Posted on :Monday , 11th September 2017
Many governments in Africa have made major progress over recent years – we now see mining companies working hard to ‘put back’ in to society through skills development and environmental protection policies. The African mining industry has matured.
Kenya’s 2016 mining act, which forms part of its 20-year mining strategy, specifically sets out the country’s aim of attracting up to 20 new mining companies.
The act provides simplified permits for small-scale operations and simplified licenses for larger companies.
And, on the other side of the continent, we are seeing similar moves to incentivise investment - the Angolan government is currently working on a new special tax regime for the sector, which may include new incentives concerning tax deductible costs and losses.
Commodity prices are an important factor today. After several years of unstable, low prices, the World Bank forecasts a $5 increase in the PPB in 2018. Its April 2017 Commodity Markets Outlook report also forecasts that metal prices will rise by 16% by the end of 2017.
We are also now seeing opportunities to invest increase right across the continent, including in Angola, Ghana, Kenya, Mauritania and Senegal.
The Angolan Ministry of Geology and Mining confirmed in February 2017 that it had secured funding for the Angolan National Geology Plan (Planageo), which is described by the Minister of Geology and Mining, Francisco Queiroz, as “The main instrument of the government’s strategy for protecting the geology and mining sector.”
The plan has already identified over 200 priority targets for the prospecting of iron, base metals, copper, manganese, titanium, gold, lead and aluminium (amongst others).
Despite the positive news, challenges remain. Illegal mining is one of them. In 2016, Ghana lost $2.3 billion in revenue due to illegal mining and it continues to be a major issue in South Africa.
And, as commodity prices rise, the problem will worsen – unless governments and other stakeholders address the problem head-on.
The South African government has identified illegal mining as a national threat, with illegal syndicates employing around 30 000 people many of whom are illegal immigrants.
The issue is not only a threat to the industry and national economies but to the health, safety and well-being of those working in unsafe mines with poor access to basic services – even clean drinking water.
Infrastructure is often poor, working conditions usually dangerous and salaries are low. Women can earn as little as R100 per day in South Africa by grinding up a 20-litre bucketful of rock. Often, workers are paid in kind, taking a tiny percentage of the takings or leftover soil.
In addition to the need for greater levels of policing and law enforcement, is the need for sustainable mining practices, right across the value chain.
Support services are a crucial element – access roads, potable water services and operation and maintenance facilities provide for resource optimisation, a better quality of life for workers and safer working conditions.
Of these, health and safety is one of the most important day-to-day operational objectives, which is why third-party companies such as RA International are increasingly becoming important logistical partners.
RA International provides life support, facilities management and health and safety services to mining companies in some of the most challenging terrains, including right in the heart of the desert.
The company’s expertise includes the delivery of fully functional, remote and self-sufficient prefab camps in the middle of the desert to the north of Khartoum – these mega-projects require the laying out of roads and waypoints, life-support facilities, accommodation and maintenance for hundreds of people.
Creating safe, comfortable camps that place health and safety at the core of every logistical decision taken is also important in meeting the various legal and regulatory HSE requirements.
Kenya’s 2016 Mining Act spells out important sustainability and environmental policies; which include technology transfer, local equity participation, labour laws and incentives on local investments.
This is an attempt to strike the right balance between deregulation and environmental and social protections.
If mining in Africa is to grow responsibly – and if all Africans are to benefit from the wealth generated from the continent’s natural resources – mining companies must adopt and enforce sustainable practices.
Companies must take personal responsibility for the natural environment they operate in, and respect the health and well-being of those working for them – often in very difficult conditions.
Mining companies can also benefit from partnering with specialised logistics, life support and maintenance companies that are able to rapidly deploy teams of experts that understand the local communities.
Such companies can set the highest standards of excellence – including in compliance, industry best practice and social responsibility.
Responsible energy and water management, innovative approaches to community engagement and compliance with health and safety regulations are crucial in commercial success and the development of a sustainable mining sector.
The journey towards achieving environmental accountability, social responsibility and commercial success will help to prevent illegal mining and inevitably lead to more foreign investments.
Sustainable practices through investment in on-site facilities, infrastructure, training, safety and the environment will raise standards across the value chain in Africa – which is good for the industry, for economic growth, sustainable jobs and the millions of people working to build a better future for their families and communities.