Q: Europe once branded coal ‘dirty’ but their demand for it has skyrocketed once again. What do we learn about coal from what’s happening now in Ukraine?
A: There are over 80 countries in the world that still rely on coal as a form of energy. These are countries that are fighting to have basic necessities like electricity, which research shows increases the quality of life substantially. Energy poverty is real in Africa, India and Asia. The Western approach to coal cannot be universal. We must remember that developed economies relied heavily on coal during their development.
Demand for coal in Europe right now is driven by sanctions on Russian gas and coal and show that Europe might well be over-exposed to “green” with no back-up at times when there is no wind, running water, endless sunshine or faced with supply shortages. Coal is back in play in Europe because of the war, and despite massive adoption of clean energy in the US, not all of the US uses clean energy.
In Germany and Italy, coal-fired power plants that were once decommissioned are now being considered for a second life. In South Africa, more coal-laden ships are embarking on what’s typically a quiet route around the Cape of Good Hope toward Europe. Coal burning in the US is in the midst of its biggest revival in a decade, while China is reopening shuttered mines and planning new ones. Coal remains and will remain an essential element in the energy mix. We need to make use of cleaner coal in such mix.
Q: How much has been the projected demand for coal in the in the last couple of months?
A: Our key land export markets consist of 80-90 percent bound for South Africa and Namibia. In the last three months, however, sea-bound exports increased significantly with international traders buying to export to Europe and the West. We do not have specific numbers because the final destination overseas is determined by the international traders who buy coal from us. We remain hopeful that this demand will continue.
Q: How has the demand influenced Minergy exports to South Africa, Namibia and overseas?
A: Minergy remains committed to its local markets and continues to supply into these. A massive increase in demand from international markets, stemming from the Ukraine war and sanctions on Russia, has come as a blessing to Minergy as lucrative pricing has made once uneconomical logistics feasible. This has allowed Minergy to place additional product in new markets, historically uneconomical. We continue to look for alternative markets and supply to Namibia is one such market as well as the ability to use their ports as export routes for seaborne thermal coal.
Q: What would it take to fully explore the billions of tons of coal in Botswana?
A: Greater local and even foreign direct investment. Simplifying regulatory processes and promoting ease of doing business needs to be top agenda items. Coal has unfairly been de-campaigned in the West as a ‘dirty’ mineral, which has swayed investors to look elsewhere for investment portfolios. With enough funders and investments in coal, the huge deposits can change our power fortunes and energy independence. Given Botswana’s massive reserves, we are of the opinion that coal should be another diversified revenue stream for the Botswana Government. At Minergy we remain thankful for the support from the government as well as from internal development organisations that have supported our strategy and were instrumental in getting the mine to the phase that it is in at the moment. Partnership with the government and open minds to managing coal is key.
Q: What future do you project for Minergy in the medium and long-term, given what we see now in Europe?
A: We cannot predict how long the situation in Europe will last and we pray that it will be resolved as the loss of lives and destruction of the Ukraine is a human catastrophe. Our model is premised on fully optimising our deposits for the benefit of Botswana and Batswana.
Q: Opencast for coal is a new concept in Botswana. How has Minergy enhanced the skills base?
A: Opencast coal mining and the associated beneficiation of sized coal is a specialised industry. Currently there is no other similar operation in Botswana to recruit from. The South African coal industry is well experienced with this plant operation and the requisite skill is found there. It is necessary for our operations to make use of such skills to operate the plant as we cannot find all the skill in Botswana.
The skill for operating such a plant is different from diamond, tin and copper processing. As such, certain positions require expatriate recruitment, but all these positions are supported with understudy programmes. It is Minergy’s hope, as part of its legacy, to promote and install fully qualified local opencast mining and coal beneficiation skills that are currently not available in Botswana.
Q: Share experiences from the recent Mining Indaba. What is the future of coal?
A: Africa needs to be energy efficient and independent. We remain encouraged at the responsible strategy that the Botswana Government has put into place to support this.
Q: Kindly share in detail infrastructural developments which were brought in place by Minergy in those communities.
A: We have an electronic brochure that showcases all the value add that we have contributed not just to just Medie Village but Botswana as a whole. This is available at our office or electronically on our website www.minergycoal.com. Highlights include:
- Minergy paid for electrification of the mine and Medie Village benefited from the connection, allowing 500 people access to electricity through a self-funded prepaid system. As an extended part of Minergy’s social investment drive, the Kgotla and the clinic have also been electrified, making day-to-day running of these essential services much easier and efficient. This is ahead of the government’s intended electrification programme, which was only planned for 2024.
- The quality of the road between Lentsweletau and Medie has been significantly upgraded compared to the state the road was in before mining operations commenced. Continuous road rehabilitation and dust suppression is undertaken in and around the villages to maintain road integrity. (This is a public road, but the Group takes care of the road as it benefits the community in which the mine operates).
- The dilapidated community hall has been refurbished, including access to solar power and will be handed over to the community.