Every Friday, SAfm’s radio anchor Elvis Preslin speaks to Martin Creamer, publishing editor of Engineering News & Mining Weekly. Reported here is this Friday’s At the Coalface transcript:

Preslin: A friendly South African disposition would quickly attract exploration investment, the CEO of one of the world’s top mining companies said this week.

Creamer: We really need exploration investment at the moment, because our mines are depleting. We know that even with the economic crisis we’re in now, it has been the mines that have come to the rescue. The mines are the ones that are paying the huge taxes to the fiscus, so that social grants can be paid, and all the other efforts made to keep this economy going. But to keep the mines going South Africa has to engage in mineral exploration but the country has not done proper exploration for ages.

We find there is great exploration culture in countries such as Canada, Australia and Chile but South Africa, as a mining jurisdiction, have not incentivised exploration as those other mining destinations have. South Africa has deep mines and big orebodies and people have just thought that the engineers can find everything. But, to continue with mining here, we are going to need geologists and one of the most clever geologists in the world is our Dr Mark Bristow. He is now heading one of the biggest gold mining companies in the world and he makes sure that it still engages in intense exploration. He can tell you about all the exploration opportunities around the world that he is engaged with. He is saying in South Africa since 1994, mining has hardly been welcomed, let alone exploration carried out.

He is saying if a smiling face can be given by the country to this sort of investment, there is still a lot of opportunity. It is not necessary, he says, to go into gold or platinum group metals any more. There are so many other metals and minerals at the moment, particularly critical metals needed for the electrification of vehicles, and it is these that can be pursued. Successful exploration has the potential to open up so many opportunities. If some incentives are provided and there is even a smile put on people’s faces about exploration, he thinks South Africa could quickly attract foreign investment. Others are saying it’s a no-brainer.

Preslin: Wind energy generation is already increasing the revenue of a top South African coal-mining company.

Creamer: This is Exxaro Resources, a big coal mining company, which is also looking at renewable energy. They geo in early. They were very clever with this. Already, they have got wind energy farms in the Eastern Cape and elsewhere, which are putting in gigawatt hours second to none.

That particular wind energy contributed to the revenue and we saw that Exxaro paid a big interim dividend, because they had the confidence and the cash coming in. Coal is seen to have a finite horizon and the world is not looking fondly on coal. Exxaro will not invest any more money in coal. They will not expand their coal base, but the coal base that they have got, they will keep and they will deplete.

In the meantime, they are building up an renewable energy portfolio and they are already showing South Africa that there is potential on the wind energy side and it is just a matter of time now before they collaborate with Eskom and across the country with solar power as well.

Preslin: A ferrochrome joint venture intends going green and clean by generating 450 MW of its own electricity.

Creamer: It is very important that our ferrochrome becomes green and clean, because the world is looking down at it and saying that  a lot of carbon is being used to produce it. Eskom is a coal-fired power provider and our ferrochrome industry uses a lot of that power. But the ferrochrome industry is saying now that not only do they pay through the nose for coal-fired Eskom power, but it also needs to decarbonise, and it wants to generate its own clean power to do that.

A big effort is being made and we heard Merafe Resources, which is headed by Zanele Matlala, saying this week under questioning, that they, with their joint venture with Glencore, are planning about 450 MW of their own power generation, which will be the biggest single effort made by any company.  What Merafe is aspiring to do is to use its own the off gases to generate on-site electricity. Also, they want renewable energy, wind and solar around their smelters. Then they also want to go to places distant from their smelters, like the Northern Cape, and set up big sun power there, and then persuade Eskom for that to be wheeled. Wheeling is the big word coming through now regularly.

People are going to self-generate but they need to transmit what they generate not only to their own operations, but they need to sell what is in excess and wheel it to others. They are talking about 450 MW, that is their aspiration and they have got a three-stage plan. Hopefully it will get going soon.

Preslin: Thanks very much. Martin Creamer is publishing editor of Engineering News & Mining Weekly.