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Minerals Council South Africa setting out to boost local demand for green hydrogen
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Minerals Council South Africa is focused on increasing the domestic demand for green hydrogen, which it sees as contributing to the kickstarting of the hydrogen economy in South Africa.
"The applications that we're looking at are stationary as well as mobility applications of using hydrogen within the mining industry," Minerals Council modernisation and safety senior executive Sietse van der Woude outlined during last week's Hydrogen Economy Discussion covered by Mining Weekly.
"The stationary applications may not make economic sense today but if you look at the future trends in terms of reliability and electricity price trends, then stationary applications can very well be a feasible option in the future," Van der Woude pointed out during a panel discussion facilitated by Industrial Development Corporation of South Africa (IDC) industry development planner Mahandra Rooplall, and in which Science and Innovation Department chief science and technology representative Dr Rebecca Maserumule as well as Bambili Energy CEO Zanele Mavuso Mbatha participated.
Rooplall reported that the IDC had been driving the development of the hydrogen industry for several years in facilitating the discussion on regional and global developments, technology, original equipment manufacturer (OEM) advances and implications for the mining industry.
Van der Woude pointed out that when it came to mobility application, heavy mine trucks could not be powered enough by electric means.
"So, we need to look at alternative ways and the hydrogen fuel cell vehicles are an opportunity in that regard," he added.
In spelling out the hydrogen opportunity, Maserumule identified the six African countries that had hydrogen strategies as Algeria, Kenya, Mauritania, Morocco, Namibia and South Africa amid more than 50 countries worldwide having hydrogen strategies.
The projected global numbers for hydrogen production show seven-million tons of green hydrogen or its derivative being produced a year by 2030, 32-million tons by 2040 and 72-million tons by 2050.
Maserumule drew attention to this being based on expected exports into Europe and Asia, which did not have sufficient renewables or which did not have the comparative advantage.
Africa securing 15% of that market would amount to one-million tons of green hydrogen by 2030, seven-million tons by 2040 and just under 19-million tons by 2050, a part of which would be domestic consumption.
"What's most exciting is that those numbers point to a cumulative investment by 2050 of $400-billion on the African continent for hydrogen production," Maserumule highlighted.
This does not include OEMs and other portions of the supply chain.
The export value for the African continent would be a $15-billion-a-year increase in African export value in 2050.
"The most exciting socioeconomic benefit is the 30-million job years that will be created by 2050 on the African continent if the continent is able to capture 15% of the global hydrogen economy.
In identifying the barriers to that, Maserumule spoke of Africa having a globally top comparative advantage for renewable energy production, with only China, Australia and Chile beating most of the African countries.
But unlike grey hydrogen, which South Africa produces in large quantities, one of the challenges of green hydrogen production is the intensive capital expenditure (capex) that is required.
While the cost of coal or natural gas has a considerable impact on grey hydrogen, the capex required for renewables and electrolysers has a major impact when it comes to the cost of green hydrogen.
There is a considerable gap between the cost of investment in developed countries compared with the cost of development in undeveloped countries.
South Africa's average internal rate of return, or IRR, is well positioned at between 11% and 14%.
Being chased is the levelised cost of hydrogen, with grey hydrogen at $2/kg and -
Exceptional blue Cullinan diamond lifts latest Petra tender prices by 22%
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The sale by Southern African diamond mining company Petra Diamonds of an exceptional blue diamond in its fifth tender cycle lifted the average prices per carat received 22% higher than those of the prior Tender 4 sale.
The London Stock Exchange-listed company, headed by CEO Richard Duffy, reported on Tuesday that the price upliftment was the result of a remarkable14.76 ct exceptional clarity diamond, recovered from Cullinan diamond mine in Gauteng, fetching $8.2-million.
The Cullinan resource, which is famous for hosting the largest 3 106 ct gem diamond ever, has the potential to extend beyond 2050.
The fifth tender yielded an overall $49-million from the sale of 362 000 ct, with these proceeds more than offsetting the increase of quarter-three net debt.
Last month, the first of the 78-level second phase production tunnels at Petra's Finsch underground diamond mine in the Northern Cape was successfully commissioned. It is expected that the commissioning of the remaining six tunnels will be completed by June.
Production guidance of 2.75-million carats to 2.85-million carats for the 2024 financial year has been confirmed.
Petra reports that it is continuing to update its life-of-mine plans to support a transition to a smoother capital expenditure profile. This includes a replanned ramp-up of the deferred capital projects from the first quarter of the 2025 financial year.
The signing of a definitive transaction agreement for the sale of the Koffiefontein diamond mine in the Free State is expected to result in Petra avoiding closure-related costs of $15-million to $18-million.
The company has also announced an increased cost savings target of more than $30-million a year.
Half of these savings are expected to arise from a rebasing of fixed and variable costs in line with reduced throughput at Finsch, and the remaining half from savings across operating costs and overheads at group level and Cullinan.
During the quarter, Petra repaid $23-million of revolving credit facility finance to reduce interest costs. It had available liquidity of $104-million at the end of the quarter.
The average price of diamonds from Petra's Williamson diamond mine in Tanzania was lowered by reduced prevalence of higher-valued single diamonds, which is expected to be temporary in nature.
Petra's strategy is to focus on value rather than volume production and only operates in countries that are members of the Kimberley Process.
The company aims to generate tangible value for each of its stakeholders, thereby contributing to the socio-economic development of its host countries and supporting long-term sustainable operations to the benefit of its employees, partners and communities.
The company's loan notes due in 2026 are listed on the Irish Stock Exchange. -
Odds-on entry of palladium, platinum into EVs highlighted by research update
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New York- and Toronto-listed Platinum Group Metals, which is emerging in South Africa's Waterberg, on Tuesday provided an update on its new light battery technology that points to increasing potential of palladium and platinum playing a key energy density and weight-lowering role in cumbersome battery electric vehicles (BEVs), where they currently play no part.
Amid the market development of platinum group metals (PGMs) being collectively emphasised by South Africa's PGMs mining industry in unprecedented fashion, Platinum Group Metals restated its goal of this year creating prototypes for commercialisation consideration this year.
Intensive market development to support the use of palladium and platinum in lithium battery applications is embodied in Lion Battery Technologies, which Platinum Group Metals founded in partnership with South Africa's Johannesburg Stock Exchange-listed Anglo American Platinum.
Lion's restated target is to develop batteries with specific energies that are 20% to 100% higher than current technologies while meeting or exceeding their present cycle lives.
The possibility of creating additional demand for platinum and palladium in the battery technology space is of significant potential strategic importance for South Africa's PGMs mining industry.
Lion Battery with Florida International University is advancing the programme that uses platinum and palladium to unlock the potential of lithium air and lithium sulphur battery chemistries to increase their discharge capacities and cyclability, which is poised to result in their widespread potential use in BEVs.
Moreover, Lion has engaged the Battery Innovation Center in Newberry, Indiana, to help accelerate commercialisation efforts for its next generation platinum and palladium based battery chemistries.
The Battery Innovation Center's scope of work is to conduct independent small and large scale trials to validate Lion's proprietary platinum and palladium based electrode composition, slurry, and films in both lithium sulphur and lithium-ion cells.
"Can we increase the energy density? Yes, we can," Lion Battery Technologies lead researcher Dr Bilal El-Zahab stated during a presentation, which is recorded on video on the website of Platinum Group Metals.
"EVs, that will need the battery, you are going to need the battery to be light and pack as many kilowatt hours per kilogram as possible into the battery.
Catalysts based on PGM nanoparticles offer a potentially rapid solution to many of the current battery problems and have been shown to improve the performance of the batteries.
WATERBERG PROJECT
In reporting its financial results for the six months ended February, Vancouver-based and Johannesburg-linked Platinum Group Metals, headed by CEO Frank Hallam, reiterated its focus on advancing the Waterberg Project located on the Northern Limb of the South Africa's PGM-rich Bushveld Complex in South Africa.
The project is being planned as a mechanised, shallow, decline access palladium, platinum, gold and rhodium four-element mine and near-term objectives are to advance it to a development and construction decision.
Waterberg JV Resources in April approved a $1.35-million stage-four budget to allow the continuation of work programs underway while the update to the definitive feasibility study is finalised.
The stage-four budget, covering the period from March to August, is a subcomponent of an approved two-year $21-million pre-construction work programme.
A cooperation agreement has been reached with Ajlan & Bros Mining and Metals to study the establishment of a stand-alone PGM smelter and base metal refinery in Saudi Arabia.
The study will seek to identify potential global sources of PGM concentrate that could augment the processing of the Waterberg Project concentrate in Saudi Arabia and minimise the risk of sourcing concentrate from only one project.
The Japan Organisation for M -
PGM market development has paid dividends, could pay many more, Platinum Day told
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The market development aspect of the platinum group metals (PGM) industry is fundamentally key, it was repeatedly stated at last week's 2024 Resources for Africa Platinum Day.
There is strong consensus that PGMs are amazing metals that are incredibly useful as future green metals across a broad range of applications.
The PGM elements platinum, palladium, rhodium, ruthenium, iridium and osmium possess far-reaching physical and chemical characteristics that make them sought after by modern technology developers.
"If I could turn back the clock, I would've probably recommended to the board a far stronger investment in market development. Every dollar we invest will have a fundamental return long-term," Implats CEO Nico Muller commented in conversation with chairperson Bernard Swanepoel at the event covered by Mining Weekly.
"I'm encouraged that people are now starting to talk a lot about market development," Anglo American Platinum CEO Craig Miller commented in his conversation with Swanepoel.
"We need to do market development on the full basket and not just platinum and palladium and ensure that it's PGMs that underpin clean hydrogen in the lowest cost-plus way," Sibanye-Stillwater CEO Neal Froneman stated in the opening address.
"These are really important metals. They're really special in terms of what they do. In many applications across the world, they are essential for human existence," Northam Platinum CEO Paul Dunne highlighted.
"It's important that we give huge focus to the PGMs industry, which 2023 numbers show is the largest employer that spends the most on community development and contributes 10% of total exports to South Africa," Minerals Council South Africa CEO Mzila Mthenjane pointed out.
Meanwhile, as was reiterated at the event, platinum demand is returning to help solve the PGM basket problem, and a supply decline is effectively already happening.
It is not anticipated that prices will necessarily go back to where the industry had previously experienced them owing to drivetrain electrification and additional supply potentially coming to the market through recycling.
The widespread outlook is that because the industry is going through a structural change it should not rely too heavily on traditional price recovery and there is consensus that market development catch-up, particularly in the hydrogen space, must take place.
Mentioned frequently as one of the pivotal market developers is PGM-promoting and South Africa-linked venture capital company AP Ventures, created together with the Public Investment Corporation of South Africa.
AP Ventures has been recognised as the most active investor in hydrogen beginners globally by the Mind the Gap: Venture Funding of Hydrogen Start-ups report by H2UB and after visiting a Texas company in which AP Ventures is associated, Microsoft luminary Bill Gates had this to say: "The energy transition is happening faster than many people (including me!) dared hope."
In March, AP Ventures announced its investment in the pre-seed investment round of UK-based direct air capture company Airhive, co-leading the round alongside Coca-Cola Europacific Partners.
Airhive is developing a low-cost, energy-efficient and rapidly scalable technology to capture carbon from the atmosphere. This pre-seed round will support its technology development and the delivery of its second commercial pilot, which will be deployed later this year.
Anglo American Platinum expects prolonged deficits in platinum, a surplus in palladium and a rhodium market to move back into balance in 2024.
The original equipment manufacturer stocking, which took place during Covid, the microchip shortage and then the invasion of Ukraine, has been considerably destocked.
"It's clear that the market has bottomed out in the last six months," said Muller.
Fundamental deficits are being predicted along with a tightening market.
"I'm not expecting price -
Internal combustion engines are not going anywhere, says Northam's Dunne
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Platinum group metals (PGM) miner Northam Platinum CEO Paul Dunne firmly believes internal combustion engines (ICEs) are here to stay for the foreseeable future, which, in his view, will mean salvation for PGM miners that are struggling to remain profitable amid sustained low commodity prices.
"The world is getting over the love affair with electric vehicles. There's no question about that. It certainly will not be a replacement for the ICE. However, it's capturing some market share, but ICEs will have a longer life and the lower metal requirement will be balanced by natural depletion," he said at the PGMs Industry Day, in Johannesburg, earlier this week.
He explained that the automotive market remained the most important market for PGM producers.
"If the economics are what they are today, the natural economic depletion will be accelerated by an economic overlay. That's what we expect to happen. So the market will be rebalanced on supply. We haven't lost the PGM market," he said.
He noted that continued production was clearly not sustainable at current prices and that, eventually, either supply or price would have to cave.
"You can't have both. You can't have this rand basket price and this production. They will not equate. Something has to give.
"Two things can happen to correct this imbalance. One is that production comes off or, two, prices recover. There may be some sort of combination in between," he posited.
However, he noted that the problem was too big to be solved by simply "squeezing the lemon" and structural change was needed.
"We acknowledge there has been structural change in China, which remained quite closed for a long time. When we finally got there, we were quite shocked at the developments in China in terms of what is happening in the automotive industry. They're going to be highly competitive against the rest of the world," Dunne said.
He said western car manufacturers and joint ventures were already suffering in terms of market share, as China has begun to export its cars, as has already been seen in South Africa.
"I think you'll see more and more Chinese brands. They're at a reasonable quality and a very attractive price point. This presents a great challenge to the traditional North American, and more so European original-equipment manufacturers in the automotive industry. We see a threat to the traditional structure of the overall automotive industry," Dunne explained.
He noted that, of the PGMs, palladium was most under pressure from a fundamental point of view. However, while palladium appears to be performing weaker than other PGMs the recent shortage of the metal means that there is no legacy stock.
"It also has a big short position sitting against it, which is somewhat positive, so palladium can recover. However, in the longer term, we think palladium is under a lot of fundamental pressure," Dunne said.
On the other hand, however, he expected platinum to be the PGM that could be the saving grace for PGM miners.
"Platinum can actually solve this problem for the miners. Otherwise, supply must come off. I've got no doubt. A supply drop off is effectively already happening. It's been happening for years," Dunne said, noting that South Africa produced about 5.5-million ounces of platinum at one stage and that current forecasts are for production to only reach about three-million ounces this year.
"The capacity of the orebodies in the country to produce has been eroded through a combination of lack of investment, reinvestment and natural depletion," Dunne said.
He said he believed in the importance of PGMs and urged industry players to work together to rebalance the market to ensure its survival.
"These are really important metals. They are really special in terms of what they do. In many applications across the world, they are essential for human existence. We've got an industry. We've got a market. We need to rebalance o -
Martin Creamer discusses: hydrogen, PGMs and underground mine energy storage
In this week's episode of Second Take, Mining Weekly Editor Martin Creamer discusses hydrogen’s role as a global energy solution; the market development of the full PGMs basket being essential; and about how South Africa’s underground mines could be used as batteries that store energy.