WATERBERG DISTRICT MUNICIPALITY
MINING DEVELOPMENT STRATEGY
PHASE ONE AND TWO: POLICY AND CURRENT
SITUATION ASSESSMENT
DISCUSSION DOCUMENT
GLEN STEYN AND ASSOCIATES
3 FEBRUARY 2006
TABLE OF CONTENTS
1.
PURPOSE AND BACKGROUND
3
2.
2.1
2.2
2.3
2.4
2.5
2.6
2.7
2.8
2.9
2.10
POLICY ASSESSMENT
Mineral and Petroleum Resources Development Act
Mining Charter
Limpopo Growth and Development Strategy
Limpopo Mining Strategy (Draft)
Integrated Development Plan for WDM
Local Economic Development Plan for WDM
Spatial Development Framework for WDM
Marketing & Investment Strategy for WDM
IDPs and LEDs for Local Municipalities in WDM
Case Studies of International Best Practice
4
4
4
5
8
11
16
17
17
20
21
3.
3.1
3.2
3.3
3.4
3.5
3.6
CURRENT SITUATION ASSESSMENT
Geological Overview
Economic Geology
Current Mining Operations
Mining in the District Economy
Opportunities for Expansion
Business-as-Usual Scenario for Mining in WDM
23
23
24
30
33
35
36
4.
CONCLUSION ON PHASE ONE AND TWO
38
ANNEXURE
ANNEXURE
ANNEXURE
ANNEXURE
ONE: MAP OF MINING ACTIVITIES IN WDM
TWO: DIAGRAM OF THE COAL CLUSTER
THREE: DIAGRAM OF THE PGM VALUE CHAIN
FOUR: GEOLOGY MAP OF WATERBERG DISTRICT
40
41
42
43
2
1.
PURPOSE AND BACKGROUND
The purpose of this strategy formulation process is to provide WDM with a policy
instrument by which leadership and strategic direction can be given to the mining
industry for:
 Increased competitiveness on a sustainable basis,
 Increased investment as a basis for job creation and economic growth,
 Improvements in the quality of life of the district population, including
priorities such as BEE, as well as reductions in HIV/AIDS and poverty,
 Regional integration.
This mining development strategy is part of a broader intervention that is aimed at
accelerated economic development in Waterberg District.
The mining development strategy will be compiled in the following five distinct
phases:
 Policy Assessment
 Current Situation Assessment
 Scenario Analysis
 Project Development Opportunities, and
 Implementation Plan.
The policy and current situation assessments are presented in this report as a
discussion document. It will be formalised once comments from stakeholders have
been received.
Report Two will deal with the results of the scenario analysis and is scheduled for
release as a discussion document at the end of February 2006. Report Three will
cover project development opportunities as well as the implementation plan and
this will be released as a discussion document at the end of March.
All three reports will be consolidated into a final strategy document once
stakeholder comments have been received.
3
2.
2.1
POLICY ASSESSMENT
Mineral and Petroleum Resources Development Act
The object of the Minerals and Petroleum Development Act, No. 28 of 2002, is to
make provision for the equitable access to and sustainable development of the
nation’s mineral and petroleum resources; and to provide for matters connected
therewith, such as prospecting and mining and rights and permits.
The Act recognizes the following principles:
 That the country’s mineral and petroleum resources belong to the nation and
that the State is the custodian thereof
 Mining can and should contribute to economic growth and job creation
 There is a need to promote the local and rural development and the social
upliftment of communities affected by mining
 The State should be committed to eradicating all discriminatory practices in
the mining and petroleum industries
 The State should endeavor to bring about equitable access to South Africa’s
mineral and petroleum resources, particularly for historically disadvantaged
persons
 The nation’s mineral and petroleum resources should be developed in an
orderly and ecologically sustainable manner
 Holders of mining and petroleum rights should contribute towards the
socio-economic development of the areas in which they are operating
 Security of tenure should be provided in respect of prospecting, exploration,
mining and production operations.
The Municipality has no jurisdiction over the administration and granting of mineral
rights but it does have the right to be consulted on each application that will affect
the Waterberg District. It is therefore imperative that a good working relationship
should be established between WDM and the DME Regional Manager in Limpopo.
The municipality is also obliged to facilitate the economic and mining development
processes by building networks and promoting good working relationships between
various institutions in the sector, such as private companies, parastatal
development organizations and public infrastructure agencies.
2.2
Mining Charter
The Broad-Based Socio –Economic Empowerment Charter for the South African
Mining Industry is an agreement drawn and entered into by the social partners in
the mining industry which seeks to redress the imbalances that existed and still
exist in the mining industry. The Charter is a way in which the social partners
commit themselves to the implementation of the relevant provisions of the
Constitution and the Mineral and Petroleum Development Act which also aim to
redress historical social and economic inequalities.
The charter should also be read and applied in relation to the following pieces of
legislation:
 The Preferential Procurement Framework Act
 Supply Chain Management Act
 The Competition Act
 The Skills Development Act.
4
The signatories to the charter have committed themselves to substantial
improvements in literacy, numeracy, as well as skills training within the mining
industry. Targets to achieve 40% HDI participation in management and 10%
participation of women in mining by October 2007 were also agreed upon. Thirdly,
signatories undertook to remove all discrimination against foreign migrant labour
and to improve the standard of housing for mine employees. A progression of
procurement from historically disadvantaged South African (HDSA) companies was
accepted. Mining companies also agreed to achieve 26% ownership of mining
assets by HDSA companies before October 2012 and to assist these companies in
raising finance for this purpose. Finally, all signatories agreed upon a scorecard for
the regular reporting of progress.
WDM has an important role to play in promoting the stake of historically
disadvantaged companies that are based in Waterberg District within the targets of
the charter.
2.3
Limpopo Growth and Development Strategy
2.3.1 Competitive Clusters for Growth and Development
One objective of the Limpopo Growth and Development Strategy is to increase
economic growth at a rate that will raise the contribution from Limpopo towards
national wealth creation from 6.5% in 2001 to 9% by 2010 and to 12% by 2020.
The relevant strategy is to adopt the development cluster value-chain approach, as
a vehicle to raise the international competitiveness and investment rating of the
Province, to combine public and private sector contributions to development and to
align the interventions of various public development institutions for greater
impact.
Clusters are critical masses, spatially concentrated and of unusual competitive
success in a particular field. They encompass an array of linked industries, from
suppliers and providers of infrastructure to down-stream activities and service
organisations. They also include training, research and governmental institutions.
Competitive advantage within these clusters is driven not so much by the source
and cost of inputs as by the productive use of inputs, which requires continuous
innovation.
Middle and low-income countries have traditionally competed in the world market
with cheap labour and natural resources. In order to move beyond this stage, the
development of well-functioning clusters is essential.
Promoting cluster formation will require policy attention to issues such as:

Improving education and skills;

Provision of essential infrastructure;

Building capacity in technology;

Opening access to capital markets, and

Improving institutions / institutional efficiency.
Once a cluster begins to form, a self-reinforcing cycle promotes its growth.
Clusters improve competitiveness by increasing productivity, by driving the
direction and pace of innovation and by stimulating the formation of new business.
It is therefore, the perfect context, within which to develop a strategy to promote
5
economic growth, to create sustainable opportunities for local economic
development and SMMEs; and to offer acceptable returns for investments in
development.
Two of the seven competitive clusters for Limpopo that were identified and
approved in the Provincial Growth and Development Strategy fall within the mining
sector of Waterberg District. These are the platinum and coal mining clusters with
their associated value chains and extracts from the PGDS for these clusters are
provided below.
2.3.2 Approved Mining Clusters for Waterberg District
Platinum Group Metals Mining Cluster
Anchor projects for this cluster will be the existing and new platinum mines and all
the up-stream development potential that emerges from this.
Up-stream
development potential includes the establishment of local suppliers for mine
purchases, as well as business to provide the shopping needs of the work force.
Down-stream activities refer to the smelter that has already been constructed in
Polokwane with the potential for expansion, as well as a refinery that is envisaged
in the future.
Public sector interventions to improve the competitiveness of this PGM cluster
include the upgrading of access roads, water source development, education and
skills development with specific reference to the mining sector and improved
service delivery for residential development around the mines.
A map is provided in Annexure One that reflects the location of existing and future
mining and mineral processing activities. It provides a useful starting point for the
mining cluster planning process.
Coal Mining and the Petrochemical Cluster at Lephalale
Proposals have been developed to expand the existing Grootegeluk Coal Mine and
the power station and also to build an aromatics extraction factory, which will form
the core of this cluster. The factory will be fed with chemical grade coal from
Grootegeluk Mine. A wide range of down-stream opportunities exists in the
styrofoam, plastic, nylon and rubber product industries. A memorandum of
understanding for the compilation of a feasibility study has been signed between
Kumba Resources (Grootegeluk Mine) and Limpopo Province.
Public sector interventions include approval for the expansion of the power station,
water source development, education and skills development with specific reference
to the chemical industry, and a rail link to Richards Bay in the long term. Annexure
Two reflects the existing and proposed future developments pertaining to the Coal
and Petrochemical Cluster.
In practical terms, it means that the value-chains of the following potential mining
development clusters have to be analysed. It should be noted, that these are by no
means the only potential clusters within the various Districts. Other development
clusters should also be identified and promoted over time, but it is important to
start with a manageable number in order to achieve the momentum required to
extend the value-chains of each cluster.
6
2.3.3 Methodology for Cluster Value Chain Analysis
The following methodology was adopted for the analysis of the cluster value-chains
in Limpopo.
1.
Illustrate the cluster value-chain graphically with the main production activity
in the center. Quantify the economic value and impact of the current main
activity. Illustrate and quantify the existing links up-stream, in terms of
inputs and services to the main production activity, and down-stream, in
terms of value-adding activities.
2.
Identify opportunities for new production, expansion of existing production
and for efficiency improvements along the value-chain. Illustrate links with
neighbouring provinces and countries.
3.
Ring fence opportunities for SMME and for poverty reduction within the
cluster development opportunities identified in step two above.
4.
Identify infrastructure and logistical improvements that could increase the
competitiveness of the cluster value-chain.
5.
Identify skills development and institutional improvements that could
increase the competitiveness of the cluster value-chain.
6.
Illustrate the entire cluster value-chain in GIS format.
7.
Incorporate the cluster value-chain and its development opportunities
(investment, SMME, poverty reduction, infrastructure, as well as skills and
institutional development) in the district and municipal IDPs.
8.
Reflect the role of national and provincial departments regarding each cluster
value-chain in the departmental strategic plans and budgets.
9.
Prepare and implement business plans for each opportunity as part of the
district and municipal LED processes. (This will be discussed in report 3).
10.
Establish a mechanism to monitor the progress and development impact of
each cluster value-chain.
Cluster value-chain analyses were at an advanced stage by August 2004 and
were discussed with provincial departments, districts and municipalities.
During this time some work was completed on the PGM value chain, which is
reflected in Annexure Three. These analyses also formed the basis for Sector
Summits that were held between August – September 2004, involving
private sector participants in the agriculture, mining and tourism sectors.
The competitive cluster value-chain approach has been adopted and is
supported by all stakeholders. The following resolutions were taken to
inform the way forward:
7
2.3.4 Resolutions of Development Summits
General resolutions
 Working groups comprising government, labour and business should be
established for each of the proposed cluster value-chains, in order to
accelerate the cluster development process.
Relevant districts and
municipalities should be represented on the cluster working groups.
These cluster working groups should have access to project management
capacity and should be co-ordinated by an executive provincial cluster
working group;
 Infrastructure, including water, transport, electricity and ICT should be
upgraded to improve integration, productivity and competitiveness within
and across each cluster;
 Education and training institutions should provide skills development
programmes that contribute to improved productivity and competitiveness
within each cluster;
 Research and development should be increased to promote new product
(opportunity) development and to improve competitiveness of the
proposed clusters;
 Investment promotion, LED project identification and provincial marketing
should reflect the cluster priorities;
 Business plans are required for each new development opportunity within
every cluster and these business plans should reflect the issues raised
above, as well as the proposed project contribution to job-creation, to
SMME promotion, to gender issues and to
BEE;
 These business plans should be incorporated into departmental strategic
plans and IDPs at the district and municipal levels, and
 In anticipation of the financing strategies that will have to be part of the
business plans, a workshop is required to identify and deal with the issues
that constrain access to finance in all sectors and across the entire
spectrum of business activity from SMME to major corporate projects. The
entire spectrum of financing institutions would therefore, need to
participate in the workshop and in its resolutions.
Specific Mining Summit resolutions
In addition to the generic resolutions above, the National Mining Charter and its
seven major elements will provide the policy framework for mining development.
The target is to eradicate illiteracy by 2009.
Accommodation should be
transformed from hostels to homes. Finally, a premium will be placed on
exploration to discover new mineral reserves and to identify new mining
opportunities.
WDM is likely to make more progress by leading the way in terms of the value
chain planning and development processes, rather than to wait for the provincial
government to complete the process for all the clusters.
2.4
Limpopo Mining Strategy (Draft)
2.4.1. Introduction
Currently Limpopo has not compiled an official mining strategy but plans are in
place to develop one in the near future. This document outlines some of the main
features that are likely to appear in such a strategy. The PIDS (Provincial Industrial
Development Strategy) is guided by the national industrial development policy,
8
which emphasises among others, a move away from primary natural resource
orientation to value addition and beneficiation, information and innovation; spatial
development initiatives around economic clusters, employment equity and black
economic empowerment and finally, transforming the South African economy to
redress past legacies of inequality.
Limpopo is abundantly endowed with natural resources; particularly minerals and
flora. The substantial mining operations do not contribute significantly and directly
to the upliftment of the citizens of the province. In addition the raw materials from
these resources are exported without adding much value, hence leaving the
province poorer than it could be. Owing to significant investments in the province,
mainly from mining, the economic growth of the province in 2001 was 6.8%, which
is well above the national average. This growth has, however, not translated into
the creation of jobs in sufficient numbers that are so desperately needed to sustain
livelihoods.
2.4.2 Strategic Considerations
A two pronged strategy for enhancing the quality of life in the province, namely,
wealth creation and poverty alleviation, is required. Many discussions have taken
place on procurement related to mining, mining operations, beneficiation and value
addition. Most of the inputs to the mining operations are provided by suppliers
residing outside the province. It will be beneficial if some of the suppliers can
relocate to the province and create partnerships with local business especially the
BEEs. It is further essential to establish downstream and secondary industries in
the mineral value chain; which will remain functional and productive long after the
mines have ceased to operate, thus providing job opportunities and avoiding ghost
towns.
At the center of these activities is the need to create jobs and acquire skills at
appropriate levels, which will match these tasks. Hence, capacity for development
of such skills is essential. Furthermore, beneficiation is substantially underpinned by
research and innovation, implying the necessity of expertise in high level training.
Such training involves extensive mentoring, development of human resources and
research infrastructure. However the Limpopo province is disadvantaged in this
regard, since it has low capacity for generating sophisticated skills at short notice.
In addition investment in training, research and innovation has been minimal. In
2001, the expenditure on research and development in the province was 1.3% of
the national allocation, when in terms of its population and size the province
commands 10%. This under funding has persisted over several decades and has
created a significant deficit in terms of research infrastructure and expertise
residing in the province. Furthermore, lack of adequate research infrastructure
makes it exceedingly difficult to attract and retain suitable human capital in the
province. It therefore becomes imperative to implement strategies that will correct
these anomalies. An interface with national strategies such as the small scale
mining initiative, integrated manufacturing strategy, as well as the national
research and development strategy, should be created.
9
2.4.3 Considerations for Implementation
The rollout of the mining clusters for purposes of creating jobs involves an analysis
of their respective value chains. Activities that are prominent in mining value chains
to unlock the potential of job creation are discussed below.
Exploration is the entry point and it commences with appraisal and assessments of
mineral occurrences in the province. This is followed by techno-economic studies
and adaptation, as well as development of appropriate extraction technologies, and
where necessary involving test work at laboratory to pilot level. Mine planning
follows and will assist in compiling a comprehensive business plan which could
facilitate acquisition of funding. This sets the scene for the mining stage, which
encompasses mining inputs, mining operations, mining outputs, beneficiation of
raw materials and value addition entailing establishment of industries that produce
manufactured goods out of raw materials or other associated secondary industries.
The execution of plans will involve local and provincial governments, with the
provision of basic infrastructure and inputs aligned with their economic planning.
The Department of Minerals and Energy could facilitate the plans in accordance with
the execution of the Mining and Petroleum Resource Development Act (MPRD) and
various national departments could lend support in line with their strategies.
National laboratories such as Council for Geosciences (assessment of occurrences),
Mintek (techno-economic studies and extraction technology) and CSIR Miningtek
(Mining design) could play a significant role in collaboration with local tertiary
institutions in building capacity in these areas. The latter play an important role in
human resource development through skills training by offering certificates,
diplomas and degree programmes. Value addition to raw materials will be a
collaborative effort of the institutions above, where research, innovation and
postgraduate training could be pursued. Collaboration with other institutions locally
and internationally could facilitate skills and technology transfer and capacity
building.
The plans for each mineral cluster will unfold differently with resources provided
judiciously at various stages of the value chain to optimize job creation. However,
the rollout of the plan could be piloted with selected minerals.
The Mining strategy cannot operate in a vacuum in the province and will have to be
aligned with the activities of the other lead sectors. The role of digital databases
linked to a spatial system through a GIS will be useful in facilitating co-ordination.
Mining is capital intensive and can justify substantial capital outlays in
infrastructure development in areas where little infrastructure existed before. Once
this is in place, other opportunities are created, such as transportation, water,
energy and power supply. From this provision, tourism and agriculture can be
introduced to localities adjacent to the mine, thereby creating economic
sustainability after the mining reserves are depleted.
10
2.5
Integrated Development Plan for WDM
The following four tables were extracted from the analysis section of the IDP for
WDM. They provide information on the potential for three classes of minerals per
local municipality and on the operating mines in the District. The three mineral
classes are precious metals, ferrous and base metals, as well as industrial minerals.
All local municipalities have some mineral potential, although it is relatively less in
Mookgopong and Modimolle.
Some of the mining projects on the list in table four, such as coal liquefaction at
Lephalale, are still in the planning stage.
Economic objectives for mining in the IDP are to ensure economic growth of 5% in
sector over the next five years, but no figure is provided to indicate the size of the
sector as reference point for 2005. The strategies contained in the IDP to achieve
this objective are to create awareness about mining opportunities, to identify
support programmes for mining co-operatives and to promote SMMEs in mining
through the provision of incentives.
The two economic development projects for the mining sector that are contained in
the IDP are the recycling of coal ash for brick block manufacturing and the
establishment of a pebble co-operative.
11
TABLE 2.5.1: PRECIOUS METALS AND DIAMONDS PER LOCAL MUNICIPALITY
MUNICIPALITY
MINERAL
LOCATION
DEPOSIT
CORRIDOR
NAME
STATUS
STATUS
Bela-Bela
Gold
Plat river
Small scale
Outside the 50
km radius of the
Diamonds
Mackenzie
Sufficient
East-West
(Kimberlite)
corridor, within
the
20
km
radius of the
Trans-Limpopo
corridor
Modimolle
20 km radius of
the
TransLimpopo
corridor
Mogalakwena
Platinum
Platinum reef
Sufficient
Within the 20
Gold
Rebone
Small scale
km radius of the
Ga-Mathapo
Small scale
East-West
corridor
Mookgopong
Platinum
Swaershoek
Medium scale
50 km corridor
Mountains
area
Lephalale
Diamond
Swartwater
Large
and 50 km outside
(Kimberlite)
small scale
50 km radius
Thabazimbi
Platinum
Northam
Sufficient
Outside the 50
Gold
complex
Sufficient
km radius
Kaya se put Medium scale
Outside the 5o
(Madikwe)
km radius
Dwaalboom
Outside the 50
km radius
SOURCE: COUNCIL FOR GEOSCIENCE
TABLE 2.5.2: FERROUS AND BASE METALS PER LOCAL MUNICIPALITY
MUNICIPALITY
MINERAL
LOCATION
DEPOSIT
CORRIDOR
NAME
STATUS
STATUS
Bela-Bela *1
Modimolle *1
Mogalakwena
Mookgopong *1
Lephalale *2
Manganese
Copper
Tin
Cobalt
Silica
Manganese
Iron
Tin
Zirconium
Nickel
Vanadium
Tin
Titanium
Molybdenum
Chrome
Lead
Tin
Iron
Copper
Nickel
Thabazimbi
Iron
Nickel
Beryllium
Plat river
Modimolle
Modimolle/Vaalwater
Alma
Alma
Witkop
Droomdlea
Along the N11
Tin mines
Waterberg mountains
Tin mines
Chrome mines
Vlakfontein/Uitgedaght
Swaerhoek Mountains
Kauletsi
Tom Burke
Kauletsi/
Glenover/Rosedale
Doornfontein
Thabazimbi
Northam
Rooibokkraal
Small scale
Small scale
Small scale
Small scale
Sufficient
Small scale
Small scale
Small scale
Small scale
Sufficient
Sufficient
Sufficient
Small scale
Small scale
Sufficient
Small scale
Sufficient
Small
Small
Small
Small
Small
scale
scale
scale
scale
scale
Sufficient (CPR)
Sufficient
Small scale
Outside the 50 km
radius.
Outside the 50 km
radius.
Within a 20
radius
Core of the SDI
Within the 20
radius
Within the 20
radius
Within the 20
radius
Within the 50
radius
Within the 50
radius
Within the 50
radius
Within a 50
radius
Outside the 50
radius
Within the 50
radius
Outside the 50
radius
km
km
km
km
km
km
km
km
km
km
km
Outside the 50 km
radius
Outside the 50 km
radius
Outside the 50 km
radius
SOURCE: COUNCIL FOR GEOSCIENCE 2002
NOTES: *1 Municipalities within the Springbok Flats
*2 Municipality within the Waterberg/Ellisras coal field
13
TABLE 2.5.3: INDUSTRIAL MINERALS PER LOCAL MUNICIPALITY
MUNICIPALITY
MINERAL NAME
Bela-Bela*1
Lime stone
Calcite
Sandstone
Refractory clay
Fluorspar
Modimolle*1
Silica
Kieselguhr
Fluorspar
Barytes
Phosphate
Granite
Chrysotile
Brickclay
Lime stone
Andalusite
Flourspar
Fluorspar
Sandstone
Granite
Refractory clay, Marble,
Phosphate,Topaz &Feldspar
Mogalakwena
Mookgopong*1
Lephalale *2
Thabazimbi
Attapulgite
Lime stone
Vermiculite
Barytes
Crocidolite
Andalusite
LOCATION
DEPOSIT STATUS
CORRIDOR STATUS
Radium
Rust de Winter
Eersbewond
Buyskop
Eersbewood
Platriver
Kleinnood
Keespoort
Keespoort
Glen Alpine
Setateng
Kaditshwene
Matlala
Zebediela road
Zebediela road
Drommondlea
Marken
Vlakfontein
Vlakfontein
Columbia
Onverwaght
Small scale
Sufficient and small scale
Sufficient
Medium scale
Sufficient
Outside the 50 km radius of the corridor
Sufficient
Small scale
Small scale
Sufficient
Medium scale
Sufficient
Medium scale
Medium scale
Small scale
Small scale
Small scale
Small scale
Sufficient
Medium scale
Outside the 50 km radius
Atherstone
Swartwitpenbok-fontein
Rooibokkraal
Morongwe
Berg van winde
Ferrogate
Medium scale
Medium scale
Small scale
Small scale
Small scale
Sufficient
20 km of both the East-West and TransLimpopo
Within 50 km radius of the East-West and of
Trans-Limpopo
Outside the 50 km radius of the East-West and
Trans-Limpopo
Outside the 50 km radius of East-West and
Trans-Limpopo
SOURCE: COUNCIL FOR GEOSCIENCE SAMINDABA (SOUTH AFRICAN MINERAL DEPOSIT DATABASE 2002)
NOTES: *1 Municipalities within the Springbok flats coal field
*2 Municipality within the Waterberg/Ellisras coal field
TABLE 2.5.4: MINING PROJECTS ALONG THE EAST-WEST CORRIDOR
PROJECT NAME
PRE INVESTMENT
ACTION
COST
R’000
INVESTMENT
R’000
PPL Mine
Done
N/A
350 000
ESTIMATED
NUMBER OF
JOBS
250
Amandelbult
Grootgeluk Colliery
N/A
N/A
202 000
150 000
200
100
Coal Liquefying Project
Done
Feasibility study
Ongoing
Feasibility study
500
150 0000
Platreef Project
Feasibility study
60 000
Vanadis Project
Done
Haaspan Granite
LOCATION
DESCRIPTION
Overysel 815 LR
Vaalkop 819 LR
(Mokopane)
Northam
Lephalale
Expansion of
open pit mine
300
Waterberg coalfields
(Lephalale)
130 0000
800
N/A
54 000
350
Feasibility study
30
25 000
80
Done
N/A
500
200
Drenthe 778 LR
Awaitrivier
777
LR
(Mokopane)
Molendraai
(Mapela)
Haaspan
(Bakenberg)
Bakenberg and Matlala
region
Establishment of a plant for
the production of carbon
chemicals from coal
Re-evaluation and mining of
platinum resources (PGM)
Buffalo Fluorspar Project
Modimolle Silica
Done
Done
N/A
N/A
5 000
30 000
50
80
Mookgopong
Modimolle
Rooiberg Tin Project
Feasibility study
150
150 000
150
Rooiberg
R 60,680 million
R 3,766 500 billion
2 560
Matlala Stone Crushers
Totals
the
existing
Expansion of existing mine
Mining of additional reserves
Extraction
of
vanadium
bearing magnetite deposits
Granite mining
Production
of
stone
aggregates
from
dolerite
boulders
Mining of Flourspar mineral
Mining of silica sand and
establishment
of
a
beneficiation plant for silica
products
Re-evaluation of the old Tin
deposits
Source: Integrated Development Plan for WDM, 2005-06.
15
2.6
Local Economic Development Plan for WDM
The economic overview section of the LED for WDM contains a description of the
mining potential in each local municipality.
It also contains a table on the mining
projects that were identified as part of the spatial development initiative process in
Limpopo. The table is reproduced below. There are no specific recommendations
regarding mining development strategies, other than a general statement about
SMME development in the mining sector.
LED project proposals include a
programme to facilitate SMME participation in the mining industry, raising the wall
of the Mogol dam, upgrading the road from Modimolle to Lephalale, skills
development and the establishment of sectoral working groups. The description of
the mining potential in each local municipality is reproduced below for convenient
reference. The statement below that mining in Mogalakwena is small is incorrect.
2.6.1 Thabazimbi
A large proportion of the mining sector output comes from this municipality. The
Northam complex is rich in precious metals and diamonds and ferrous and base
metals. Among the key products are gold, while large quantities of platinum and
nickel are found in this complex. There is iron in the Thabazimbi town area and
beryllium, which provides an opportunity for small-scale mining activities.
2.6.2 Mokgalakwena Municipality
According to the LED of WDM this municipality derives little from the mining sector.
This is incorrect. It states further that the platinum sub-sector is central to the
local mining industry. The supply of platinum resources in the Vaalkop farm is
abundant. Gold, though limited, is the only other precious metal found in the area.
Ferrous and base metals consist of nickel, vanadium and tin, with titanium and
molybdenum found on a limited scale.
2.6.3 Lephalale Municipality
Activities relating to mining are centered upon the well resourced Waterberg
coalfield. A project to extract methane from this coalmine is currently being
explored. There is also a small-scale presence of minerals such as diamond, iron,
copper, nickel, refractory clay, marble, phosphate, topaz and feldspar.
2.6.4 Modimolle Municipality
In general, the mining sector in this Municipality is unlikely to take center stage in
the local economic development agenda in the foreseeable future. There are no
precious metals in the area. Available resources are not economically significant,
and examples of resources include silica, manganese, iron, tin, zirconium,
kieselguhr and fluorspar. A small-scale silica project is being planned for Modimolle
town.
2.6.5 Mookgophong
The overall indication is that the mining sector plays a small part in the local
economy. There are some platinum reserves, as well as ferrous and base metals
that include chrome and tin.
2.6.6 Bela-Bela Municipality
According to the LED strategy the contribution from mining towards local economic
development in this municipality is insignificant, though diamond resources are
available in the area. There are occurrences of precious metals, particularly gold.
Other metals especially the ferrous and base metals, are found on a limited scale,
and some of these metals comprise manganese, copper, tin and cobalt. The profile
of industrial metals is positive.
Several mining projects were identified as part of the spatial development initiative
(SDI) process as indicated in the table below.
Table 2.6: SDI Mining projects identified in the Waterberg
Location
Name of project
Capital
Required
Mogalakwena
PPL mine
R350m
Platreef
R130m
Vanadis
R54m
Haaspan Granite
R25m
Matlala stone crushers
R500m
Thabazimbi
Amandelbult
R202m
Lephalale
Grootgeluk Colliery
R150m
Mookgophong
Buffalo Fluorspar
R500m
Modimole
Silica
R30m
Thabazimbi
Rooiberg Tin
R150m
Total
11
R3 766 500
Source: LED Strategy for WDM
2.7
District
Jobs
250
800
350
80
200
200
100
50
80
150
2 560
Spatial Development Framework for WDM
The Spatial Development Framework for WDM contains extracts on mining from all
local municipality IDPs in the District. This is discussed in section 2.9 below.
Reference is specifically made to the potential for platinum mining, the Waterberg
Coalfields and the possibility of extracting coal bed methane.
There is also a discussion on mineral potential per commodity that has been
extracted from various WDM IDP documents. The strategy section cautions against
the sterilization of mineral potential by way of residential settlement and calls for
judicious environmental management programmes on mining projects.
2.8
Marketing & Investment Strategy for WDM
The marketing and investment strategy for WDM contains an extensive analysis of
the mining sector. It maintains that mining can be regarded as the most important
economic sector of Waterberg District Municipality. Aside from the Thabazimbi iron
ore mine, the region produces vast qualities of platinum at Mokopane and Northam.
Its coalfield at Lephalale, formerly Ellisras, fuels a giant Eskom power station, but
its remaining reserves of the black gold are largely untapped.
Mining resources, according to the strategy document, include the following:
17

Precious metals: Gold, Diamonds (Kimberlite), and Platinum; and

Ferrous and base metals: Copper, Tin, Manganese, Colbat, Iron, Nickel,
Titanium, Molybdenum, Vanadium, Chrome, Lead, Berylium, etc.
It states that investment opportunities are found in the following:

The Coal Mining cluster in the Lephalale area. The prospects could contribute
towards job creation and turn the area into the province’s new coal source.
Waterberg’s coal reserves have over 6.5 billion tons of coal, making it South
Africa’s third largest coal reserve after Witbank and Highveld fields. In
addition, various important minerals, such as chromium, tin, etc. are currently
mined in the area.

Apart from the popular precious and ferrous metals, Waterberg offers
opportunities to expand the exploitation of minerals such as attapulgite clay,
fluorspar, phosphate topaz, etc. Of special interest to potential investors, is
the potential for coal liquefaction.

Furthermore, Waterberg has a large deposit of antimony. This strategic
chemical element is used in alloys and in medicine.
Five specific projects are listed in the marketing and investment strategy, as
summarised below.
PRODUCT 1: Coal Liquification
Location: Lephalale Local Municipality
Potential Markets: Markets do exist nationally and internationally. As raw material
coal may be supplied to gas producers, direct as fuel, or cooking. The Waterberg coal
can be used for the following purposes: gas generation; direct liquefaction as fuel,
blend coking in ferro-alloy industries and PF combustion for electricity generation.
Competitiveness: The major coal producing areas in South Africa have reached
maturity and large scale expansion limited. The Waterberg coalfield offers the
potential to sustain energy development in the long term when coal production enters
a declining phase in the traditional high producing areas.
Resources Needed:
Infrastructure, machinery, human resources, capital
investment, etc.
Strategic Goals: Job creation, Black Economic Empowerment, poverty reduction,
integrated rural development, etc.
PRODUCT 2: Platinum
Location: It is found in Mogalakwena and Thabazimbi.
Potential Markets: Markets for platinum are found nationally and internationally. It
is in demand for manufacturing of corrosion-resistant products. The metal will be in
demand for the next ten years.
Competitiveness: Mineralisation on the Platreef (Mogalakwena) is intense and open
cast mining reduces production costs.
Resources Needed: Infrastructure, human resources, capital investment, etc.
Strategic Goals: Black economic empowerment, job creation, poverty reduction, etc.
PRODUCT 3: Vanadium
Location: Mollendraai. The main magnetic layer in this area is about 8m thick and
occurs about 230m above the first appearance of the magnetite in the sequence and
some 110m above the lowest layer.
18
Potential Markets: The market for vanadium is mostly international and prospects
are that demand will exceed supply for the next decade.
Competitiveness: Mogalakwena has large deposits of Vanadium and could become
the major source of this metal in the next 15 to 20 years.
Resources Needed: Infrastructure, human resources, capital investment, etc.
Strategic Goals: Black economic empowerment, job creation, poverty reduction, etc.
PRODUCT 4: Gold
Location: Bela-Bela Plat River and Thabazimbi (Madikwe)
Potential Markets: Gold is amongst the most popular metals. Its markets are both
national and international.
Competitiveness: Relatively at small scale, Thabazimbi is known to have good
prospects in gold mining.
Resources Needed: Infrastructure, human resources, capital investment, etc.
Strategic Goals: Black economic empowerment, job creation, poverty reduction, etc.
PRODUCT 5: Diamonds (Kimberlite)
Location: Bela-Bela (Mckenzie) and Lephalale (Swatwater)
Potential Markets: These very hard indigenous African crystalline carbon stones
valued as gems are in demand all over the world.
Competitiveness: Relatively at large sufficient scale for exploitation, Lephalale has
had extensive mining experience and has the drive to pursue diamond products
development.
Resources Needed: Infrastructure, human resources, capital investment, etc.
Strategic Goals: Black economic empowerment, job creation, poverty reduction, etc.
The marketing and investment strategy recommends five strategic focus areas:
 Encouraging Local Business Growth and Retention
 Improving the Local Business Investment Climate
 Promoting Inward Investment
 Investment in Hard Strategic Infrastructure
 Integrating Low Income or Hard-to-Employ Workers.
The establishment of a District Investment Council with an operations manager is
proposed to drive the implementation process. The following diagram of the mining
industry value chain is provided in the marketing and investment strategy.
Figure 1: Value Chain in Mining Industry
19
INBOUND
LOGISTICS
OUTBOUND
LOGISTICS
OPERATIONS
INVESTMENTS
INPUTS
END-USER
RETAILERS
PRODUCT DEVELOPMENT:
IMPROVED QUALITY
INCREASED FLEXIBILITY
JUST IN TIME
MARKETING
INFRASTRUCTURE
MONETARY
HUMAN
RESOURCES
RAW MATERIAL
ETC.
RAW MATERIALS
Shafts
2.9
EXTRACTION
PROCESSING
IDPs and LEDs for Local Municipalities in WDM
Extracts on mining from the Integrated Development Plans of the six local
municipalities in WDM are reproduced below for convenient reference.
2.9.1 Bela Bela
The IDP contains no information that is directly related to mining.
2.9.2 Lephalale
According to the Lephalale IDP document, mining shows a negative growth trend. It
is expected that the proposals concerning the expansion of the local coal mine and
the development of associated industries will reverse this negative trend. The
Waterberg coalfield has significant reserves (±50% of the Republic of South Africa’s
total reserve) and represents a major development opportunity. A pilot project is
being planned to examine the feasibility of the extraction of methane and other
related activities.
Coal beneficiation is contained in the project section of the IDP.
2.9.3 Modimolle
20
The occurrence of tin and coal is described and reference is made to the planning of
a small scale silica project outside Modimolle town.
2.9.4 Mogalakwena
The Mogalakwena IDP indicates that the contribution from mining to the municipal
GGP was R41 million in 2001 but this is likely to be a considerable understatement.
It also includes a discussion on the mineral occurrences in the municipal areas, as
well as a table with information on operating mines. There is reference to the
prospect of a new platinum or palladium mine on the farm Volspruit 326KP.
The LED strategy has only general statements about mining and small scale mining
development. Only stone crushing is included in the project section of the LED
strategy.
2.9.5 Mookgopong
According to the IDP mining in Mookgopong is confined to fluorspar (with a limited
lifespan) and to tin.
2.9.6 Thabazimbi
Mining is reflected as by far the largest employer in Thabazimbi Municipality. The
names and locations of operating mines are also provided. However, Thabazimbi
Iron Ore Mine is approaching depletion with reserves that are likely to run out
before 2015. The Thabazimbi Investment Initiative (a private initiative) was
recently established as a Section 21 Company to promote and facilitate economic
development in the area.
The IDP document contains no strategies or projects relating to mining, apart from
the statement that an LED strategy should be compiled.
2.10 Case Studies of International Best Practice
The province of South Australia has characteristics that are very similar to those of
the Waterberg District in South Africa. It is therefore considered appropriate to
reflect on the strategic development planning process in that province.
South Australia has a strategic plan of which one objective is to grow prosperity.
This objective attaches priority to sustained economic growth resulting in rising
living standards, with all South Australians sharing in the benefits through more
and better job opportunities and accessible, high quality services.
The targets within this objective that relate specifically to mining are to make
Australia a favoured mineral investment destination for private investment by
with exploration expenditure targeted to almost treble to $100 million by
Mineral production is targeted to reach $3 billion by 2020, with a further $1
worth of minerals processing by that time.
South
2010,
2007.
billion
The priority action for these targets is to develop an innovative and internationally
competitive sustainable mineral exploration industry through investment in
21
exploration, production and processing. Primary responsibility for this action is
allocated to the state (provincial) government and to industry.
Indicators of progress include quarterly and annual measures of performance in
terms of exploration, performance and international attraction.
A Mineral Resources Group has been assembled to facilitate mineral exploration and
development.
The opportunities for and possible benefits from a closer working relationship
between this Mineral Resources Group and the Waterberg District Municipality will be
considered in subsequent phases of this mining development strategy formulation
process.
22
3.
3.1
CURRENT SITUATION ASSESSMENT
Geological Overview
The geology of the Waterberg district is shown in Annexure Four. The oldest rocks
in the Waterberg district municipality are represented by the Beit Bridge Complex
and the Pietersburg Greenstone Belt. The Pietersburg Greenstone Belt is of limited
extend and it outcrops in the eastern portion f the district. The Beit Bridge Complex
consisting of a variety of high-grade metamorphic rocks covers the northern portion
of the district. These rocks are associated with corundum, nickel and beryllium.
Archaean granite and gneiss that form the floor on which sediments of the
Transvaal Supergroup were deposited, represent the oldest rocks in the district.
These rocks outcrop mainly in the southwestern and eastern portions of the district.
Although poorly mineralised, the Archaean Granite and Gneisses host some
pegmatite minerals including quartz, feldspar, beryllium, mica, lepidolite, tantalum,
scheelite and tin), corundum, graphite, copper and gold in places (Wilson, 1998).
The Transvaal Supergroup forms the immediate footwall rock to the Bushveld
Complex and consists of quartzite at the base, overlain by dolomite, banded
ironstone, alternating shale and quartzite, and an upper basaltic and volcanic
phase. The rocks of the Transvaal Supergroup are associated with zinc, lead, gold,
fluorspar, iron, asbestos and andalusite. (Wilson, 1998).
The Bushveld Complex represents the largest layered intrusion on earth covering an
area of about 65 000 km2. It consists of the mafic and ultramafic rocks termed the
Rustenburg Layered Suite, and an acid phase represented by the Lebowa Granite
and the Rashoop Granophyre Suites.
The rocks of the Bushveld Complex crop out in four sub-circular structures (the
western, eastern, northern or Potgietersrus and the Far western limbs. In the
Waterberg district, the Bushveld Complex is represented by the rocks belonging to
the northern and western limbs. The Rustenburg Layered Suite of the Bushveld
Complex host vast resources of platinum group elements, chrome, vanadium and
nickel. These rocks are estimated to contain about 75 % and 50 % of the world `s
resources of platinum and palladium respectively (Cawthorn, 1999). The acid phase
of the Bushveld Complex is associated with fluorspar, tin and copper mineralisation.
A generalised geological map of the Bushveld Complex showing the outcrop of the
different limbs comprising the Bushveld Complex is presented in figure one below.
23
Figure One: Outcrops on the Bushveld Complex
3.2
Economic Geology
The rocks covering the Waterberg district area are well endowed with a significant
number of economically important minerals that include the platinum group metals,
iron, coal, andalusite, tin and fluorite. Some of these minerals are currently
exploited for their economic value while exploration is on-going in order to expand
the lifespan of the existing mines and also to identify and develop new deposits.
This description of the mineral commodities and their future potential is structured
in the sequence of their current economic importance.
3.2.1. Platinum Group Metals (PGM)
Platinum group metals (platinum, palladium, rhodium, ruthenium, osmium, and
iridium) occur in the mafic and ultramafic rocks of the Bushveld Complex. In this
complex, the platinum group metals occur in layers known as the Merensky Reef,
the UG 2 Chromitite and the Platreef. Significant amounts of base metal sulphides
are associated with the Bushveld Complex mineralised horizons.
The Merensky Reef and the UG 2-chromitite seam occur in the north-western limb,
south of Thabazimbi while the Platreef occurs only in the northern limb extending
north-south of Mokopane. According to Cawthorn (1999), in the Merensky Reef,
Platreef and the UG 2 Chromitite, the relative proportions of platinum and
palladium are about 55 % and 32 %, 44 % and 46 %, and 46 % and 30 %
respectively, with the other metals comprising about 15 %. The PGM grades in
these Reefs are shown in the table below.
24
Table 3.2.1: PGM grades in the Bushveld Complex in grams per ton (g/t)
Metal
Merensky
Reef
UG 2
Platreef
Platinum
3.24
2.46
1.26
Palladium
1.37
2.04
1.38
Ruthenium
0.44
0.72
0.12
Rhodium
0.16
0.54
0.09
Iridium
0.06
0.11
0.02
Osmium
0.04
0.10
0.02
Total
5.31
5.97
2.89
Source: Keller, 1983
Until the early 90`s, platinum group metals production was confined to the
Merensky Reef and the UG 2 Chromitite. Although exploitation of the Platreef dates
back to the early 1920`s, large-scale production only began in the 1990`s with the
opening of Anglo Platinum Potgietersrus Platinum mine at Sandsloot.
The Merensky Reef is typically a heterogenous pegmatoidal feldspathic pyroxenite
with scattered sulphide blebs and is generally bounded by narrow chromitite
stringers (Viljoen and Schürmann, 1998). The reef varies in thickness from less
than 3 cm to about 14 m. At the Union Section, Amandelbult and at Northam
Platinum Mine a gradual change in depth occurs from thick Merensky Reef (> 1 m)
via areas of increasing potholing to narrow reef. According to Viljoen and
Schürmann (1998) a variety of PGE alloys, dominantly iron-rich phases constituting
40 % of the PGM`s are regionally the most important at the Union, and
Amandelbult Sections and at the Northam Platinum mine. These platinum group
metals occur either attached or enclosed to base metal sulphides, enclosed in
silicates and to a lesser extent attached to chromite or iron oxides. The base metals
in order of abundance are pyrrhotite, pentlandite, chalcopyrite, pyrite, cubanite and
rare sulpharsenides, galena and sphalerite (Lee, 1996).
The UG 2 Chromitite occurs 15 to 400 m below the Merensky Reef. This reef
contains up to 10 ppm PGE + Au. The platinum group metals are concentrated
towards the base of the UG 2 Chromitite as well as in the middle, or towards the
upper contact. The copper and nickel content of the UG 2 Chromitite are generally
low (< 0.05 %).
The Platreef is a major PGE-Ni-Cu mineralised horizon in the northern limb of the
Bushveld Complex. It attains a maximum thickness of about 400 m. Unlike the
Merensky and the UG 2 chromitite Reefs, the Platreef is developed at the base of
the layered sequence. Mineralisation within the Platreef varies along strike and this
variation is attributed to the variations in footwall rocks. The Platreef has relatively
more palladium than the Merensky and the UG 2 chromitite Reefs.
25
3.2.2 Coal
The Waterberg (Ellisras) Coalfield, covering an area of approximately 88 km x 40
km was discovered in the 1920`s. Coal occurs associated with the Karoo
Supergroup rocks. This outcrops in the western portion of the Waterberg district.
This coalfield is heavily faulted with the major faults striking in the east-west
direction. The coalfield is divided into eastern and western sectors by the Daarby
fault (Snyman, 1998). The western sector is shallower while the eastern sector is
relatively deeper. Faulting has rendered some areas unmineable; however, the
scarcity of dolerite intrusions offsets the structural complexity of the area to a
certain degree. Here, the coal-bearing interval attains a thickness of about 115m.
The Waterberg coalfield hosts over 40 % of South Africa’s in situ mineable coal
reserves and is considered as the major source of South African coal in the next
century.
3.2.3 Iron Ore
Economically important deposits of iron occur associated with the Penge Formation
of the Transvaal Supergroup. These deposits are currently exploited by Thabazimbi
iron mine on the farms Donkerpoort 344 KQ and Kwaggashoek 345 KQ located
about 180 km northwest of Pretoria. Occurrences are reported on the farms
Melkbosch 139 MR, Deptford 16 LR, Doornkraal 15 LR, Houndslow 372 LQ,
Adriaanshoop 291 KQ, Cornwal 313 KQ and Donkerpoort 448 KQ. Some iron
deposits (i.e. Goevernements Plaats 417 KQ and Oskuil 390 KQ) occur associated
with vanadium and titanium.
The distribution of these deposits was controlled by large scale pre-Karoo thrust
faulting and post-Karoo normal faulting. At Thabazimbi mine, the ore is made of
high-grade hematite that occurs in the basal portion of the Penge Formation and
has a dip of 60 º (Astrup et al., 1998). Hematite with iron content of less than 56
% is considered as waste.
3.2.4. Diamonds
Diamond deposits occur on the farms Palmietgat 34 JR, Oaks 153 MR and
Zuurverdiend 167 KP. The deposit at Palmietgat 34 JR is exploited by Palmietgat
mine while the Oaks mine (De Beers) is exploiting by the Oaks deposit. The
Zuurverdiend 167 KP deposit was never exploited. The Oaks mine established in
1998 is located about 20 km from Swartwater. The Oaks kimberlite pipe is
approximately one hectare in size. This is a group I type kimberlite, which was
intruded into the quartzo-feldspathic and amphibolite gneisses of the Limpopo belt.
The current reserves at the Oaks mine will be depleted in 2008. The kimberlite ore
body has inferred resource of 3.7 million tons and reserve of 2.1 million tons to a
mining depth of 110 m.
3.2.5. Andalusite
Andalusite is well developed near Thabazimbi in the Timeball Hill Formation shale of
the Transvaal Supergroup (Blain et al., 1976). Deposits of andalusite occur on the
farms Bufffelsfoentein 353 KQ, Rooywal 441 KQ, Grootfoentein 352 KQ and
Rhenosterkloof 483 KQ, with occurrences reported on Buffelshoek 351 KQ,
Roodedam 368 KP and Weltervreden 478 KQ. On the farm Grootfontein 352 KQ,
andalusite occurs as medium grained porphyroblasts, 0.4 cm in diameter and up to
5 cm in length in weathered hornfels. According to Oostrhuis (1998), the orebody
26
strikes in a northeast-southwest direction with a true thickness of 210 m and a dip
of 55 º to the southeast. On this farm andalusite contains about 54 - 59 wt percent
Al2O3, constituting 10 to 13 % of the rock.
3.2.6. Dimension stone
Dimension stone incorporates all naturally occurring rock material cut, shaped or
selected for use in blocks, slabs, sheets or other construction units of specific shape
or size, and employed for exterior or interior parts of buildings, foundations,
kerbing, paving, flagging or for other architectural or engineering purposes (Stone
in Southern Africa, 1999). The dimension stone quarried from the Bushveld
Complex is in strong demand on the world market and dominates export sales,
owing to high quality, competitive prices and reliability of supply.
3.2.7. Limestone
Limestone occurs in the Transvaal Supergroup and this can be exploited and used
for cement production and/ or for agricultural purposes. Rocks of the Frisco
Formation that forms the footwall rock to the Bushveld Complex on the farm
Vaalkop 819 LR are a potential source of limestone (Martini, 1987). The main
limestone deposit in the Waterberg district is located 9 km north-northeast of
Mokopane on the farm Uitloop 3 KS (Martini and Wilson, 1998). This deposit was
exploited in the past but production ceased.
3.2.8. Calcite
Calcite deposits occur on the farms Syferfoentein 608 KR, Leeuwdoorns 607 KR and
Middleplaats 604 KR. The Syferfoentein deposit was exploited by Monte Carlo while
the Leeuwdooms 607 KR and Middleplaats 604 KR deposits were never exploited.
3.2.9. Chrome
Chromite occurs in seams in the Critical and Lower Zones of the Waterberg
Complex. On the farm Zwartfontein 818 LR north-northwest of Mokopane, three
chromitite layers are present in the plagioclase bearing rocks (Schürmann et al.,
1998). Two other chromitite layers of no economic importance crop out on the farm
Vaalkop 819 LR (van der Merwe, 1978).
In the Mokopane area chromitite was discovered in the early sixties on the farms
Grassvalley 293 KR and Zoetveld 294 KR about 17 km south-southwest of
Mokopane (Coetzee and Coetzee, 1976). The composition for this ore ranges from
42-45 percent Cr2O3, 14 -15 percent FeO, 6-9 percent SiO2 and a Cr/Fe ratio of 2.4
to 2.7 (Cotzee and Coetzee, 1976). This ore was superior in grade to any other
chromitite mined in the Bushveld Complex at that time (Hulbert and Von
Gruenewaldt, 1986). This deposit was exploited by Grasvalley chrome mine owned
by SAMANCOR. However, the area is structurally complex.
3.2.10. Tin
The Zaaiplaats tin deposits are located some 35 km northwest of Mokopane. These
important deposits occur associated with the acid phase of the Bushveld Complex.
The most important deposits are found on the farms Roodepoort 222 KR, Zaaiplaats
223 KR, Salomon`s Tempel 230 KR, Groenfontein 227 KR, Welgelegen 246KR,
Doornhoek 342 KR and Stravoren 676 KS. Tin mineralisation occurs in pipe-like
roughly cylindrical bodies, flat ventricular bodies and as disseminations. These
27
pipes range in diameter from a few centimetres to 12 m with an average diameter
of 1 to 2 m. Pipe-like bodies have a cassiterite content ranging from nil to 70
percent with metallic tin averages 12 to 30 % (Crocker et al., 1976).
On the farms Groenvley 224 KR and Appingendam 805 LR cassiterite occur along
with molybdenite, arsenopyrite, fluorite, bastnaesite and other rare-earth minerals
(Bullen et al, 1995). Values of up to 3.2 % Sn have been recorded on the farm
Groenvley 224 KR over a width of 0.91 m. The Sn content of these rocks varies
significantly.
3.2.11. Fluorite
Fluorspar was mined from acid rocks of the Bushveld Complex in the past, however
due to the low price of fluorite the mines have closed. Fluorspar was exploited
northwest of Mookgopong on the farm Buffelsfontein 347 KR by Buffalo Fluorspar
mine. This mine was closed in 1994 due to low prices of fluorspar. The dumps are
currently being reworked as a source of crushed rock. Crocker and Martini (1976)
reported ore reserves amounting to 60 million tons at 16 percent CaF2. The
Vischgat deposit occurs south of Mookgopong on the farm Vischgat 520 KR. Fluorite
deposit were also exploited in the Vila Nora segment of the Bushveld Complex on
the farm Grobbelaars Hoek 462 LR.
Fluorspar was also exploited west of Bela-Bela (Warmbaths) on Zwartkloof 470 KR
by the Zwartkloof Fluorspar mine and also on the farm Rhenosterhoekspruit 466 KQ
by Rheno Fluorspar mine. The Zwartkloof Fluorspar mine closed due to the low
prices of fluorspar and problems in upgrading such low-grade material to acid grade
(Crocker and Martini, 1976). According to Crocker and Martini (1976) original
estimates of the Zwartkloof deposit indicated an ore body of 5 to 7 million tons.
3.2.12. Clay
Kaolin deposits occur on the farm Rooiboscbaak 107 KS, approximately 20 km
northeast of Zebediela railway station (Horn and Strydom, 1998) and also on
Weenen 40 KS. The Weenen deposit is exploited by Weenen Brickyard for brick
making. Refractory plastic or fire clay occurrence has been reported from
Cyferfoentein 457 KR south of Modimolle.
3.2.13. Molybdenum
Molybdenum occurrence is reported on Groenvlei 224 KR, Hartbeestfoentein 62 KS,
Appingendam 805 LR and Stravoren 676 KS. Molybdenum is also found associated
with tin deposits (i.e. at Stravoren 676 KS). Appingendam mine exploited the
Groenvlei deposit. The Groenvlei deposit has an estimated reserve of 1 300 t at an
average grade of 3 % MoS2 (Wilson and Cole, 1998). There is currently no
molybdenum production in the country.
3.2.14. Phosphate
Phosphate has been exploited from Glenover 371 LQ, Houndslow 372 LQ and St.
Agnesfontein 347 LQ between 1958 to 1983 by Glenover Phosphate Ltd (Wilson,
1998). In the Upper Zone of the Bushveld Complex occurrence of apatite with P2O5
content in the magnetite averaging between 5 and 8% is reported on
Deugdzaamheid 197 LR, Turflaagte 214 LR, Grootwater 436 LR and Klippan 437 LR
(Wilson, 1998). A resource of 25 Mt has been established to a vertical depth of 100
m on the farm Turflaagte (Grobler and Whitefield, 1969).
28
3.2.15. Cobalt
Cobalt is produced as a by-product from platinum group metals mining in the
Merensky Reef, Platreef and the UG 2 Chromitite. This zone carries about 1.5 %
cobalt (Hammerbeck and Schürmann, 1998). However these bodies have limited
lateral and vertical extent and are of no economic importance (Hammerbeck and
Schürmann, 1998).
3.2.16. Copper
In the Bushveld Complex copper occurs associated with both the acid and mafic
rocks. Copper produced in the Waterberg comes from the Bushveld Complex as a
by-product from the Merensky Reef and the Platreef and also associated with the
Transvaal Supergoup rocks.
Copper occurrences are reported close to the mutual border of Planknek 43 KS and
Weenen 40 KS about 10 km east of Mokopane (Wilson, 1998). These occur in the
form of malachite, bornite and chalcopyrite associated with galena in the quartz
veins within dolomite. Other occurrences are reported on the farms Mauritius 183
MR, Theuniskloof 164 MR, Smirna 188 MR, Klipvley 174 MR, Mietjesfontein 220 MR,
Karrieboschdrift 163 MR, Rosendale 221 MR, Slangkop 162 MR, Davidslust 240 MR,
Cambridge 242 MR, Dassenburg 75 MR, Bottlellang 115 MR, Zeekoevlei 11LR,
Reward 435 LR, Glenover 371 LQ and Lngwater 62 KR. On the farm Stavoren 676
KS copper is found associated with tin mineralisation (Wilson, 1998). Disseminated
copper sulphides occurrence is reported from the farm Nederland 51 KS 20 km
southeast of Mokopane.
3.2.17. Gold
Gold is produced as a by-product from platinum mines exploiting the UG 2,
Merensky Reef and the Platreef in the Bushveld Complex. In the Transvaal
Supergroup gold mineralisation is found associated with the basal conglomerate of
the Black reef quartzite formation in the Kaapsehoop area at the base of the
Transvaal Supergroup (Ward and Wilson, 1998). Mining for these deposits was not
successful because of the limited extends of the conglomerate and erratic
distribution of gold.
3.2.18. Nickel
In the Waterberg district, nickel is produced as a by-product of PGM processing
from the Platreef and the Merensky Reef. Hydrothermal nickel occurrence is
reported from Blaauwbank 515 KQ about 6 km to the east of the main workings of
the disfuntional Rooiberg Tin mines (Hammerbeck and Schürmann, 1998).
3.2.19. Lead
About 1 500 t of galena has been mined from the deposit on Leeubosch 129 KQ, 16
km north of Thabazimbi in the Malmani dolomites (du Toit, 1998). It occurs along
bedding planes in early intergranular spaces in the dolomite of the Lyttelton
Formation, in vertical siderite veins, as well as in pod-like bodies of siderite with
galena deposited in karst cavities. Occurrences of lead mineralization have been
reported from the farms Turflaagte 214 LR, Deugdzaamheid 197 LR, Waterval 443
KQ, Planknek 43 KS and Nooitgedacht 92 KR. Galena also occur as an accessory
mineral associated with the tin mineralisation (i.e. on the farm Groenvley 224 KR
and Stavoren 676 KS) hosted in the Bobbejaankop granite of the Bushveld
Complex.
29
3.2.20. Tantalum and niobium
Cassiterite from tin deposits related to the Bushveld Complex contains an average
of less than 0.5 % tantalum and niobium (Ollia, 1986).
3.2.21. Tungsten
Scheelite is the major ore bearing body of tungsten in the Waterberg district. Its
occurrence is reported on the farms Zaaiplaats 223 KR and the Roodepoort 222 KR
(Bowles and Hammerbeck, 1998).
3.2.22. Vanadium
Vanadium deposits are found on the farms Gezond 235 KR, Commandodrift 238 KR,
Molendraai 811 LR, Nooitgedacht 11 JQ, Rooipoort 46 KS, Macalacaskop 243 KS,
Jaagbaan 291 KR and Mozambique 807 LR. Occurrences are also recorded on the
farms Eulalie 186 LR, Deugdzaamheid 197 LR and Klippan 437 LR. These deposits
and occurrences generally occur in the titaniferous magnetite seams in the upper
portion of the Rustenburg Layered Suite of the Bushveld Complex Vanadium is
found mainly associated with iron and titanium.
3.2.23. Manganese
In the Waterberg district occurrences of manganese are reported on the farms
Frischgewaagd 445 KR, De Nyl Zyn Oog 423 KR, Tweefontein 463 KR and
Cyferfontein 457 KR (Hammerbeck, 1976). These deposits are either small or poor
quality that even small-scale mining is uneconomic. At the Thabazimbi iron mine
manganese ore assaying up to 57 % Mn occurs (Astrup and Tsikos, 1998).
According to Astrup and Tsikos (1998) the ore is of good quality, but mining
presents serious difficulties because of the treacherous nature of the ground.
3.3
Current Mining Operations
3.3.1 Platinum
There are currently four operating platinum mines in the Waterberg district which
include the Union and Amandebult sections of the Rustenburg Platinum mine,
Potgietersrus Platinum and Northam Platinum mine. The production figures for
these mines are shown in the table below. The Union Section, Amandebult Section
and Northam Mine exploit the Merensky Reef and the UG 2 Chromitite while
Potgietersrus Platinum is currently the only mine exploiting the Platreef.
Potgietersrus Platinum is currently operating two open pits: the Sandsloot and the
Zwartfontein south pits with plans to start production from the third (Overysel/
Zwartfontein north) in early 2006.
30
Table 3.3.1 Production Figures for Platinum Mines in WDM
Amandelbult Section#
Refined Production
Platinum
Palladium
Rhodium
Gold
PGMs
Nickel
Copper
000
000
000
000
000
000
000
oz
oz
oz
oz
oz
tons
tons
2003
2002
2001
2000
605,6
272,0
64,8
19,8
1 048
4,0
2,3
634,6
277,1
66,1
24,0
1 102
3,9
2,3
711,0
314,7
71,9
23,6
1 229
4,2
2,1
679,3
299,4
73,0
23,0
1 172
4,2
2,3
570,8
261,1
57,2
22,1
982
4,1
2,3
2003
2002
2001
2000
313,2
132,6
43,6
5,8
572,0
1,1
0,5
284,7
125,8
40,2
5,2
514,7
1,0
0,4
280,4
122,2
42,3
4,8
505,2
1,1
0,5
288,8
137,7
42,1
5,3
528,5
1,4
0,7
2002
2001
2000
165,3
159,0
12,1
17,1
349,4
3,4
1,9
211,1
219,8
16,4
21,2
462,9
4,2
2,2
194,1
203,7
13,9
19,6
424,0
4,4
2,3
2004
Union Section#
Refined production
Platinum
Palladium
Rhodium
Gold
PGMs
Nickel
Copper
2004
000
000
000
000
000
000
000
oz
oz
oz
oz
oz
tons
tons
319,6
139,8
47,6
5,4
581,6
1,1
0,5
Potgietersrus Platinum#
Refined Production
Platinum
Palladium
Rhodium
Gold
PGMs
Nickel
Copper
000
000
000
000
000
000
000
2004 2003
oz
oz
oz
oz
oz
tons
tons
Northam Platinum*
Refined production
Platinum
000 oz
Palladium
000 oz
Rhodium
000 oz
Gold
000 oz
Total (3 PGE +Au) 000 oz
Copper
000 tons
Nickel (tonnes)
000 tons
196,0
209,2
13,1
21,7
431,9
5,1
2,9
2005
202.459
98.255
17.619
6.881
325.214
0.953
1.677
188,9
196,9
12,5
21,4
411,0
5,7
3,2
2004
212.006
102.884
18.423
7.234
34.0547
1.015
1.816
# Data from Anglo Platinum website
*Data from Northam Platinum website
31
The largest producer of refined platinum in Waterberg district municipality is the
Amandelbult mine, followed by Union Section, Northam and Potgietersrus Platinum
respectively. Union Section is located just across the boundary from Amandelbult
(Thabazimbi) and is situated in Northwest Province.
At Amendelbult Section there was an increase in the refined platinum ounces
produced in 2000 to 2002. In 2003 to 2004 there was a decrease in the production
of refined platinum from 634600 oz to 605600 oz. Northam mine also recorded a
decrease in the production of refined platinum from 212006 oz in 2004 to 202459
oz in 2005. This mine produces approximately 340 000 oz of platinum, palladium,
rhodium and gold (3 PGE + Au) from the Merensky Reef and the UG 2 Chromitite.
Within the Northam lease area reserves are measured at 12.7 M oz with resource
base of 17.4 M oz.
Potgietersrus Platinum is the only operating mine in the northern limb exploiting the
Platreef. It produces about 200 100 ounces of refined platinum from two pits
(Sandsloot and Zwartfontein south pit).
In 2003, the global supplies of platinum, palladium and rhodium rose by 16.7 % to
419.2 t and the demand grew by 4.3 % to 385.9 t (SAIM, 2003/2004). The supply
of platinum group metals is expected to increase due to expansion of the existing
operations in the northern and western limbs of the Bushveld Complex.
3.3.2 Coal
Coal is exploited from the Waterberg coalfields at Grootegeluk Coal Mine (Kumba
Resources) on the farm Enkelbult 462 LQ, a subsidiary of Kumba Resources. This
colliery was developed in mid 1970s. Production figures are presented in the table
below, reflecting a steady increase. In the year 2004, the Grootegeluk Colliery
produced 17.4 million tonnes of coal and had 2827 employees at the end of 2005.
Table 3.3.2: Coal Production (‘000 tons) from Grootegeluk Colliery
Coal Type
2004
2003
2002
2001
Thermal Coal
14,356
14,097
13,198
11,934
Coking Coal
1,972
1,781
1,670
1,536
Other Coal
1,403
1,323
1,194
1,258
Total
17,731
17,201
16,062
14,728
Source: Kumba Resources 2004 Annual Report).
2000
12,072
1,312
1,152
14,536
3.3.3 Iron Ore
The Thabazimbi Iron Ore Mine produces about 2.5 Mt of iron per annum. In 2004
the mine had sufficient ore to continue operating until 2012. Astrup et al. (1998)
reported total in situ reserves of high-grade hematite ore of 87.5 Mt with an
additional 19 Mt of calcic ore. Measured reserve estimates for 2004 are 12,4 million
tons proven and 8, 6 millions probable. Measured resource estimates for the same
year are 32,43 million tons being indicated resources and 16, 9 million tons inferred
resources.
The Thabazimbi iron mine also plays a significant role in terms of employment in
the district. In 2004 the mine had 950 employees.
32
3.3.4 Other Mines in WDM
The Oaks Diamond Mine has a total workforce of about 152 people including
contractors. In 2003, production was 100 123 carats from treating 312 kt of ore at
32.1 carats/100 tons.
On Grootfontein 352 KQ andalusite mining began in 1977 by Weedon`s Minerals
(Pty) Ltd (Oosterhuis, 1998). Anglovaal Ltd acquired this company in 1991 and the
name was changed to Rhino Andalusite mines. It is the largest andalusite producer
in South Africa. Andalusite Resources (Pty) Ltd a subsidiary of African Mineral,
Trading and Exploration (Pty) Ltd produces andalusite from its operations at
Maroelesfontein 366 KQ.
Rough granite is produced from the Bushveld Complex by Africa Red Granite
Quarries, Red Stone Mining and Bestaf Granite (Pty) Ltd and Marlin Granite (Pty)
Ltd. Bushveld Granite is exploited on the farm Klipplaatdrift 787 LR and Leyden 804
LR by Lebowa Granite (Pty)/Bestaf Granite (Pty) Ltd. This sector employs more
than 150 people.
Limestone is currently exploited on the farms Calais 563 KS, Malgas 154 KS,
Singapore 585 KS and Syferfontein 608 KR by Leo Limestone, Inca mining and
Syferfontein calcite (Pty) Ltd respectively. Currently, the Syferfontein deposit is
exploited by Syferfontein calcite (Pty) Ltd. Syferfontein calcite (Pty) Ltd had 38
employees in July 2005.
Zwartkop is the only mine currently exploiting chrome in the Waterberg district
municipality on the farm Zwartkop 369 KQ.
3.4
Mining in the District Economy
Estimates of the contribution from mining to the Gross Geographic Product (GGP) of
Waterberg District are outdated. These estimates were compiled in 2001 and
concluded that the size of the Waterberg district economy was R9.6 billion in 2000.
The GGP of Limpopo was estimated to be R36 billion and Waterberg was the
biggest district economy in the Province.
Mining was the biggest sector in
Waterberg, contributing R4 billion to the district economy.
The reason why these estimates can no longer be used is because Statistics South
Africa has re-based the national and provincial production figures.
GGP for
Limpopo was R93.2 billion at 2004 prices and R59 billion for 2000, but the
breakdown within districts is not available.
However, the GGP co-efficient for the mining sector in Limpopo is known from the
Limpopo input-output model to be 0.34. The GGP from mining can therefore be
estimated if the sales figures for the various commodities can be obtained. This is
quantified in the table below.
33
Table 3.4.1: Estimated Value of Mineral Commodity Sales from WDM R’m
Commodity
2004
2003
2002
2001
Platinum Group
8,193
7,437
9,408
9,084
Coal
1,500
1,400
1,300
1,200
Iron Ore
500
450
450
450
Diamonds
85
100
100
100
Other
95
90
85
80
Total
10,370
9,480
11,340
10,910
Source: Annual Reports (Kumba values are estimated from consolidated figures in
their annual report. Other, mostly granite and lime, is estimated)
On the basis of these estimates, the contribution from the mining sector to GGP in
Waterberg District is approximately R3.5 billion.
Another way of estimating economic impact is to consider capital investment
patterns by mining companies.
Table 3.4.2: Actual Capital Expenditure at Mines in WDM R’m
Mine
Ongoing 2004
Expansion 04
Ongoing 2003
Amandelbult
314
0
435
PPRust
186
0
339
Northam
118
172
Grootegeluk
205
125
Total
823
1071
Source: Annual Reports
Expansion 03
0
0
Although there is considerable exploration underway, actual capital expenditure
appears to be declining, which provides no confidence that production will be
expanded considerably in the short to medium term.
Thirdly, employment in the mining industry is an important indicator of economic
impact. It is evident from the table below that mining employment has increased
considerably in Mogalakwena Municipality and to some extent in Lephalale between
1996 and 2001. However, total employment in the mining sector for Waterberg
District has actually declined, with the largest loss in Thabazimbi Municipality.
Table 3.4.3: Employment in the Mining Sector in WDM
Municipality
2001
1996
NP361: Thabazimbi
9619
12824
NP362: Lephalale
1828
1459
NP364: Mookgopong
89
14
NP365: Modimolle
86
48
NP366: Bela-Bela
51
15
NP367: Mogalakwena
1650
497
Total
13323
14857
Source: Stats SA Census 2001 and 1996
The labour force in WDM was 140,235 persons in 2001, which means that 9.5% of
the labour force is employed in the mining sector. The Thabazimbi Municipality will
34
be very sensitive to further losses, because 37% of its labour force is employed in
the mining sector.
A list of employment per mine is currently being obtained from the Inspector of
Mines.
3.5
Opportunities for Expansion
3.5.1 Platinum group metals
The increase in the platinum group metals prices in recent years has put much
pressure on mining and exploration companies to increase their production and
consequently, to expand the lifespan of the mines. This in itself has resulted in
renewed search for new deposits and an expansion of ore reserves. The Bushveld
Complex, in particular the northern limb has in the recent years become a major
exploration target for the PGE and other elements such as nickel and copper.
Companies exploring the Platreef include Platinum Group Metals (Pty) Ltd, Platreef
Resources (Pty) Ltd, Anglo Platinum, Eersteling Gold Mining Company, Anooraq
Resources, AfriOre, Pan Palladium and AIM Resources.
The Waterberg District has the potential to become the major producer of platinum
group metals in the world. Export earnings are forecast to increase from 3 378
million US dollars in 2003 to 5 127 million US dollars in 2008 (SAIM, 2003/2004).
The planned expansions and opening of new platinum mines (particularly in the
Mokopane area) will led to an increase in gold, copper, nickel and cobalt production
in the Waterberg District.
3.5.2 Coal
The Waterberg Coalfield appears to be the replacement for the Mpumalanga
coalfields. However, the Waterberg Coalfield is located away from major markets.
In trying to solve the transportation problem a combined task team was established
to consider at a new railway line linking the Waterberg area to Middleburg, which
would allow Grootegeluk to rail coal over a much shorter route.
Kumba Resources estimates that coal output from the Waterberg coalfields could
double to about 40 Mt/year as part of the investment in additional power
generation. Availability of good infrastructure in the district will enhance the
potential for the Waterberg to become a significant mining and industrial center in
South Africa. This coalfield is also a promising area for coal bed methane
extraction.
3.5.3 Iron ore
Thabazimbi Iron Mine is approaching depletion and closure could occur in 2012.
However, hematite with less than 56 % iron is considered as waste. This waste may
be processed for its iron content in the future depending on the demand, price and
availability of iron deposits in the country. Vast reserves of vanadium bearing,
titano-magnetite occur in the Upper Zone of the Bushveld Complex.
3.5.4. Dimension stone
A large variety of rocks with a potential to be used as dimension stone occur in the
Waterberg district municipality. Lack of good road and rail infrastructure are major
limiting factors in the development of the dimension stone industry in the district.
35
Processing of the material should also be done in the vicinity of quarrying in order
to reduce transportation costs, thereby increasing income from such operations.
Waste produced from these operations can be used as aggregate for construction.
3.5.5 Chrome
Chrome was extracted from the Bushveld Complex rocks south of Mokopane on the
farm Grasvalley. Depending on the price, demand and supply for chrome, the
Grasvally deposit represents a potential resource for exploitation.
3.5.6 Tin and fluorite
A number of tin and fluorite mines were operating in the Waterberg district
municipality. However, due to low prices for tin and fluorite the mines have closed.
The increase in the demand for tin and fluorite can lead to reopening of some of
these mines.
3.6
Business-as-Usual Scenario for Mining in WDM
At this early stage of analysis, it is evident that platinum, coal and iron ore are the
three most important mineral commodities in WDM. Platinum extraction from the
Platreef has caused mining to become an important economic sector in
Mogalakwena Municipality.
Production is increasing for all three these commodities, although employment has
declined, particularly in Thabazimbi. There are considerable market and private
sector pressures to increase capital investment in all three commodities even
further. These pressures are being contained by limitations in terms of water
availability, transport costs and skills.
In the business as usual scenario it is assumed that economic infrastructure will not
be expanded significantly over the next decade and the skills shortage will remain.
It is also assumed that no particular effort will be made to promote new project
developments, such as expansions to Matimba Power Station or extraction of iron
and vanadium from the large deposits of vanadiferous magnetite that occurs in the
district. Coal bed methane gas will remain untapped under this assumption.
Under this scenario some mining developments are likely to occur, such as a new
opencast mine for Anglo Platinum in the Mogalakwena Municipality. However, this
mine is intended to replace the existing mine that is expected to reach the end of
its useful life in 2015. Limited coal mining expansions could also occur, most
probably in association with adjacent opencast mining developments in Botswana.
Thabazimbi Iron Mine is expected to be depleted by 2012.
Despite these developments, employment is unlikely to increase substantially and
could even decline in areas like Thabazimbi. The business as usual scenario
therefore holds some benefits for Mogalakwena and Lephalale municipalities, but is
particularly negative for Thabazimbi Municipality. The status quo in terms of the
relative insignificance of the mining sector for Modimolle and Mookgopong
Municipalities is likely to remain.
36
This scenario suggests that mining will remain a significant sector in the Waterberg
District economy, but that its vast potential will not be fully realised.
The
contribution from this sector to poverty reduction will therefore also be limited.
A business as usual scenario should be avoided in order to promote the
development objectives of WDM. Accelerated development will require a concerted
intervention, which is the topic of subsequent phases of this mining development
strategy formulation process.
37
4.
CONCLUSION ON PHASE ONE AND TWO
The purpose of this strategy formulation process is to provide WDM with a policy
instrument by which leadership and strategic direction can be given to the mining
industry for:
 Increased competitiveness on a sustainable basis,
 Increased investment as a basis for job creation and economic growth,
 Improvements in the quality of life of the district population, including
priorities such as BEE, as well as reductions in HIV/AIDS and poverty,
 Regional integration.
This mining development strategy is part of a broader intervention that is aimed at
accelerated economic development in Waterberg District.
The mining development strategy will be compiled in the following five distinct
phases:
 Policy Assessment
 Current Situation Assessment
 Scenario Analysis
 Project Development Opportunities, and
 Implementation Plan.
The policy and current situation assessments are presented in this report as a
discussion document. It will be formalised once comments from stakeholders have
been received.
In terms of the Mineral and Petroleum Resources Act, WDM has no direct
jurisdiction in terms of mining, but it may facilitate the development process. It is
therefore imperative that a good working relationship should be established
between WDM and the DME Regional Manager in Limpopo. The municipality is also
obliged to facilitate the economic and mining development processes by building
networks and promoting good working relationships between various institutions in
the sector, such as private companies, parastatal development organizations and
public infrastructure agencies. An interface with national strategies such as the
small scale mining initiative, integrated manufacturing strategy, as well as the
national research and development strategy, should be created.
WDM has an important role to play in promoting the stake of historically
disadvantaged companies that are based in Waterberg District within the targets of
the mining charter.
The relevant provincial growth and development strategy is to adopt the
development cluster value-chain approach, as a vehicle to raise the international
competitiveness and investment rating of the Province, to combine public and
private sector contributions to development and to align the interventions of
various public development institutions for greater impact. Two of the seven
competitive clusters for Limpopo that were identified and approved in the Provincial
Growth and Development Strategy fall within the mining sector of Waterberg
District. These are the platinum and coal mining clusters with their associated
value chains.
38
The Marketing and Investment Strategy for WDM also recommends the cluster
value chain approach as the appropriate instrument for development planning
purposes and the establishment of a District Investment Council with an operations
manager is proposed to drive the implementation process.
LED project proposals include a programme to facilitate SMME participation in the
mining industry, raising the wall of the Mogol dam, upgrading the road from
Modimolle to Lephalale, skills development and the establishment of sectoral
working groups.
South Australia is considered to be a useful example of international practice in
terms of development planning in the mining sector and its results will be assessed
for the purpose of comparison.
The rocks covering the Waterberg district area are well endowed with a significant
number of economically important minerals that include the platinum group metals,
iron, coal, andalusite, tin and fluoride. Some of these minerals are currently
exploited for their economic value while exploration is on-going in order to expand
the lifespan of the existing mines and also to identify and develop new deposits.
Sales value of mining production from WDM has increased beyond R10 billion,
which implies a contribution to GGP of approximately R3.5 billion. However, capital
investment and employment in mining appears to be decreasing.
A business as usual scenario suggests that mining will remain a significant sector in
the Waterberg District economy, but that its vast potential will not be fully realised.
The contribution from this sector to poverty reduction will therefore also be limited.
This scenario should be avoided in order to promote the development objectives of
WDM. Accelerated development will require a concerted intervention, which is the
topic of subsequent phases of this mining development strategy formulation
process.
Report Two will deal with the results of the scenario analysis. It will include a
SWOT analysis for mining development and a proposed strategy to reach the highroad scenario. This report is scheduled for release as a discussion document at the
end of February 2006.
Report Three will cover project development opportunities as well as the
implementation plan and this will be released as a discussion document at the end
of March. All three reports will be consolidated into a final strategy document once
stakeholder comments have been received.
39
ANNEXURE ONE
ANNEXURE TWO
BATEMAN PROJECT HOLDINGS
PREFEASIBILITY STUDY: NOVEMBER 1991
‘The upper ecca coal at Kumba’s Grootegeluk mine has been demonstrated to be
The most liquefiable coal known in the world’
Increased mining
And beneficiation
From Grootegeluk
R2.4 bn capital investment
1mta chemical Plus 100 000
Grade low ash
Tons of
coal
hydrogen
Increased supply to Iscor and
Eskom to maintain production ratios.
Multiproduct mine, including use of
waste dump
Fuel
Aromatics
Anglocoal
CBM?
Downstream
Plastics
Industry
41
Annexure Three: Limpopo Value-chain Analysis for Platinum Group Metals
Capital to perform
surveys
Capital to purchase
licenses
EXPLORATION
Geological survey
information
Analytical & geology skills
CAPITAL EQUIPMENT
FINANCE
MINE PLANNING
PROJECT PROCESS
ENGINEERING
MANAGEMENT
NEW
SHAFT
SET UP
CONSTRUCTION
(Some Local Jobs
Only)
CONSUMABLES
(Few produced
in Limpopo)
ENERGY LABOUR
Up-Stream
CAPITAL EQUIPMENT
(Mills, flotation cells, Ion exchange etc)
CHEMICALS (Flotation Reagents etc)
ENERGY
MINING
SERVICES
(Some Local
Jobs Only)
Undertaken by Limpopo resource/firms/people
Undertaken by non Limpopo resources/firms/people
SMELTING
REFINING
PROCESS ENGINEERING & DEVELOPMENT
SKILLS (OUTSOURCED)
FACTORY & MANAGEMENT JOBS
BEE through Procurement Opportunities
42
ANNEXURE FOUR