The Mining Indaba returned to Cape Town from 9 to12 May 2022 where the mining community gathered to discuss the future in the industry with the overarching theme, “Evolution of African Mining: Investing in the Energy Transition, ESG, and the Economies.”
The discussions were driven by three heads of state and one prime minister, namely the President of South Africa Cyril Ramaphosa, the President of Botswana Mokgweetsi Masisi, newly-elected President of Zambia Hakainde Hichilema and the Prime Minister of the Democratic Republic of Congo (DRC) Jean-Michel Sama Lukonde Kyenge.
The four of them shared interesting insights about their plans to ramp up production of commodity inputs needed in the manufacture of rechargeable batteries and shift to renewable energy. To reach the demand level, lithium production is expected to double from 2018 to 2022, supported by capacity expansion and new mines entering production, mainly in Chile, Australia, Argentina and Canada. The main sources of lithium globally are brines and hard-rock deposits. Production from brines is more economical, with largest deposits being in the Americas and China. Hard-rock deposits, however, are somewhat more challenging to process, especially on the beneficiation side, while the efficiency of the operations is key in maintaining sustainable production costs. Hard-rock deposits can be found in Australia, Canada, Zimbabwe and Portugal.
Cobalt is a key component of cathodes of most types of rechargeable lithium-ion batteries. The global demand is expected to grow by 10 percent (Compound Annual Growth Rate (CAGR) to 2022. Most cobalt is mined as a by-product of copper (67 percent) or nickel (31 percent). The DRC is expected to remain the main cobalt producer, now accounting for almost 70 percent of global production, while the rest is divided among Cuba, Russia, the Philippines and Australia. The industry has been preparing for an upswing in demand by building inventories and securing longer-term supply. Even with the recent developments of declining average cobalt content in automotive batteries, by 2025 cobalt is expected to still be a key component.
Battery producers seek nickel-intensive cathode materials to improve battery energy intensity, strongly supporting nickel outlook. Sustained undersupply is expected in the short- to medium-term. As a result of this skyrocketing demand, commodity prices are on the rise, raising optimism of increased profitability among the mining community, hence the vigorous intent by commodity mining countries to increase production to take advantage of the rising commodity prices.
Botswana has a long history in exploration and mining. While archaeological and other scientific evidence points to mining activities from as far back as the Middle and Late Stone Ages, modern mining started with the re-discovery of gold around the present-day Francistown in 1865. In his key note address to the Indaba on 9 May, President Masisi said Botswana is basically under-explored in terms of mining, and that as a mineral-rich nation, the government believes there is more to mine and therefore a need to intensify exploration. According to the President, approximately 25 percent of Botswana is covered by pre- Kalahari geological formations and this is where all of the current operating mines in the country are located. “The unexposed 75 percent, covered by sands, are potential untapped mineral prospects that can drive mineral investment,” he said.
To help unlock the potentially untapped mineral prospects, Masisi noted that the Botswana Government continues to invest in creating pre-competition data to promote exploration. He disclosed that the government is completing a project that will bring coverage of geological mapping to 90 percent nationwide through interpretation of geophysics data covering Northern Botswana that has in the past remained largely unexplored due to sand cover and remoteness. “We therefore implore mining investors present at this Mining Indaba to seriously consider coming to Botswana to carry out exploration and mining projects,” he said.
For his part, Zambian president Hakainde Hichilema expressed so much optimism and confidence that left the delegates in awe. He emphasised the need for African leaders to treat seriously the sustainable development of mineral resources and ensure that there is beneficiation. “In Zambia, we are tired of talking about potential, we want to realise the potential,” he said. To take advantage of the shift in energy sources geared at reducing carbon emissions, metals like copper and other commodities are in demand and are experiencing a rise in prices and the Zambian government is already taking advantage of this.
The new Zambian leader stated that his government will increase exploration for mineral resources and ensure an efficient beneficiation for Zambians. Specifically, President Hichilema said, his government has already set in place a motion to ramp up copper production to position Zambia as one of the largest copper producers with an efficient beneficiation strategy. Because copper is a highly efficient conduit, it is used in renewable energy systems to generate power from solar, hydro, thermal and wind energy across the world. Copper helps reduce CO2 emissions and lowers the amount of energy needed to produce electricity.
Hichilema told delegates that his government, with only eight months in office, will increase annual copper production to 3 million tonnes from just 830 000 tonnes. “It is because we have an abundance of mineral resources in Zambia, not only copper,” he said. This was confirmed by Tristan Pascall, the CEO of First Quantam Minerals, who told the conference that US1.3 billion will be invested by the company to extend the lifespan of its copper mines in Zambia and to increase copper production. “Further, US115 million will be invested in technology for downstream beneficiation while another US100 million will be invested in beneficiation,” he revealed. Such investments, according to President Hichilema, are meant to help Zambia take advantage of the rush towards clean energy.
For his part, the Prime Minister of the DRC, Jean-Michel Sama Lukonde Kyenge, affirmed that his country is very rich in copper, zinc, cobalt, nickel, lithium and all other metals that are needed as inputs for production of renewable energy from sources like solar power and rechargeable batteries. “In the DRC, we are only exploring 19 percent of our potential in mineral resources,” Prime Minister Kyenge said. “The rise in commodity prices, as well as in commodity demand, has prompted us to increase our exploration activities. A national strategic plan on rights of mineral resources has been established, which is investor-friendly and also promotes beneficiation.” This, he said, offers an opportunity for further mineral exploration in the DRC, which is the world’s fourth largest copper producer, in a win-win situation where investors, the government and citizens all benefit.
The DRC’s copper production increased from 400 000 tonnes in 2016 to 1.5 million tonnes in 2021 and, according to Kyende, is expected to rise further in 2024 because development of the copper value chain is underway. Further, the DRC is the largest cobalt producer in the world at 19 000 tonnes per annum. According to Prime Minister Kyenge, with cobalt an important component in rechargeable battery production, his country will ramp up its production and ensure increased beneficiation and return for investors.