OVERVIEW Mining Diamonds
OVERVIEW Mining Diamonds are sparkling in the Free State. SECTOR INSIGHT Quality diamonds have been extracted at Koffiefontein since 1870. • Seriti Resources has bought the New Vaal Colliery from Anglo American. Diamonds, coal and gold are the three main minerals found in the Free State but the decline of gold mining is a cause for concern. Several summits and a Mining Indaba have focussed on what kind of economic activity can replace gold mining. The mining sector makes up 11% of provincial GDP and continues to play a vital role in the economy. A minerals beneficiation strategy has been developed because this sector is seen as a key area for potential growth. Coal is mostly found in the northern part of the Free State and the gold fields, which form part of the Witwatersrand Basin, stretch from north of Welkom to south of Virginia. Petra Diamonds’ Koffiefontein mine is on the western edge of the province, about 80km from Kimberley. The mine is regarded as a lowgrade deposit, but the diamonds produced are of high value. White stones of excellent quality are produced and fancy pink diamonds are sometimes found. The first mine was found in the area in 1870 and Petra plans to continue mining until 2025 but there are indications that mining could go on even beyond that date. Petra will increase production at Koffiefontein from 50 500 carats per annum (ctpa) in 2017 to about 85 000 ctpa in 2019. The mine increased revenue to .7-million in 2016, an increase of 44%. The price achieved per carat rose by 10% from 2016, reaching 6 in 2017. Petra has seven mines in South Africa. The Star mine, in which Petra (75%) is in partnership with Sedibeng Mining, is the other Free State asset. The Lace Mine near Kroonstad went into business rescue in November 2016 after heavy rains affected operations. In May 2017 owner DiamondCorp put its listed holding company into administration. The primary lender was the Industrial Development Corporation (IDC). De Beers’ Voorspoed diamond mine will have a production capacity of 800 000 carats per year when it is fully operational. During the building phase, about FREE STATE BUSINESS 2018 40
OVERVIEW R70-million was generated in the region, and the company intends spending R400-million per year on developing its capacity. In 2016 De Beers, the South African government and the South African diamond-cutting industry launched a project to encourage diamond beneficiators. Among the first companies involved are Thoko’s Diamonds, African Diamonds, Nungu Diamonds and Kwame Diamonds. Coal The Sigma-Mooiplas mine is run by Sasol Mining and supplies Infrachem in Sasolburg with twomillion tons of coal per year. Seriti Resources has purchased the New Vaal Colliery from Anglo American. Together with two other mines in Mpumalanga Province, Seriti paid R2.3-billion. New Vaal is in the middle of a triangle of three towns that play an important part in industrial production: Vereeniging, Sasolburg and Vanderbijlpark. The mine employs more than 900 people and supplies about 15-million metric tons of coal to Eskom’s Lethabo power station annually. in the Free State but most of its gold assets are in Gauteng. Reports in August 2017 suggested that the company was looking to retrench more than 7 000 workers across several mines. AngloGold Ashanti’s Vaal River Complex operations are mostly near the town of Orkney in the North West Province. However, the Great Noligwa, Kopanang and Moab Khotsong mines are all across the Vaal River in the Free State. The complex includes one uranium plant, four gold plants and one sulphuric acid plant. In 2017 two of the company’s gold mines, including Kopanang in the Free State, were shut down because getting to the ore body was becoming too expensive and too dangerous. Village Main Reef runs the Tau Lekoa mine in the same vicinity. Taung Gold, a Chinese company, runs the Jeanette mine near Welkom. Most of Harmony’s operations, including a tailings treatment, are in the Free State. The mines are Tshipong and Phakisa (near Odendaalsrus), Virginia, Target (near Allanridge), Masimong (Riebeeckstad), Joel (near Theunissen) and Bambanani at Welkom. Phakisa has mineral reserves of just over five-million ounces of gold and Harmony has invested heavily in the project. Gold mines in the Free State also supply a substantial portion of the total silver produced in the country, and large concentrations of uranium occurring in the gold-bearing conglomerates of the goldfields are extracted as a by-product. Other minerals By-products of gold operations (uranium, silver, platinum-group metals and sulphuric acid) and bentonite are also found in the province. Among the companies running large quarries in the Free State are Lafarge, Raumix and Corobrik. Sand, stone aggregate, gypsum and granite are found at various sites throughout the province. Limestone and calcrete occur in the western Free State where salt is also panned. Production is concentrated around the Florisbad salt pan, north-west of Bloemfontein. The Ocean Bentonite Mine near Koppies in the northwest Free State is one of only two in the country. Gold Sibanye Gold came into existence as a result of the unbundling of Gold Fields but it has now been rebranded as Sibanye Stillwater because of the purchase of a platinum and palladium mine in the US of that name. The company is responsible for the Beatrix mine ONLINE RESOURCES Chamber of Mines of South Africa: www. chamberofmines.org.za Geological Society of South Africa: www.gssa.org.za Mining Qualifications Authority: www.mqa.org.za National Department of Mineral Resources: www.dmr.gov.za South African Mining Development Association: www.samda.co.za Southern African Institute of Mining and Metallurgy: www.saimm.co.za 41 FREE STATE BUSINESS 2018
