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Africa Mining

Chinese gold miners’ hope for riches shattered by Ghana crackdown – by Kathrin Hille (Financial Times/Globe and Mail – June 9, 2013)

Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

SHANGLIN, GUANGXI PROVINCE — When Wen Haijian left home on May 20 last year to dig gold in Ghana, he promised to bring back a fortune. Those hopes were shattered when an urn with his ashes returned last month.

“A gang of armed robbers came to his mine on April 16,” says his wife, sobbing in front of two framed pictures of Wen, a serious-looking, tall man with a square mustachioed face. “When he got up at night to check on the machinery, they shot him right in the head.”

In Shanglin, a poor county in the southwestern Chinese province of Guangxi with a population of 470,000 people, most of the inhabitants are old people, women or children because so many men have gone to Ghana. The county government estimates that 12,000 people from Shanglin are still in the west African country.

In Shuitai, Wen’s remote home village where almost everyone shares his surname, 100 of the 900 inhabitants are in Ghana. “On average, they go for three years,” says Wen Ruchun, a woman whose husband is in Ghana as well. “The first year, you build up the mine and earn your investment back, the second year you start making some money, and the third year you come home.”

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Copper Expansion: The Copperbelt: the pride of Zambia – by John Chadwick (Publisher International Mining – June 2013)

http://www.im-mining.com/

John Chadwick reports from Zambia’s buoyant copper mining centre, where he worked many years ago.

The first thing I noted when flying into Ndola at the eastern end of Zambia’s prolific Copperbelt was the town’s proud new football stadium. It appears as a symbol of the accomplishments of the Copperbelt this century and its re-establishment as one of the world’s top mining regions. Zambia is Africa’s largest copper producer and the fourth largest in the world – and growing fast. Copper production has rocketed from 257,000 t in 2000, to more than 700,000 t in 2011 and about 650,000 t in 2012. Zambia’s Chamber of Mines predicts output reaching 1.5 Mt by 2016 as a result of the many projects underway.

The road from Ndola to Kitwe (where I started my career in mining as a mining engineer) has been greatly improved and there are plans to improve it further all the way through Chingola and Chililabombwe to the Kasumbalesa border with the DRC as a two-lane highway. Kitwe is the heart of the Copperbelt and a vital centre for mining supplies and services with Zambia and into the DRC’s Katanga Province.

On that road to Kitwe from Ndola, one first passes north of CNMC Luanshya Copper Mines, 85% owned by China Nonferrous Metals Co Ltd (CNMC) and 15% by ZCCM-IH. Luanshya is one of the oldest mines in Southern Africa. It was shutdown in 2008 at the height of the global financial crisis. CNMC reopened the mine in 2009 after extensive modernisation works.

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South Africa can’t get away with just ‘digging dirt’ – Paul Jourdan – by Martin Creamer (MiningWeekly.com – June 5, 2013)

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

CAPE TOWN (miningweekly.com) – While Australia could get away with mining minerals and exporting them without paying attention to local value addition, South Africa could not, independent South African mineral policy analyst Paul Jourdan told the International Mining and Metals third African Iron Ore conference here.

With its far larger population and far fewer square kilometres, South Africa had no option but to concern itself with mineral beneficiation, which he defined as the total domestic value addition embodied in the final exports, excluding all imported inputs.

“Australia can dig dirt for the next 200 to 300 years, and they’ll be fine,” he said.

But South Africa, at one-sixth of Australia’s size and with nearly three times its population, was compelled to introduce ore beneficiation strategies for mineral value chains and resource-based industrialisation.

“Just digging dirt is not an option for us,” the former Department of Trade and Industry (DTI) deputy director-general, former Mintek head and coauthor of the African National Congress’s State Intervention in the Minerals Sector document said in response to Mining Weekly Online questions.

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Least-mined Bushveld SA’s biggest iron-ore resource: Paul Jourdan – by Martin Creamer (MiningWeekly.com – June 4, 2013)

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

CAPE TOWN (miningweekly.com) – South Africa’s Bushveld Complex was the country’s largest but least-mined iron-ore resource, independent South African mineral policy analyst Paul Jourdan told the International Mining and Metals third African Iron Ore conference here on Tuesday.

While the Bushveld hosted between 25-billion tons and 27-billion ton of iron-ore, it was the Kalahari basin with 3-billion tons in the Northern Cape where most of the mining was under way.

“The future resources are very much in the Bushveld Complex,” said the former Department of Trade and Industry (DTI) deputy director-general and former Mintek head, who is currently working with the DTI, the Department of Mineral Resources, the Department of Science and Technology and the State-owned Industrial Development Corporation (IDC) on mineral value chain development.

Kumba Iron Ore was by far the largest miner, followed by Assmang, Evraz Highveld Steel and Vanadium and smaller start-ups. South African production was now at some 55-million tons a year, with plans for expansion.

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Liberia wants neighbours to cooperate to boost mining hopes – by Clara Ferreira-Marques (Reuters India – June 4, 2013)

http://in.reuters.com/

LONDON, June 4 (Reuters) – West African neighbours Guinea, Sierra Leone and Liberia should work together to resolve a dire lack of rail, port and power infrastructure that has held back the region’s mining ambitions, a senior Liberian government official said.

Sam Russ, deputy minister of operations at the ministry of mines in Liberia, said the region should collaborate on export links to make the most of major iron ore deposits, pointing to potentially lucrative cooperation with Guinea to the north.

The billions of dollars required to build rail or road have frozen many West African iron ore projects and rendered others all but impossible in an environment of uncertain prices and tough access to cash. Russ told an investor conference in London that cooperation could help resolve that.

“Our economies are certainly too small to take on these massive investments. If we think about collaborating, we can do a lot,” Russ said, pointing to the proximity of some deposits.

Key for Liberia – an emerging iron ore producer but also one of the region’s least explored destinations – would be cooperation with Guinea. That could, he said, help unlock the potential of Guinea’s giant Simandou mine and benefit Liberia.

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Mining in Zimbabwe: Where to from here? – by Arthur Mutambara (New Zimbabew – May 23, 2013)

http://www.newzimbabwe.com/index.aspx

Deputy Prime Minister Prof. Arthur G.O. Mutambara’s address to the chamber of Mines AGM at Nyamga on Developing and Managing the Mineral Wealth of Zimbabwe for Tomorrow

May 17, 2013

THE mining sector in Africa constitutes one of the largest industries in the world. Africa is the second biggest continent, with 30 million km² of land, which implies large quantities of resources.

For many African countries, mineral exploration and production constitute significant parts of their economies and remain keys to economic growth. The continent is richly endowed with mineral reserves and ranks first or second in quantity of world reserves of bauxite, cobalt, industrial diamond, phosphate rock, platinum-group metals (PGM), vermiculite, and zirconium. Gold extraction is the key driver of Africa’s mining activities.

However, in spite of this rich mineralization, African countries are still walloping in poverty. The primary problem has been the racist and colonial natural resource laws in Africa which empower the investor at the expense of the citizenry who are the bona fide owners of the resource. Based on this flawed framework, most of the mining deals and activities on the continent have been opaque and detrimental to Africans.

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Glencore fires 1,000 workers over wildcat strikes in S.Africa – by by Agnieszka Flak (Reuters U.K. – June 3, 2013)

http://uk.reuters.com/

JOHANNESBURG – (Reuters) – Glencore Xstrata Plc sacked 1,000 workers across three of its chrome mines in South Africa for going on illegal strike last week, bringing those operations to a standstill, the company said on Monday.

The dispute at the mines near Steelpoort, northeast of Johannesburg in Limpopo province, added to long-running friction in the mining industry that has caused production to slow, raised concerns about Africa’s largest economy and sent the rand to fresh four-year lows.

Chromium is a raw material used to produce ferrochrome, a key ingredient to make stainless steel. “About 1,000 of the employees who have participated in the unprotected (illegal) strike have been dismissed,” said Christopher Tsatsawane, a spokesman for the company’s chrome operations.

The strike, which started last Tuesday, was continuing, but supplies to customers were not yet affected, he added. The workers have until Tuesday to appeal the dismissals.

South Africa has well-defined processes for launching strikes and those who fail to get formal approval can be sacked.

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President Zuma draws the line on wildcat strikes – by Martin Creamer (MiningWeekly.com – May 30, 2013)

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

PRETORIA (miningweekly.com) – President Jacob Zuma on Thursday drew the line on wildcat strikes, implicitly declaring unequivocal zero tolerance on future industrial action that is outside of the law.

Announcing a new programme of action for the troubled South African mining sector, President Zuma said that Deputy President Kgalema Motlanthe and three Cabinet Ministers had been tasked with restoring stability and certainty to the mining sector, which he described as an essential “cornerstone of the South African economy”.

He was emphatic that all future strikes needed to be undertaken within what he described as South Africa’s “excellent” legal framework and the Constitution (see also attached video).

“You cannot allow the unions to engage in wildcat strikes,” he said in response to global news agency Reuters’ question on dealing with what was described as “the turf war” between the emerging Association of Mineworkers and Construction Union (AMCU) and the long-standing National Union of Mineworkers.

Leeway had recently been given to AMCU on the grounds of its inexperience.

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AFRICA INVESTMENT-South Africa labour strife creating vicious cycle – by Ed Stoddard (Reuters India – May 29, 2013)

http://in.reuters.com/

JOHANNESBURG – May 29 (Reuters) – Labour unrest in South Africa’s mines, which threatens to spread to bigger sectors like manufacturing, is plunging the economy into a vicious cycle that may spiral into stagflation, disinvestment and more social upheaval.

South Africa’s rand has lost 16 percent against the dollar so far in 2013 and hit new four-year lows this week, with mining worries triggering the latest sell-off – which picked up pace on Tuesday when data showed growth in Africa’s top economy slowed to a snail’s pace as manufacturing output shrank.

All of this is spooking investors and sowing the seeds of more social discontent, as data shows a strong correlation between the rand’s performance against the dollar and inflation, with a time-lag of nine months.

Inflation is currently just under six percent and will accelerate, with the biggest exchange-rate impact likely on food and fuel prices, which will hit working-class households hard.

But the full impact of the rand’s current weakness will only be fully felt nine months hence, after the next round of wage agreements in mining and other sectors have been hammered out.

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Shabangu announces gold, platinum rescue plan – by Idéle Esterhuizen (MiningWeekly.com – May 28, 2013)

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

JOHANNESBURG (miningweekly.com) – Mineral Resources Minister Susan Shabangu on Tuesday announced that her department would develop a rescue plan, aimed at placing South Africa’s wrecked platinum and gold sectors on a recovery path.

Delivering her department’s R1.39-billion Budget Vote in the National Assembly, she said Department of Mineral Resources (DMR) officials had been instructed to “urgently” look at a rescue plan for the gold and platinum sectors, focusing on supply- and demand-side interventions.

“The platinum and gold sectors, which are among the largest sectors of our mining industry in terms of employment, investment and revenue generation, are negatively affected by the persistent global economic environment, which has an adverse bearing on their long-term viability,” the Minister said.

Shabangu stated that South Africa’s recently concluded bilateral agreement with Russia, under which the countries agreed to cooperate on platinum group metals (PGMs) initiatives, would contribute to the creation of a suite of interventions necessary to stabilise the platinum industry.

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Kenya to form a mining corporation, says Balala – by Mwaniki Wahome ([Kenya]Daily Nation – May 26, 2013)

http://www.nation.co.ke/-/1148/1148/-/xvvu7uz/-/index.html

A national mining corporation will be formed to act as the investment arm of the government where joint venture with the private investors is involved. This is one of the recommendations in the envisaged mining Bill that is meant to spur growth in the industry.

This was disclosed as stakeholders got closer to striking a deal on contentious issues related to sharing the income realised from mining activities in the country.

Mining Cabinet Secretary, Mr Najib Balala, said after getting Cabinet approval, the public and other stakeholders’ views will be included before the proposed law is taken to Parliament for debate and adoption.

“The national mining corporation is a strategic vehicle through which the government will invest in the mining industry with the private sector,” said Mr Balala. An earlier recommendation was to form a mining authority, but the idea was shelved after it was found that it would not facilitate the commercial interests of the country in the mining industry.

Experts have faulted the current Mining Act, that was put in place by the British colonial regime for being rigid, hence stifling mineral exploration and, at the same time, failing to spell out how benefits of such wealth are to be shared especially with the communities where the resources are found.

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Africa could still benefit from resources boom – by Geoff Candy (Mineweb.com – May 28, 2013)

http://www.mineweb.com/

According to the African Economic Outlook 2013, while Africa failed to capitalise on the resource boom of the last decade, there still remains hope for growth.

GRONINGEN (MINEWEB) – While Africa failed to capitalise significantly on the resources boom of the last decade, there remains hope that agricultural, mining and energy resources could boost the continent’s economic growth in the future, says the African Economic Outlook 2013.

According to the report, produced annually by the African Development Bank,the OECD Development Centre, the Economic Commission for Africa (ECA) and the UN Development Programme (UNDP). “What has been holding back Africa is not the large share of its primary sector in itself, but the poor performance of this sector.”

That is not to say the continent has not benefitted at all from the boom in resource prices seen over the last ten years, indeed according to the report, Africa’s GDP grew by 64% between 2000 and 2011, of which, 35% was accounted for by natural resources – primarily fuelled by a tripling of prices for metals and fuels.

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Future mines will be technology driven, [South African] Minister tells union – by Martin Creamer (MiningWeekly.com – May 27, 2013)

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

JOHANNESBURG (miningweekly.com) – Technological innovations would drive the mines of the future, which would need to be run by young people with the appropriate skills, Minerals Minister Susan Shabangu told South Africa’s biggest mining union at the weekend.

Urging the central executive committee of the National Union of Mineworkers (NUM) to rise to the new challenge, Shabangu denigrated the current migrant labour system of recruitment as unsustainable, against the changed background of large numbers of unemployed young people now living on the doorsteps of many mines.

“The mines of the future will have to be modelled differently to those that have characterised this industry for the past 136 years. These mines will inevitably have to accommodate young people who will need to operate them, armed with the appropriate skills, technological knowledge and training.

“There’s no doubt that the mining industry of the future will be driven by technological innovations and research and development, and I’m sure NUM will rise to this challenge,” Shabangu said.

The headwinds from a fragile world economy had conspired to make the mining sector a difficult economic terrain, not just for workers and business, but also for government as regulator and policy maker.

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Well intentioned ‘blood mineral’ provision backfires – by Lauren Cook (Medill News Service/UPI.com – May 24, 2013)

http://www.upi.com/

A U.S. law that imposed an embargo on mineral trade used to finance Congolese armed groups has backfired, affecting the region’s poorest artisanal miners.

WASHINGTON, May 24 — A provision in the Dodd-Frank financial reform law aimed at reducing money to militia groups in the Democratic Republic of the Congo by imposing rules on buying minerals from the region has backfired, exacerbating and depriving at least 1 million subsistence miners of their livelihood, several experts told a congressional committee Tuesday.

“Dodd-Frank 1502, the conflict minerals provision … is a case study in how good intentions can go awry,” said David Aronson, panel member and editor of CongoResources.org. “The law imposed a de facto embargo on mineral production that impoverished the region’s million or so artisanal miners; it also drove the trade into the hands of militia and predatory Congolese army units.”

The original intent of the conflict mineral provision, or Section 1502, was to reduce financing opportunities for the militia groups in the Congo’s mineral market by establishing disclosure requirements for companies that use minerals like gold, wolframite, casserite, columbite-tantalite and their derivative metals (tin, tungsten and tantalum) to make their products.

The companies are required to report the particular mineral’s origin. If the material is determined to be from the DRC — or if its source is unknown — they must notify the Securities and Exchange Commission.

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Child Miners Speak: Key Findings on Children and Artisanal Mining in Kambove DRC – (World Vision – May 2013)

World Vision is a Christian relief, development and advocacy organisation dedicated to working with children, families and communities to overcome poverty and injustice. http://voices.worldvision.ca/home/

Executive Summary

Child labour is a highly complex problem interlinked with poverty, a lack of social services and alternative employment, education and health impacts, and exploitation. The challenge we have is to understand the specific circumstances and needs of working children and their families, in particular settings. From there, we can develop appropriate and effective solutions that address these circumstances and needs, and sustainably move children out of the worst forms of labour. Simplified calls to eradicate all child labour often ignore the complexity of the problem, the persistence of poverty, and the difficult choices children face.

Child miners in one community in the DRC’s southern Katanga province speak to this reality throughout this report. A key objective for the research was the direct participation by children. They themselves described the circumstances, impacts and drivers of their work as miners, as well as possible solutions to the challenges they face. This was then compared to, and supplemented by, parents, other community members, and mining stakeholders.

By listening carefully, we heard that:

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