Mineral resources and energy minister Gwede Mantashe urged South Africans not to be fearful that the mining sector is in decline, saying subsectors such as coal and manganese were holding it in good stead.
Mantashe was briefing reporters on the sidelines of the Investing in African Mining Indaba in Cape Town on Monday morning.
The event comes after Stats SA said mining production contracted 9% year-on-year due to load-shedding and logistics backlogs at Transnet.
Mantashe said the mining sector was being driven by growing demand for coal, but this activity came from small investors who were not visible as their investments did not take the shape of “big shafts”.
“In investment, the difference now and then [during previous mining booms] is that we used to see tall shafts being built. You would see shafts at Savuka and Driefontein, all over. One of the sectors growing is coal. Many small producers have emerged in collieries, and they are doing well. Many don’t regard this as an investment in mining but it is,” said Mantashe.
He said South Africa was poised to weather the tough economic year well and comparing the growing sectors with the gold sector during its growth era was a mistake.
“There is an investment and those sectors are growing. They are not listed, but they are growing. If they were listed they would call investors from all over. We welcome this because wealth is not a gift. You have to put your skin in it,” Mantashe said.
When asked whether government was doing enough to encourage and incentivise companies in mining to get into power generation to ease the load-shedding crisis, Mantashe said the state has done enough to encourage companies to do so.
“I have heard allegations that we are not putting enough megawatts on the grid. I ask that if you have embedded generation, we say go ahead. What must we do? We have not seen any stampede of people trying to build their generation plant.
“The problem with the pipeline is you cannot see it immediately. I accept the grid is a problem. It’s in Eskom. However, Eskom is not in my portfolio so I cannot go to Eskom and say it must build this grid,” he said.
Asked about the impact of load-shedding on jobs in the mining sector, Mantashe said mining withstood the blow of load-shedding well, and commended companies in the sector for not “throwing people away during the lockdown”.
“We have seen no reports of a rush of retrenchments in mining because of load-shedding. Goldfields took advantage of generating their own energy and they grew by 10%. More companies are following the Goldfields example.”
Regarding Transnet CEO Portia Derby’s candid remarks that the Minerals Council of South Africa wants her removed because she supports transformation, Mantashe said: “I acknowledged the Minerals Council's commitment to help Transnet and find solutions to the backlogs.
“That is what we should applaud rather than insult each other. There is no need for me to intervene. I must allow the Minerals Council and Transnet to address their issues. If there is an impasse then we can intervene.”
Director-general for minerals and petroleum regulation Tseliso Maqubela confirmed the department was looking into the development of a cadastral system, saying the procurement process was under way for “a bespoke system that has worked in other jurisdictions”.
Director-general in programmes and projects Jacob Mbele said South Africa was in ongoing discussions with countries in the region to buy power, including Mozambique and Zambia, with 300MW available for Eskom to procure from the region.
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