Changes in mining code lead to disgruntled South African workers
The South African government published a draft of the new Mining Charter last week, and the controversial proposals within it have left the industry in uproar.
There are now new rules surrounding Black Economic Empowerment (BEE) requirements. Mining businesses in South Africa are required to sell 26 percent of ownership to local BEE groups, meaning that a BEE group could then sell shares on to non-shareholders as it would be beyond their control.
According to oilprice.com, the new charter states on this subject: “Where a BEE partner or partners have exited, BEE contract has lapsed or the previous BEE partner has transferred shares to a non-BEE company, the mining right holder must within the three years transitional period from the date of publication of the charter review its empowerment credentials consistent with the amended 2016 mining charter.”
This would force miners to constantly replace BEE shareholders when old ones left, and the rules also specify that five of the 26 percent must go to mine workers through a trust, with another five given to a local community trust. Requirements for black representation in management will be raised, growing from a previous 40 percent to between 60 and 88 percent. Enterprises must also source more capital goods from local black businesses.
Many companies have deemed the new proposal unacceptable, and as such the Chamber of Mines has said that it will engage with the government on the matter during the 30-day comment period for the draft rules.
Vale invests $150mn to extend life of Manitoba operations
Vale has announced a $150mn CAD investment to extend current mining activities in Thompson, Manitoba by 10 years while aggressive exploration drilling of known orebodies holds the promise of mining well past 2040.
Global energy transition is boosting the market for nickel
The Thompson Mine Expansion is a two-phase project. The announcement represents Phase 1 and includes critical infrastructure such as new ventilation raises and fans, increased backfill capacity and additional power distribution. The changes are forecast to improve current production by 30%.
“This is the largest single investment we have made in our Thompson operations in the past two decades,” said Mark Travers, Executive Vice-President for Base Metals with Vale. “It is significant news for our employees, for the Thompson community and for the Province of Manitoba.
“The global movement to electric vehicles, renewable energies and carbon reduction has shone a welcome spotlight on nickel – positioning the metal we mine as a key contributor to a greener future and boosting world demand. We are proud that Thompson can be part of that future and part of the low carbon solution.”
Vale continues drilling program at Manitoba
Coupled with today’s announcement, Vale is continuing an extensive drilling program to further define known orebodies and search for new mineralization.
“This $150mn investment is just one part of our ambitious Thompson turnaround story. It is an indicator of our confidence in a long future for the Thompson operations,” added Dino Otranto, Chief Operating Officer for Vale’s North Atlantic Base Metals operations.
“Active collaboration between our design team, technical services, USW Local 6166, and our entire Thompson workforce has delivered a safe, efficient and fit-for-purpose plan that will enable us to extract the Thompson nickel resources for many years to come.”
The Thompson orebody was first discovered in 1956 by Vale (then known as Inco) following the adoption of new exploration technology and the largest exploration program to-date in the company’s history. Mining of the Thompson orebody began in 1961.
“We see the lighting of a path forward to a sustainable and prosperous future for Vale Base Metals in Manitoba,” said Gary Annett, General Manager of Vale’s Manitoba Operations.