Despite the South African mining industry having recorded two months of decline in production across some sectors such as coal and iron-ore, Mineral and Petroleum Resources Minister Gwede Mantashe has assured industry players that the local mining industry is “alive and kicking.”

During his keynote address at the last session of this year’s Joburg Indaba, on October 3, he discussed the mining sector’s role in driving inclusive economic growth and employment creation, an objective he said had been adopted by the Government of National Unity.

According to Statistics South Africa, Mantashe noted, the sector had experienced a loss of 7 000 jobs in the second quarter.

Hence, he expressed the need for efficient rail and port systems and infrastructure, as well as a reliable electricity supply to sustain the mining industry’s positive contribution to the country’s economy.

He noted that the government continued to invest resources to address these challenges, highlighting that the country had managed to go without loadshedding for about six months.

However, the Minister warned that if logistical issues were not attended to, bulk commodities were going to “pay the price.”

“If you can’t take iron-ore to Saldana and take coal to Richards Bay, and take manganese to Port Elizabeth, then we are in trouble as a sector.”

While he noted that these issues must be given attention, he also indicated that there was a strong case emerging out of a study on the state of mining – being conducted by Mintek and Minerals Council South Africa – that South Africa remains an attractive mining investment destination.

Despite gold being in decline, Mantashe pointed out that South Africa was a significant producer of platinum group metals (PGMs) and manganese, adding that South Africa, and Africa more broadly, also had an abundance of other critical mineral resources.

He posited that the PGM sector was poised to play a critical role in sustaining the mining industry.

“We are not a sunset sector, we are a sunrise sector. Investors must come and invest, because there is potential,” he added.

With regard to beneficiation, Mantashe noted that, by not adding value to minerals, the sector risked exporting jobs and, subsequently, profits.

INVITATION TO CONSULT

He expressed that mining companies should work with the government on the beneficiation of minerals, such as chrome and manganese, by exploring options such as commodity-price-linked electricity tariffs and tax holidays.

For manganese and chrome, for example, he added that the sector should look into reviving closed furnaces and smelters to create capacity to process minerals and add value.

“We can work together on those,” he said.

“It is therefore essential that the industry meaningfully participate in this discussion that seeks to enhance the quantity and quality of exports, promote the creation of decent employment, and diversify the economy . . . there can be no industry that works without partnering the government and the private sector,” he added.

Mantashe also acknowledged the need for a transparent and efficient licensing system in enabling industry growth, noting that the cadastral system was on Phase 2 of development.

He also pointed out that from April 2023 to March this year, the Department of Mineral Resources and Energy (DMRE), of which a split was currently underway, had processed and finalised 127 mining rights, 1 527 prospecting rights and 2 313 mining permits and related activities.

Additionally, out of the 115 applications received for the DMRE’s exploration fund, established in conjunction with the Industrial Development Corporation, Mantashe noted that 45 were now going to the final stages of assessment.

He also noted the importance of artisanal mining in adding value to the industry, adding that the Department had established an artisanal mining fund.

Mantashe also highlighted the potential for junior miners to contribute to the industry's growth and transformation.

He encouraged junior miners to take up the opportunities presented to them in order to transform the industry and ensure that the people of South Africa derived value from its mineral endowment.

Mantashe reiterated the importance of partnership between government and the private sector to achieve the best results.

“As we come to the end of this year’s Joburg Indaba, we want to encourage the South African mining industry to continue sharing insights about the realities of this industry, advance beneficiation at source, and support our exploration initiative. It’s an appeal to the industry, because if the industry doesn't work with us, it's not going to happen,” he said.