South African mining companies to pay for recycling of acid mine water
The Department of Water and Sanitation for South Africa has announced that mining companies across the continent will pay an estimated R12billion in recycling acid mine water, as part of a wider water drainage project.
The costs will go towards removing sulphates from the water disposed from local mines, cleaning Johannesburg’s water supply for commercial use.
Speaking at a launch for a long-term solution to acid mine drainage (AMD) at the AMD Central Basin, Germiston, Johannesburg, the Minster of Water and Sanitation Nomvula Mokonyane believes the project will ‘substantially’ meet the needs of SA’s economic hub.
“The long term solution [of AMD] will turn the acid mine drainage problem into a long term sustainably solution by producing safe water,” she said.
"If we had not intervened, the flow of acid mine drainage into the larger environment, including the natural river systems, would have caused widespread environmental pollution."
The announcement represents the end of Phase one, a five-year investment of R225million to control the flow of acid water from abandoned mines in Guateng. Phase two, will see the acid mine drainage turned into fully treated, drinkable, water.
End-users of the water, including businesses and residents, will pay around R3.6billion of the costs, 33 percent, with the mining companies representing the other 67 percent of all costs.
Read the May 2016 issue of Mining Global magazine
Low carbon world needs $1.7trn in mining investment
According to a new report from consultancy Wood Mackenzie, mining companies need to invest nearly $1.7trn in the next 15 years to help supply enough copper, cobalt, nickel and other metals needed for the shift to a low carbon world.
Cutting carbon emissions
The United States, Britain, Japan, Canada and others raised their targets on cutting carbon emissions to halt global warming at a summit in April hosted by US President Joe Biden.
Meeting those targets will need large-scale deployment of electric vehicles, storage for power generated from renewables and electricity transmission, all of which require industrial materials, such as lightweight aluminium and metals used in batteries such as cobalt and lithium.
Wood Mackenzie analyst Julian Kettle calculated miners needed to invest about $1.7trn during the next 15 years to “deliver a two-degree pathway - where the rise in global temperatures since pre-industrial times is limited to 2°C”.
“At an industry level, there seems to be reticence around investing sufficient capital to develop future supply at the pace and scale demanded by the energy transition (ET),” he said.
Mining firms are wary of making heavy investments after their experience of the last decade when they invested in new capacity just as demand peaked, leading to a collapse in prices and revenues. They also need to please investors, who are unlikely to want to see dividends diverted to capital spending.
Rising demands of investors related environment, social and governance (ESG) issues further add to the challenge.
Australia, Canada and Western Europe carry a low ESG risk but some of the best resources are in high-risk areas, such as Democratic Republic of Congo, which sits on about half the world’s cobalt reserves according to the U.S. Geological Survey. “Given the need to meet tough decarbonisation and ESG targets, Western governments, lenders, investors and consumers will need to get comfortable operating in jurisdictions where ESG issues are more complex,” Kettle said.
Kettle said government support was needed to help miners comply with ESG issues to ensure production from high-risk areas was conducted in an acceptable way to consumers.
“Then, and only then, will the West be able to secure sufficient volumes of the raw materials needed to pursue the energy transition in the timescales envisaged.”