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22 DERA Rohstoffinformationen Investor’s and Procurement Guide South Africa Part 2: Fluorspar, Chromite, Platinum Group Elements Impressum Editors: Dr. Peter Buchholz, Head of the German Mineral Resources Agency (DERA) within the Federal Institute for Geosciences and Natural Resources (BGR) Wilhelmstraße 25 – 30 13593 Berlin Tel.: +49 30 36993 226 Fax.: +49 30 36993 100 [email protected] www.deutsche-rohstoffagentur.de Dr. Stewart Foya, Head of the Department of Mineral Resources Development at the Council for Geoscience (CGS) 280 Pretoria Street, Silverton Pretoria, South Africa Tel.: +27 12 841 1101 Fax.: +27 86 679 8334 [email protected] Authors: Dr. Peter Buchholz (BGR), Dr. Katrin Kärner (BGR), Abdul O. Kenan (CGS), Dr. Herwig Marbler (BGR), Rehan Opperman (CGS), Dr. Simone Röhling (BGR) Project Dr. Herwig Marbler (BGR) coordination: Rehan Opperman (CGS) Contact Dr. Herwig Marbler: [email protected] BGR: Contact Rehan Opperman: [email protected] CGS: Date: October 2015 Cover Images: © Anglo American Platinum Ltd. ISBN: 978-3-943566-26-0 (print version) ISBN: 978-3-943566-25-3 (online pdf version) ISSN: 2193-5319 Reference: Buchholz, P. & Foya, S. (2015) (eds.): Investor’s and Procurement Guide South Africa Part 2: Fluorspar, Chromite, Platinum Group Elements. – DERA Rohstoffinformationen 22: 120 pp.; Berlin. Berlin, 2015 Die Bundesanstalt für Geowissenschaften und Rohstoffe ist eine technisch-wissenschaftliche Oberbehörde im Geschäftsbereich des Bundesministeriums für Wirtschaft und Energie (BMWi). Investor‘s and Procurement Guide South Africa Part 2: Fluorspar, Chromite, Platinum Group Elements Published jointly by the German Mineral Resources Agency (DERA) and the Council for Geoscience, South Africa (CGS) Investor’s and Procurement Guide South Africa 3 Foreword This is the second part of the “Investor’s and Procurement Guide South Africa”, a handbook for investing, procuring raw mineral materials and doing business in South Africa’s mineral industry. It is anticipated that this publication will aid potential investors and buyers in considering South Africa as a business destination, not only for raw materials, but also for related industries. This manual supplements the many publications available on the economic geology and mineral wealth in South Africa and has been designed to guide prospective and current investors, buyers, suppliers and mine equipment exporters through the process of doing business in Africa’s biggest and most dynamic economy. As well as detailing the mineral raw materials Fluorspar, Chromite and Platinum Group Elements, this second part of the handbook provides information regarding recent changes and developments in the economic and judicial framework of the South African mining industry since the release of Part 1 in 2014. South Africa has a long and complex geological history dating back in excess of 3.6 billion years. The country has a vast mineral wealth, undoubtedly due to the fact that a significant proportion of the Archaean and younger rocks have been preserved. The mining of the enormous Witwatersrand gold deposits, commencing in 1886, led to the establishment of South Africa’s well-developed infrastructure and to the sustained growth of an industrial and service sector in the country. With the world’s largest resources of PGMs, gold, chromite, vanadium and manganese and significant resources of iron, coal and numerous other minerals and metals, the minerals industry will continue to play a pivotal role in the growth of South Africa’s economy for the foreseeable future. South Africa is one of the top destinations in Africa for direct foreign investments. South African headquartered companies have been major investors into foreign direct investments on the African continent in the past decade. Despite production disruptions in South African (SA) mines due to labour unrests, global platinum group element (PGE) supplies were largely unaffected in 2013. According to Johnson Matthey’s PGE Review of 2014 (Platinum 2014), platinum supplies increased by a modest 2.5 percent to 181 metric tonnes, with RSA accounting for just over 72 percent of world production. Newly committed investment in primary minerals related projects in South Africa in 2012 was dominated by platinum projects accounting for 54.8 percent followed by other minerals (38.9 percent) and gold (5.4 percent). At least six projects involving these commodities are expected to commence production in 2015. Global chromite reserves were estimated at 9,106 million tonnes (Mt) in 2013, with South Africa account- ing for 74.1 percent of this value. South Africa remains the leading producer of chrome, accounting for 48.8 percent of the total world output of chrome ore. The fluorspar industry in South Africa is still devel oping, with South Africa currently accounting for only 3 percent of total world production. However, there is major potential for fluorspar deposits in and around the Bushveld Complex. Investing in South African companies would allow investors and buyers to gain a foothold in the large emerging markets of Africa. This handbook is a result of a cooperation project between the Council for Geoscience (CGS) of South Africa and the German Mineral Resources Agency (DERA) at the Federal Institute for Geosciences and Natural Resources (BGR) that started at the end of 2011 and has been conducted by experts from BGR/DERA and the CGS. The different natural resources are evaluated in this manual on new occurrences and deposits with investment and supply options for German investors and purchasers in South Africa. Dr. Stewart Foya Dr. Peter Buchholz Head of the Department Mineral Resources Head of the German Mineral Resources Agency of the Council for Geoscience, South Africa (DERA), Germany 4 Investor’s and Procurement Guide South Africa Investor’s and Procurement Guide South Africa 5 Contents Foreword 3 1 Introduction 13 Aim of the study, background and comments 13 1.1 Economic, judicial and political frame of the South African mining industry (latest developments since 2013) 13 1.1.1 Key government legislation and policies regarding the mineral industry in South Africa 13 1.1.2 Mineral and petroleum resources development amendment bill (MPRDA) of 2013 13 1.1.3 References 15 2 Fluorspar 16 2.1 Definition, Mineralogy and Sources 16 2.1.1 Definition 16 2.1.2 Mineralogy 16 2.1.3 Sources 16 2.2 Specifications and User 17 2.3 Supply and Demand 18 2.3.1 Global Situation 18 2.3.2 Germany 19 2.3.3 Resources in South Africa 19 2.3.4 Vergenoeg Fluorspar Mine (Gauteng) 23 2.3.5 Nokeng Fluorspar Mining Project (Sepfluor Ltd.) 29 2.3.6 Buffalo Fluorspar Mine (Rooiberg Stone Pty Ltd.) 31 2.3.7 Witkop Fluorspar (Coffey mining) 33 2.3.8 Doornhoek Fluorspar Project 34 2.4 Requirements and Evaluation 36 2.5 References 38 3 Chromite 40 3.1 Definition, Mineralogy and Sources 40 3.1.1 Definition 40 3.1.2 Mineralogy and Sources 40 3.2 Specifications and Use 40 3.3 Supply and Demand 41 3.3.1 Global Situation 41 3.3.2 Germany 43 3.3.3 South Africa 46 3.4 Primary Resources of Chromite in South Africa 47 3.4.1 Deposit Types 47 3.4.2 Chromite Mining History of the Bushveld Complex 49 3.4.3 Operating Mines 50 3.4.4 Operations with German Participation 54 3.4.5 Exploration Projects 59 3.4.6 Other Occurrences 61 3.4.7 Processing of Chromite Ore 62 3.5 Requirements and Evaluation 66 3.6 References 66 6 Investor’s and Procurement Guide South Africa 4 Platinum Group Elements (PGE) 69 4.1 Definition, Mineralogy and Sources 69 4.2 Specifications and Uses 69 4.3 Supply and Demand 70 4.3.1 Supply 70 4.3.2 Demand 73 4.4 Primary PGE Deposits in South Africa 74 4.4.1 PGE Mining History in the Bushveld Complex, South Africa 74 4.5 Mining and Processing 75 4.5.1 Processing 75 4.5.2 Mining – Overview of Companies and Projects 76 4.5.3 Eastern Bushveld Complex (eastern limb) 80 4.5.4 Western Bushveld Complex (western limb) 86 4.5.5 Northern Bushveld Complex (northern limb) 89 4.6 Requirements and Evaluation 97 4.7 References 99 4.8 PGE Resource Potential of Oxidised Ores 101 4.8.1 Geochemistry and Mineralogy of Oxidised PGE Ores 102 4.8.2 Results 106 4.8.3 Extraction Methods 107 4.8.4 References 108 5 Secondary Chromite and PGE Potentials in Mine Tailings 110 5.1 Mineral Resource Potential 110 5.1.1 Methodology 110 5.1.2 Results 111 5.2 Economical Aspects 112 5.2.1 Tailings Treatment Operations 112 5.2.1.1 Platinum Mines 112 5.2.1.2 Chrome Mines 114 5.3 References 119 Acknowledgements 120 Investor’s and Procurement Guide South Africa 7 Figures Fig. 2.1: Fluorspar Value chain: sources, uses and conversion pathways of commercial fluorine (afterV ILLALBA et al. 2008). 17 Fig. 2.2: Global mine production of fluorspar by country in 2013. 18 Fig. 2.3: Global fluorspar consumption in 2011 by geographic regions (after ROSKILL 2013). 19 Fig. 2.4: German total import of fluorspar – metallurgicalgrade and acidgrade – from 2012 to 2014. 20 Fig. 2.5: German import of acidgrade fluorspar (acidspar) from 2012 to 2014. 20 Fig. 2.6: German import of metallurgicalgrade fluorspar (metspar) (2012 to 2014). 21 Fig. 2.7: German total export of fluorspar – metallurgicalgrade and acidgrade – from 2012 to 2014. 21 Fig. 2.8: German export of acidgrade fluorspar (acidspar) from 2012 to 2014. 22 Fig. 2.9: German export of metallurgicalgrade fluorspar (metspar) from 2012 to 2014. 22 Fig. 2.10: South African production of fluorspar from 1945 to 2013. 23 Fig.