Mining companies in South Africa forced to dig deeper as De Beers presses ahead with $2bn underground mine
De Beers, one of the world’s largest mining companies, is digging deeper in a bid to combat the ever growing difficulty of diamond mining in South Africa.
The company are constructing a new $2billion mine underneath the already existing 450m deep Venetia mine, close to the border with Zimbabwe and Botswana.
Converting from an open pit mine to an underground mine 1,000m below ground, the Venetia mine is predicted to become one of the world’s five biggest diamond mines following its completion in 2022.
The decision to dig deeper to exploit the diamond rich site highlights something of a gamble for De Beers, but a gamble that could pay off quite substantially according to Ludwig Von Maltitz, De Beers Venetia GM.
“Worldwide, the easier diamond sources have probably been found, but with this resource here, we hope we have something we can extend well into the future,” he said.
This optimism is not matched by others in the industry as the price of diamonds has fluctuated tremendously over the last eight years, something that De Beers has suffered from – closing down two of its mines in Canada and Botswana in 2015.
Peter Major, mining specialist at Cadiz Solutions in Johannesburg, believes that De Beers’ new project is “stupendous”.
“We are often told that the growing world population, combined with the increasing difficulty of finding diamonds, will mean prices will always rise, but we will see. The project at Venetia is stupendous – especially as very few other firms are investing in SA,” he said.
Despite the uncertainty in the market, Venetia is expected to operate until at least 2043 – with belief that it could be operate even longer.
“If we can do it well enough, I can’t see why mining should not be a lucrative business going forward.” Said Mr Maltitz.
Read the May 2016 issue of Mining Global magazine.
British Lithium Pressured Due To Calls for Electric Cars
The British demand for lithium is set to reach 75,000 tonnes by 2035 as the government works towards their ban on the sale of high-polluting diesel and petrol vehicles within the UK. This comes as automakers worldwide continue to insist on the benefits electric vehicles will have on slowing the rate of climate change.
It is estimated that the UK will require 50,000-60,000 MT of lithium carbonate a year by 2035 for battery production to satisfy government needs. This is assuming production remains at 1.2 million vehicles per year, and the amount of lithium required does not increase.
British Lithium, which hopes to begin constructing a quarry to produce 20,000 MT of lithium carbonate a year in a $400 million investment, are not without competitors, both within the UK and abroad.
Competition For Lithium Rises In Europe
After only five years after its initial launch, Cornish Lithium is setting its sights on becoming a UK powerhouse in mining lithium, aiming to begin commercial production in under four years. Jeremy Wrathall, a former investment banker and current managing director of Cornish Lithium, had the future in mind when founding the company.
“In 2016, I started to think about the electric vehicle revolution and what that would mean for metal demand, and I started to think about lithium,” he said in an interview with AFP. “A friend of mine mentioned lithium being identified in Cornwall, and I just wondered if that was a sort of unrecognised thing in the UK.”
Lithium was first discovered in Cornwall around 1864 and has not been mined again since 1914 when it was produced as an ingredient in fireworks. Now, however, Cornish Lithium is reportedly in the testing stage to see if the metal can be produced commercially to meet the growing demand required for the electric car sector.
Despite Cornwall’s close historic ties to mining lithium, Wrathall insists that the project is purely commercial.
Cornish Mining Revival For Lithium Production
“It’s not a mission that drives me to the point of being emotional or romantic,” he says. “It’s vitally important that we do get this technology otherwise Europe has got no lithium supply.”
The European Commission has also stated their goal to end the sale of new petrol and diesel cars by 2035 to aid the environment. That being said, the majority of lithium extraction currently relies on power provided by environmentally damaging fossil fuels─a slight contradiction.
Alex Keynes, from the Brussels-based lobby group Transport & Environment, is adamant that mining for lithium should be done sustainably.
“Our view is that medium-to-long term, the majority of materials including lithium should come from efficient and clean recycling.
“Europe from a strategic point of view should be looking at securing its own supply of lithium.”
Despite growing competition from abroad, British Lithium Chairman, Roderick Smith, continues to place importance on the mining of lithium within the UK.
“Imagine what the UK economy would look like if we lost our automotive industry,” Smith says. “The stakes are high for the UK.”
Smith expects the UK to compete with other European countries to secure a lithium battery plant in the near future.