“Green metals” were key buzzwords at this year’s African Mining Indaba in Cape Town this week past, but South Africa and other African countries will have to work hard to attract the significant investment that will be required to mine these minerals.
“Green metals” refer to minerals such as lithium, cobalt, nickel, graphite, rare earth minerals, iron, copper, phosphate and platinum group metals, the production of which is anticipated will have to increase substantially in the next 25 years as countries and companies try to meet their decarbonisation and emissions reduction targets by 2050.
For instance, SA Council for Geoscience CEO Mosa Mabuza told delegates at the conference that in the next 25 years or so, more copper will need to be mined to meet the needs of the global renewable energy transition than has been mined in the entire history of the world.
These minerals will be used to make components for solar panels, batteries, electric vehicles, wind turbine systems and hydrogen energy systems, among many other applications of the energy transition.
There are estimates that more than 400 new mines will need to be developed worldwide for the energy transition, and Africa already leads the way in the production of many of these minerals, with, for example, South Africa holding the world’s biggest known reserves of platinum group metals.
For many African countries, Bushveld Minerals CEO Fortune Mojepalo said at the conference, these minerals presented a once-in-a-lifetime opportunity. It will certainly be a boost for South Africa’s mining sector, which has seen gold production, once its biggest commodity export, dip in recent years due to lower production, rising costs and other challenges.
South Africa’s biggest mining export currently is coal, with the fortunes of coal miners lifted by the European energy crisis started by Russia’s war with Ukraine, with the coal price rising about 150% in 2022 and global coal production surpassing 8 billion tons for the first time.
However, the International Energy Agency warns that the demand for coal in developing countries is likely to wane in coming years as traction gains on renewable energy developments, and that it has seen no sign of investment in export-driven coal projects.
The exploitation of these minerals is not without challenges. For instance, Minerals Council environment health and legacies executive Nikisi Lesufi said most of these metals in South Africa were located in the Northern Cape, far away from the ports, as well as from some essential development inputs such as water..
Indeed, while many big mining groups have started to tackle their journey on their own renewable energy production – such as at Gold Fields, Anglo American and Seriti Resources – President Cyril Ramaphosa bluntly admitted to the problems at Eskom when he told delegates that there could be no mining without electricity.
Load shedding was fingered as the main culprit behind the approximate 9% drop in mining production in South Africa last year.
There was also a realisation among delegates that, in many ways, mining in African countries will benefit from the global trend towards more ethical investing, and the focus on ESG (environment, social and governance) by investors and manufacturers alike.
For instance, delegates heard how some vehicle manufacturers plan to vertically integrate their electric vehicle manufacture by sourcing directly from mines, so that they can monitor the ESG of the product value chain. This will go a long way towards preventing some of the bad historical mining practices in some African countries, where communities and their environments were stripped of material benefits from the mining in their regions, and where mines became a lootable coffer for corrupt officials and executives, and particularly during regime changes.
African Development Bank Natural Resources Management and Investment Centre director Vanessa Ushie told delegates that African countries should not develop “green mineral” mining policies on their own, but as a collective, which will not only make it easier to attract investment, but would help to prevent past policy failures in that it would ensure that the countries benefited from the mining investments.
While many delegates also stressed the need for greater beneficiation of the “green minerals” inside the countries where they would be mined, there was also recognition that there were significant infrastructure and skills shortages, as well as local markets of relatively low demand, which presented big challenges to mineral beneficiation.
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