African Mining Indaba '16- conference diary

The annual Mining Indaba is the foremost global gathering for investing in the African mining value chain. The largely interactive and market led programme brings together the leading representatives from the mining investment community, the world's largest mining houses and Government ministries to share insights into how the sector can drive investments and capitalise on the opportunities available to Africa's mining industry.

So basically not the type of conference that I am accustomed to reporting on. It is 10 years since I attended my last Indaba, this year being my 4th, and the attraction to me is the sheer serendipity of the event, in that you never know who you may meet, often faces from the dim and distant past, or what snippets of interesting information you might glean. A bit like travelling around one of Africa's large National Parks, where nothing of interest happens for long periods, then suddenly out of nowhere a completely unexpected experience.

So it was with a completely open mind, my trusty Lumix FZ200 and an empty notebook, that I entered the Cape Town Convention Centre on Monday February 8th and what follows is my diary of experiences over the next three days, the final 4th day missed due to my return flight to UK.

 Monday February 8th 

 Arriving in time for the conference opening I was relieved, when I saw the queue at registration, that I had taken the time to register the day before. Many in the line would have missed the opening remarks from Jonathan Moore, Managing Directory of Mining Indaba, who welcomed the delegates, around 6000 this year, considerably less than last year, and stressed that it was important for mining companies to invest beyond mining cycles, something also highlighted a couple of weeks ago by SRK Consultants.

The importance of such investment was also a feature of one of the morning's presentations. Rio Tinto has a proud history in Africa, and Alan Davies, chief executive, Diamonds & Minerals, said that despite tough current economic conditions, Africa’s future growth will be driven by the resources sector. “The world population is growing. By 2050 it will increase by a third to 9.5 billion people requiring more housing, more infrastructure, more energy, more resources,” he said. “This is especially true in Africa, where the United Nations predicts population growth from 1.2 billion in 2015 to 2.5 billion in 2050. In other words, there will be a need for the metals and minerals that make modern life work. That’s why Rio Tinto, which currently has nearly 5,000 employees and contractors in Africa, continues to invest and explore the continent for future opportunities. In particular, our exploration team is looking at potential projects in Botswana and Namibia.”

In a more pessimistic address, Anglo American CEO Mark Cutifani said that the group would within days detail plans to withdraw from a number of mining investments "in several countries around the world." Commenting on the outlook for the mining market in 2016, Cutifani said he was unsure whether conditions would improve or worsen, saying mining firms could not rely on a reversal of the slump in prices. "For many of us in the industry, 2016 is already shaping up to be the most challenging yet. Opinions are divided on whether we have reached the bottom of the cycle, so things may still get worse before they get better. In the less than three years I have led Anglo American, the commodity markets have been on a perpetual downward curve, the steepest I have seen in almost 40 years in the industry," he said.

 I took my first stroll around the exhibition, by all accounts smaller than in previous years, and the first familiar face was that of Dave Capstick, of exhibition sponsor FLSmidth. Dave will be back in Cape Town in two month's time at Comminution '16.

Then I caught up with David Spencer, who I last saw 10 years ago, at Indaba '06, and prior to that in Zambia in the early 70s. He was a fellow metallurgist when I commenced work on the Nchanga concentrator in late 1969. After an interesting career he is now Executive Chairman of General Exploration Ltd, a privately owned business focused on gold exploration in the Lake Victoria Gold Field in Tanzania.

With Dave Capstick and David Spencer

Kim-Marie Clothier and John Eyre

Passing the huge UK pavilion Innovation is Great, it was a surprise to meet my old Camborne School of Mines colleague John Eyre, of North Coast Consulting Ltd, Cornwall, with his business partner Kim-Marie Clothier, and in the pavilion Ben Tordoff and Allister McBride of Zeiss, UK, who are sponsors of MEI's next Cape Town conferences, Comminution '16 and Process Mineralogy '17. At Indaba they will be profiling the economics of automated mineralogy, rather than the technology.

As automated mineral analysis moves closer to the mine, it unlocks the ability to drastically increase cost savings through reactive process improvement. Ben noted "as our core technology of automated mineralogy gets faster and nearer to the mineral processing circuits, the economic benefits of operational mineralogy grow".

Ben introduced me to Emma Parker, operations director, and Vicki Partridge, fundraising director, of the UK-based Musangu Foundation, an initiative born out of the mining industry. The trustees of the foundation recognise that mining companies often work in remote regions within Africa and have the capacity to act as a catalyst for the development of social investment projects within the region in which they work. Emma explained that the founding corporate partner of the Musanga Foundation is Consolidated Nickel Mines Ltd (CNM), a private company focusing on nickel production opportunities. Since partnering with Jinchuan to restart mining operations at the Munali nickel mine in Zambia, CNM have also entered into an agreement giving them full operational control of the mine and the adjacent exploration area for a 10 year period, with the option to extend by another 10 years. CNM is hoping to start operations at Munali in 2016, operating through CNM's wholly owned operating company, Mabiza Resources Ltd, employing over 400 mine personnel.

I am hoping that Emma might be able to travel from London to Cornwall in October to take part in Nickel Processing '16, as I am sure that attendees would be very interested to hear about CNM, the Foundation, and the Munali mine.

Ben, Allister, Emma and Vicki

John and Jan Chadwick

Leaving the hall I caught up with John Chadwick and his wife Jan, also from UK. John's International Mining, an Indaba media partner, is also a long time trusted media partner of many MEI Conferences.

The late afternoon provided a multitude of networking opportunities, with many companies providing hospitality. I spent some time in the UK Pavilion, sampling one of Scotland's finest malt whiskies, which made me feel quite home-sick, as this is something which I do most evenings in Falmouth, but never in the very amiable company of the British High Commissioner, Dame Judith Macgregor.

With Ben Tordoff, Dame Judith and Allister McBride

Feeling quite mellow I then made my way over to the Ferrymans Tavern on the Waterfront for a few beers with my old Camborne colleagues John and Roselyne Eyre, and past students Pete Taylor, of Mammoth Mining, UK and Liam MacNamara, Vice President, Sales with FLSmidth, UK.

With Roselyne, Pete, Liam and John

Tuesday February 9th

A relatively quiet, alcohol-free day for me today. And a very hot day, even the 15 minute walk from my hotel on Whale Street to the Convention Centre was a chore.

In contrast to yesterday's gloomy forecast of Anglo American operations, Themba Mkhwanazi, chief executive of Anglo American Coal, said, in a panel discussion on the future of South Africa's coal, that coal would remain an important commodity, and continue to be one of the key drivers in terms of economic development.

Strolling around the exhibits, it was good to see MEI Conferences sponsors Outotec and Bruker strongly represented.

Outotec is sponsoring the next 3 MEI Conferences, including Biohydromet '16 and Sustainable Minerals '16 in Falmouth (posting of 1st February) and Angie Voges, of Outotec South Africa, is a regular at all the Cape Town events. She is pictured below with Outotec's Robin Lindahl (Germany), Kalle Harkki (Finland), Dirk Slabbert (South Africa) and Mikko Immonen (Germany).

Bruker, a major manufacturer of analytical instruments, is a sponsor of Process Mineralogy '17, and pictured below are Donald Osmond of IMP Scientific and Precision, a South African agent of Bruker, with Karsten Knorr and Anja Griessmeier, of Bruker AXS, Germany and Lynsey Singh, of Bruker AXS, South Africa.

It was strange to see such familiar companies exhibiting, with no machines of any kind on display, a reminder that Indaba is very much an investment conference. In fact the only piece of mineral processing machinery on display was Russian company Bourevestnik Inc's diamond sorter. The company has a great tradition in the area of design and manufacture of X-ray Luminescence Sorters, starting from supply of the world's first X-ray sorter for diamond production in 1969. Since then it has supplied more than 1600 sorters, some 600 still being in operation.

Bourevestnik's diamond sorter

Wednesday February 10th

There are deeply polarised view on mining in Southern Africa, as was evident as I arrived for my final day at the Convention Centre this morning.

Mining can never be totally environmentally friendly but, as we know, everything we use or touch is either mined or grown, and in his excellent keynote address this morning Robert Friedland, Executive Chairman and Founder of Ivanhoe Mines Ltd, put forward a strong case for mining's contribution to a greener world, particularly in respect of PGMs, Cu and Zn, commodities which Ivanhoe is very actively involved with in Africa.

He argued that air pollution, which kills an estimated 3.3m people per year should be of much more concern than global warming, and that PGMs are critical to healthier air. The automobile is the most lethal pollutant in major cities, and 30g of Pt are needed per automobile for catalytic converters.

Ivanhoe Mines is developing the giant Platreef Project on the Northern Limb of the Bushveld Igneous Complex, approximately 280 kilometres northeast of Johannesburg, in South Africa's Limpopo province. The project's resources consist of PGMs, nickel, copper and gold. The planned mine, which is expected to begin operation in 2019, is projected to become the lowest-cost producer of PGMs in Africa. Friedland said it would be a state-of-the-art modern mine, expected to last for the next 100 years, and that it would make the most of new automation technology. “Everyone working at the mine will be in an air-conditioned cab and there will be no exploitation of human labour. It’s the kind of mine operation where there will be no fatalities or injuries. The men and women who work here will be very well paid professionals who will lift nothing heavier than a pencil,” he said.

Copper is at the heart of green energy, lithium batteries containing over 50% copper, so a huge amount of extra copper will be required for the development of electric cars. Copper and its alloys are also antimicrobial materials and so will increasingly be needed in hospitals to replace stainless steel.

Friedland talked about the Kamoa Copper Project, situated in the Kolwezi District, Katanga, Democratic Republic of the Congo (DRC). The project includes the development of a 5Mtpa underground mine and a concentrator to produce blister copper and sulphuric acid. With an indicated resource of approximately 740Mt, Kamoa is regarded as Africa's largest, high-grade copper discovery and the world's biggest, undeveloped high-grade copper discovery. The mine is anticipated to start production in 2017 with an operational lifetime of 30 years.

The concentrator will be designed to achieve 85.4% recovery at 32.8% Cu concentrate grade. Ore from the mine will be processed in a three-stage crushing circuit, and the primary and secondary ball mills will operate in closed circuit with hydrocyclones. Ore will then be delivered to the flotation circuit, which will consist of roughers and scavengers with a re-grind mill between the rougher and scavenger stages. Material from the flotation circuit will be cleaned in a cleaner circuit comprising cleaners, scavenger cleaners and re-cleaners. The final concentrate will be thickened before pumping to the concentrate filter and then on to the smelter.

The smelting process will include the use of direct to blister flash (DBF) smelting technology, wherein the copper concentrate will be processed by flash smelting to produce blister copper (98% Cu). The produced blister copper will be transferred for anode furnace treatment, which refines and casts them as saleable anodes.

Continuing with his green theme, Friedland stressed that zinc will find increasing importance in production of powerful fertilisers for food production, particularly in China and India. He talked about Ivanhoe's Kipushi Big Zinc zone, containing masses of extremely high-grade zinc. Ivanhoe now reports Big Zinc contains 10.2 million tonnes at 34.89% zinc. It is part of the wider Kipushi project in the DRC, where historic mining between 1924 and 1993 yielded 60 million tonnes grading 11% zinc and 7% copper.

During the lunch break I met Profs. Sue Harrison and Dee Bradshaw of nearby University of Cape Town. Sue is a consultant to MEI on Biohydromet '16, and Dee is MEI's "Living Gold" ambassador (posting of 11th January). This has been Dee's first Indaba, which she found very timely, as its strong themes of sustainability and innovation are two of her passions and core to her new role as Director of Minerals to Metals at UCT. She told me that the highlight of Indaba for her was to participate in the ‘Development Partner Framework' discussions and to meet and engage with some of the people who developed and wrote the material that helped her change the course of her career.

With Sue Harrison and Dee Bradshaw

My three days at Indaba ended with a walk to the Waterfront Harbour for a cocktail function hosted by SRK Consulting, where the company launched their four-decade anniversary book entitled "SRK: 40 years in the deep end", which captures the roller-coaster journey from SRK’s early days in 1970s South Africa to its global presence today.

With Vis Reddy, MD of SRK Consulting South Africa, Neal Rigby, Corporate Consultant in SRK North America,
Marcin Wertz, Partner and Principal Mining Consultant and
Andrew van Zyl, Partner and Principal Consultant (both SRK South Africa).

There is little doubt that 2016 will be a difficult year for mining, with companies preparing to weather an extended slump in mineral prices and unusually long mining cycles, but the general feeling at Indaba was that Africa has abundant opportunities for future investment. Although the weak Rand is attractive to foreign investors, South Africa's dwindling mining sector leads some to think that the potential lies in countries such as Namibia, Botswana, the DRC, Zambia and Zimbabwe, although drought has meant that lack of hydroelectric power from Kariba in the latter two countries is a serious problem.

As mining, the industry which feeds all other industries, is by its nature cyclical, even if the cycles are lengthening an upturn will eventually come about, so it will be interesting to see how fortunes have changed by next year's Indaba, which will be held in Cape Town from 6-9 February 2017.

MEI was just one of many media partners at Indaba '16 and this is in no way meant to be a comprehensive report on the conference. It is merely my diary of personal experiences over my three days at the Convention Centre. It would be impossible for an individual to take in everything that was happening at this extremely complex and well organised event, but the power of social media has been very much in evidence and a general overview of activities can be gleaned from the Twitter hashtag #MiningIndaba. I also invite all of you who attended this major meeting to add your own comments and views. What did you get out of African Mining Indaba '16; did it achieve its aims and objectives?

Twitter @barrywills