MINERAL BENEFICIATION IN

SOUTH AFRICA

PRESENTATION TO THE SELECT COMMITTEE ON ECONOMIC DEVELOPMENT

26 FEBRUARY 2013

PRESENTATION OUTLINE

Basis for Mineral Beneficiation

Mineral Beneficiation: The Current State

Beneficiation Strategy Overview

Strategy Implementation Framework

Mineral Beneficiation: The Way Forward

Concluding Remarks

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White Paper: The Reconstruction and Development Programme (November 1994)

“Mining and minerals products contribute three-quarters of our exports and the industry employs three-quarters of a million workers, but this could be much higher if our raw materials were processed into intermediate and finished products before export. Our RDP must attempt to increase the level of mineral beneficiation through appropriate incentives and disincentives in order to increase employment and add more value to our natural resources before export. Moreover, this policy should provide more appropriate inputs for manufacturing in South Africa.”

BASIS FOR MINERAL BENEFICIATION

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White Paper: A Minerals and Mining Policy for South Africa (October 1998)

“The aim of the policy will be to develop South Africa’s mineral wealth to its full potential and to the maximum benefit of the entire population. Government, therefore, will promote the establishment of secondary and tertiary mineral-based industries aimed at adding maximum value to raw materials.”

Section 26, MPRDA, 2002

The Minister may initiate or prescribe levels of beneficiation of minerals in the Republic

BASIS FOR MINERAL BENEFICIATION

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THE NATIONAL DEVELOPMENT PLANCountry’s long term plan to 2030Seeks amongst other things to reduce unemployment by improving manufacturingThe New Growth Path, which is a short term plan drawing from the NDP goes into detail with the work that has to be done

THE NEW GROWTH PATHSets a target of creating 5 million jobs in 10 yearsIdentifies structural challenges that impede desired growth rates, Seeks to place the economy on a production-led trajectory with growth targeted in 10 ‘job drivers’, including, inter alia:

The mining value chain, with a particular emphasis on mineral beneficiation as well as on increasing the rate of mineral extraction

BASIS FOR MINERAL BENEFICIATION

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MINERAL BENEFICIATION: THE CURRENT STATE

Coal to Liquids

Titanium OxideFerrochrome

Auto catalysts

Steel

MINERAL BENEFICIATION: THE CURRENT STATE

Source: SARS

Composition of South Africa’s exports in 2010

BROAD VISION

Increase a ratio of beneficiation extent to mineral productionand increase export revenue

Facilitate economic diversification

Expedite progress towards a knowledge based economy

Create opportunities for new enterprise development

Contribute to creation of decent jobs and poverty alleviation

BENEFICIATION STRATEGY OVERVIEW

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COMPARATIVE ADVANTAGE

MINERAL RESOURCES RESERVOIR

[IN SITU VALUATION OF US$2.5 Trillion (Non-energy)]

COMPETITIVE ADVANTAGE

(Strategy Pillars)

•Legislative Framework(MPRDA, DAA etc.)•Multi stakeholder forums (e.g. Platinum Beneficiation Committee)•International trade agreements•Beneficiation strategic interventions

BENEFICIATION STRATEGY

PROVIDES A FRAMEWORK

TO TRANSLATE COMPARATIVE ADVANTAGE

STRATEGY FRAMEWORK

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5 value chains selected to qualitatively demonstrate the value

proposition of beneficiation

Energy commodities

Iron and steel

Pigment and titanium metal production

Autocatalytic converters and diesel particulate

Jewellery fabrication

BENEFICIATION STRATEGY OVERVIEW

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IMPLEMENTATION FRAMEWORK

Two value chain specific implementation framework

developed and approved

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NSENERGY COMMODITIES VALUE CHAIN

IMPLEMENTATION FRAMEWORK (CONT…)

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IRON AND STEEL VALUE CHAIN

IMPLEMENTATION FRAMEWORK (CONT…)

Consolidated implementation framework currently under development with all constituent value chains as chapters

The framework is intended to provide a comprehensive set of interventions that will create an enabling environment to prioritise and accelerate local mineral beneficiation development

The framework is an elaboration of the beneficiation policy, as adopted in June 2011, with emphasis on synergies and integration of existing beneficiation interventions in order to maximise the development impact

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MINERAL BENEFICIATION: THE WAY FORWARD

The Beneficiation strategy implementation framework seeks

to strengthen linkages between sections of the value chains

Successful implementation will require:

Coordination across all three spheres of Government to

leverage on synergies between provinces

Coordination is also intended to optimise beneficiation

implementation spread across provinces, discerning from

the national developmental priority

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CONCLUDING REMARKS

Beneficiation is not an event but a process with game changing

economic opportunities for South Africa

The strategy presents an ideal opportunity to contribute towards

balanced spatial economic development paradigm

Intensification of beneficiation represents win-win phenomenon for

South Africa Inc. including participants across the various mineral

value chains

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ENDS.....

Inspiring new ways…..

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