have had little impact on pgm prices. Why?

LONDON (MINEWEB) – While every now and again some analyst or other comments that perhaps palladium is outperforming gold, or platinum is, on the year to date both the pgms have moved up pretty well pari passu with gold overall. All three metals are around 7-8% up since the beginning of the year. Indeed gold moved up substantially further during the height of the Ukraine crisis and while the pgms followed they did not quite do so to the same extent. As gold has fallen back though, the pgms have caught up again.

Many analysts have been preaching the investment merits of the pgms in the light of the long running platinum strike in South Africa which has seen a number of mines effectively shut down so far for some ten weeks – with no end in sight to the strikes yet.

The more aggressive AMCU which has become the dominant player among the platinum mine unions, has been demanding an effective doubling of the workers’ wages which the mining companies have concertedly said they cannot afford – and with many of the deep narrow reef platinum producers finding it tough to make any kind of profit even at current platinum prices they do have a point.

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Kinross announces lower capital costs for Tasiast in Mauritania – by Henry Lazenby (MiningWeekly.com – April 1, 2014)

http://www.miningweekly.com/page/americas-home

TORONTO (miningweekly.com) – Canadian miner Kinross Gold on Monday announced the results of a feasibility study that examined the viability of significantly expanding output at its Tasiast mine, in Mauritania, saying that the expected capital cost would be less than what a prefeasibility study (PFS) estimated last year.

The TSX- and NYSE-listed miner said that the initial capital cost to expand the mine would be $1.6-billion, compared with its PFS estimate of $2.7-billion. A thorough review of project design, execution and scope produced about 230 cost-saving initiatives worth about $493-million.

Examples of the cost savings included pre-assembled plant modules, concrete precasting and greater reliance on in-house technical expertise for mine planning, engineering, geological modelling and overall project oversight.

The company also expected a decrease in Tasiast’s expected water demand owing to a planned reduction in dump-leach processing, more accurate mill modelling and greater-than-expected water availability from current sources, which had resulted in the company being able to defer the need to begin building a sea water pipeline from the coast to the mine until 2018.

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Ivanhoe PEA provides glimpse of SA’s potential platinum future – by Jeff Candy (Mineweb.com – March 28, 2014)

http://www.mineweb.com/mineweb/

The miner is planning to have an 8 million t/y platinum operation up by 2024, at costs of under $500 an ounce excluding by-product credits.

GRONINGEN (MINEWEB) – Ivanhoe Mines’ preliminary economic assessment of its Platreef PGM project in South Africa is some welcome good news for a sector that has had more than its fair share of bad.

As the world’s three largest platinum miners continue to bleed in the wake of a strike that has cost them and their workers billions of rands, Ivanhoe’s PEA, released yesterday, confirms the size and scope of a project that not only has the benefit of significant base metal credits, but also ore veins that are wide enough to accommodate mechanised mining.

Driving home the difference between Platreef and its deep, thin-veined peers, CEO, Robert Friedland commented, “We’re looking forward to working with all of our stakeholders to advance the Platreef Project to production, to create valued and skilled jobs and to significantly contribute to the socio-economic development of the people of area communities who will have a voice in decision making and a direct share in our success through our responsively structured, broad-based, black economic empowerment partner.”

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Fear of deadly reprisal, hunger, in Rustenburg as SA platinum strike marches on – by Ayanda Mdluli (Mineweb.com – March 27, 2014)

http://www.mineweb.com/

Mineweb correspondents investigate conditions and perspectives in Rustenburg – the town at the heart of a strike in South Africa’s platinum sector.

RUSTENBURG (MINEWEB) – When workers sell their hard earned possessions to buy food in the platinum belt of Rustenburg for lack of earnings after nine weeks of a brutal strike one can conclude bread-and-butter politics truly have the region in its grip.

Many stores are shuttered, except pawn shops, which are overflowing with household items that have been sold for next to nothing. In Rustenburg homes, cooking pots once filled with solid chicken cuts now swim with chicken heads and feet instead.

“I would love to talk to you about what is going on but the problem is that I am just too hungry and I need to look for something to eat. The problem is here,” says a middle-aged man, pointing to his abdomen.

His point made, the man, who claims to be a worker in the Karee Mine at Lonmin in Marikana, Rustenburg, South Africa, walks slowly away down the dusty street.

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Congo’s mining tax increase plan rattles investors – by Peter Jones (Reuters U.S. – March 26, 2014)

http://www.reuters.com/

GOMA, Democratic Republic of Congo, March 26 (Reuters) – D emocratic Republic of Congo aims to double tax revenues from minerals but investors warned that an overhaul of the mining code could remove incentives to invest there.

Prime Minister Augustin Matata Ponyo told a mining conference in the eastern city of Goma that the government intends to increase tax revenues from mining to 25 percent of the national budget by 2016, from 14.5 percent at present.

“Exploitation of natural resources is key to our ambition of becoming an emerging market country by 2030,” he said.

Congo produced a record 943,000 tons of copper last year, making it Africa’s largest producer and driving economic growth of 8.5 percent. Mismanagement, corruption and two decades of violence in eastern Congo have hampered development of other minerals, including diamonds, gold, cassiterite and coltan. Mining executives warned the government’s ongoing revision of the 2002 mining code risked deterring much-needed investment.

“We need a mining code that is sufficiently incentivising,” said Louis Watum, general manager of Randgold’s giant Kibali mine in Congo’s remote northeastern Orientale Province, which poured its first gold in September.

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Child miners pay the price in Burkina Faso’s gold rush – by Joris Fioriti (AFP – March 26, 2014)

http://za.news.yahoo.com/

Perched on the edge of a mine shaft, Joel Sawadogo, 13, readies the fragile plastic lamp strapped to his forehead with an elastic band as he prepares to lower himself into the darkness.

He is one of hundreds of children and young people working at the Nobsin mines, about an hour’s drive from Burkina Faso’s capital Ouagadougou, who every day risk their lives in the search for gold in the impoverished west African nation.

Child mining has become a growing problem in Burkina Faso, where 60 percent of the population is under 25. A mining boom in recent years has made the country Africa’s fourth-largest gold producer, where exports of the yellow metal account for almost a fifth of economic output.

Joel, who started working at the mines two years ago, makes a meagre income from the backbreaking work. Sometimes it’s 5,000 CFA francs (7.6 euros, $10.5), on a good day twice that, but often nothing at all. “Down there, it’s really damp,” he said, scratching a filthy arm. He hopes one day to find “less painful work” but “mostly, I think about what I could earn”.

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Did cutting access to mineral wealth reduce violence in the DRC? – by Laura Seay (Washington Post – March 25, 2014)

http://www.washingtonpost.com/

One of the most underreported stories about conflict in Africa of the past few months involves the demise of the Democratic Republic of Congo’s M23 rebel movement. M23 (started by a group of disgruntled Congolese army soldiers who used to be part of another rebel movement called the CNDP) was led by mostly ethnically Tutsi Congolese and had as its stated aim protecting Tutsi interests and civilians in the DRC’s eastern Kivu provinces.

Though Kigali disputes the claim, the U.N. Group of Experts on DRC, Amnesty International, and Human Rights Watch gathered large bodies of evidence showing that M23 rebels received substantial financial, logistical, and manpower support from the Rwandan government. But in November 2013, the rebels, who just a year before had been powerful enough to take a major eastern city, Goma, collapsed.

Why? What explains the sudden dissolution of a major rebel movement in a country known for its proliferation of armed groups? Why was the notoriously incompetent Congolese national army, the FARDC, able to decisively defeat a rebel movement for the first time since the current regime came into being?

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Miners Brave Congo’s Warlord History as Demand for Tin Soars – by Michael J. Kavanagh (Bloomberg News – March 25, 2014)

http://www.businessweek.com/

As his chartered Cessna flies above the Democratic Republic of Congo’s Katanga province, Mussadiq Hamid Merican flips through the pages of his Malaysian passport, counting Congolese visas.

“Nine, 10, 11,” he laughs, while the plane passes over villages of thatched-roof huts scattered across sparsely forested savannah. “And these are multiple entry visas so it’s actually more than that.”

The pilot banks and approaches a dirt landing strip rolled in the 1980s by a now-defunct tin company. For the past four years, Merican, 34, has been flying in and out of mines like this in Congo for Malaysia Smelting Corp. (SMELT), the world’s second-largest tin producer. Merican’s company is among those trying to determine if it’s possible to mine in the country profitably — without enriching warlords.

Since the mid-1990s, when war broke out in eastern Congo in the aftermath of the genocide in neighboring Rwanda, Congolese minerals have been linked with corruption, killing and sexual violence. Rebels, unscrupulous traders and members of the army helped themselves to tin ore, of which Congo is Africa’s biggest producer, gold and columbite-tantalite, or coltan, an ore used in smartphones and laptops.

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South Africa platinum strike causing ‘irreparable’ damage – producers – by Xola Potelwa (Reuters U.K. – March 25, 2014)

http://uk.reuters.com/

JOHANNESBURG – (Reuters) – Platinum producers Anglo American Platinum, Impala Platinum and Lonmin said on Tuesday a strike now in its ninth week at their South African mines was causing irreparable damage to the sector and local economy.

Wage talks have broken down between the companies and the striking AMCU union, which is demanding a doubling of basic wages, although the world’s top three platinum producers said they were open to talks “within a reasonable settlement zone”.

In a joint statement, the companies said they had lost nearly 10 billion rand ($921 million) in revenues, but also pointed to the cost to communities around the mines in the platinum belt northwest of Johannesburg.

South Africa’s biggest post-apartheid mine strike, which has hit 40 percent of global production of the precious metal, is also seen denting sluggish economic growth and widening the current account deficit as its effects ripple from the platinum communities throughout the wider economy.

“The financial cost … does not tell the full story,” the companies said. “Mines and shafts are becoming unviable; people are hungry; children are not going to school; businesses are closing and crime in the platinum belt is increasing.”

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