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Vinpro approaches courts to save the South African wine industry

As one of the oldest agricultural industries in the country, which supports the livelihoods of 269 000 employees, generates R55-billion in revenue for the economy and builds a strong brand reputation as a unique asset for the country, the South African wine industry has become part of our cultural and economic fabric.

During the past year our industry has worked tirelessly to be part of the solution when our country found itself in the grip of the deadly Covid-19 pandemic. This included collaborating with government and proactively implementing preventative measures from farm to retail to safeguard the lives and livelihoods of the people working throughout our value-chain and the broader community.

Despite continuous engagement with government to curb the spread of the virus through the implementation of a risk-adjusted approach to re-opening the economy and addressing the social ills of alcohol abuse through a social compact, our proposals were not taken into account when the third ban was introduced on 28 December 2020. Government has also not been transparent with us on justifying the continued ban, nor did they give any explanation or clarity on the timeline for a review of this ban. This makes planning and contingency plans impossible.

This proudly South African industry, which also strongly relies on tourism and hospitality, now finds itself in a dire position after a ban of 19 weeks since March 2020. This resulted in a loss of more than R8-billion in direct sales and the possible closure of cellars and producers, threatening 27 000 jobs and putting the most vulnerable in our communities in a poverty trap which will have far reaching socio-economic outcomes that will place an even greater strain on our healthcare system.

Furthermore, with the 2021 harvest commencing this week, the industry now has more than 640 million litres of stock of which 300 million is uncontracted. This poses a material risk of insufficient processing and storage capacity for the new harvest and threatens the sustainability of the wine industry.

While we share government’s concern over the devastating effect of this pandemic and support meaningful measures to flatten the curve, we do not support the continued outright ban on the sale of wine while alternative interventions are available to mitigate risks.

Faced with the devastating impact that the third ban has had on the wine industry, Vinpro was left with no choice but to approach the Cape High Court.

Vinpro is not saying a liquor ban may not be justified when hospitals and particularly trauma units are under pressure. However, we believe that not only has the wrong level of government been dealing with the retail sale of liquor during the national state of disaster, but government has used and maintained nationwide bans which are overbroad, unnecessary, unjustified and, indeed, counter-productive.

A more flexible, nimble approach is needed, based on credible empirical data, where the provincial executive should be empowered to deal with the retail sale of liquor for the rest of the pandemic, because provincial authorities are normally responsible for regulating the sale of liquor and in charge of healthcare and provincial hospitals, thus they are better equipped to manage the delicate balance between lives and livelihoods.

Although the liquor ban is intended to ensure that hospitals have the capacity to treat those who become ill, the pandemic affects provinces differently at any given point in time and capacity requirements in hospitals will therefore differ across the country. Despite this, government has never differentiated between provinces when it comes to implementing or lifting of the liquor ban. Instead, a nationwide ban has been imposed and then again lifted, without regard for the circumstances in individual provinces.

Urgent interim relief will be sought which would afford the Premier of the Western Cape the power to adopt deviations to enable off- and on-consumption sale of liquor in the province. Ultimately similar relief will be sought in respect of other provinces. The matter is set down for hearing on 5 February 2021.

Vinpro is relieved that the numbers of new infections, active cases and hospital admissions are now dropping fast across the country, but particularly in the Western Cape. In these circumstances, the liquor ban is simply no longer justified in the Western Cape. Accordingly, to the extent that the situation does not change for the worse, and if the liquor ban is still in force in the Western Cape by 5 February, the Western Cape High Court will be asked to invalidate Minister Dlamini-Zuma’s ban in the Western Cape with immediate effect.

As honest brokers, we strongly believe in the power of a shared vision where we have the same objectives – a healthy and prosperous South Africa.

We will continue our support of government in the fight against Covid-19, while working for the economic survival of our sector and the people who rely on it for their livelihoods.

Opportunities for business growth into southern Africa

The Sasol One Site in Sasolburg was founded in 1950 and converted from coal gasification in 2004, and now uses more efficient natural gas in its production processes (credit: Sasol)

A regional overview of the Free State Province

By John Young

As of February 2020, nearly 100 new permanent jobs had been created within the Maluti-a-Phofung Special Economic Zone (MAP SEZ), the strategically located area on the N3 highway designed to attract new investment to the Free State Province.

Sectors prioritised at the MAP SEZ include logistics, ICT, automotive, pharmaceuticals, manufacturing and agro-processing. The 1000 ha site has four zones: agro-processing, light industrial, heavy industrial and a container terminal. Control of the project now rests with the provincial Department of Small Business Development, Tourism and Environmental Affairs (DESTEA).

Other areas that are being upgraded to provide infrastructure to encourage manufacturing are the Phuthaditjhaba Industrial Park and the Botshabelo Industrial Park. The N3 is South Africa’s busiest road and the Highway Junction truckstop at the entrance to Harrismith claims to be Africa’s biggest. More than 1 500 vehicles pass through every day and three forecourts cater to three fuel brands. Refuelling, storage and handling take place here, highlighting the province’s strengths in logistics as the country’s most central province.

The country’s two great highways pass through the province. The N3 links the ports of Richards Bay and Durban with the industrial heartland and the N1 provides north-south connectivity. The provincial capital, Bloemfontein, is another logistics hub. Three other national highways intersect the province which is also well served by rail and air links. The Bram Fischer International Airport serves the provincial capital.

Links to the west (Kimberley and on to Namibia) and east (to Lesotho) underpin the planning behind the N8 Corridor concept which covers Bloemfontein, Botshabelo and Thaba Nchu. A plan for the coordinated development of the N8 Corridor has been approved by a range of bodies and is being funded by the Development Bank of Southern Africa (DBSA) and the Mangaung Metropolitan Municipality.

Projects and purchases

The Omnia Group is present in 45 countries, has more than 4 400 employees and a net asset value of R9.7-billion (March 2020). The company’s agricultural and chemicals divisions have a large presence in the northern Free State town of Sasolburg and the company has recently acquired a US-based firm that specialises in patented agriculture biological products, further expanding its geographical footprint and product range.

International fuel, gas and chemicals company Sasol regularly invests in new technologies and in expanding production of its many products.

Renergen, the owners of the Virginia Gas Project, announced in March 2020 that their findings had “radically improved” the company’s drilling plan. One of the key facts to emerge is that the gas contains helium of up to 12%, a good percentage. Despite the drawback associated with Covid-19, Renergen also announced that it was going to roll out filling stations across South Africa to cater to companies in the trucking industry converting to gas.

Mining is reduced in importance but remains a significant employer. Harmony Gold has several assets in the province and Sibanye-Stillwater has undertaken a feasibility study on a property adjacent to its existing Beatrix mine.

In agriculture, the Free State is looking forward to the implementation of the African Continental Free Trade Agreement (AfCFTA), the free trade agreement that was stalled by the Covid-19 pandemic. The Free State’s agricultural export basket is well suited to trading with African states and strategies are being considered to promote apples, asparagus, cherries, cut flowers, sorghum, venison and wine.

The Free State produces significant proportions of South Africa’s wheat (30%), sunflowers (45%) and maize (45%) and is ranked third in contribution to national GDP in agriculture.

The Free State shares borders with six other provinces, in addition to the Mountain Kingdom of Lesotho. A summer-rainfall region with a mean annual rainfall of 532 mm, the Free State’s climate, soil types and topography vary greatly within the province, with plains in the west and mountains in the east.

The western and southern areas are semi-desert, with some Karoo vegetation occurring in the south. The southernmost region of the Free State is a largely dry area with open grasslands predominating, although it is also home to the Gariep Dam, South Africa’s largest dam.

The Gariep Dam

Municipalities in Free State

The Free State has one metropolitan municipality (Mangaung), four district municipalities and 19 local municipalities.

Mangaung Metropolitan Municipality

Mangaung Metropolitan Municipality is a Category A municipality which governs Bloemfontein, Botshabelo and Thaba Nchu. The sixth-largest city in the country, the Mangaung municipal area covers more than 6 263 km² and has a population of about 850 000 people. Bloemfontein is responsible for about 25% of provincial GDP.

Xhariep District Municipality

Towns: Trompsberg, Zastron, Philipollis, Smithfield, Wepener

The southernmost region of the Free State is a largely dry area with open grasslands predominating, although it is also home to the Gariep Dam, South Africa’s largest dam. The dam is also the site of small hydro-power and aquaculture projects. The nearby Tussen die Riviere Nature Reserve and the Mynhardt Game Reserve are popular. Crops are produced in the northern parts of the district and sheep farming is the biggest activity in the south. Diamonds, gravel and clay are mined at Koffiefontein. Jagersfontein is one of the first places where diamonds were found.

Lejweleputswa District Municipality

Towns: Welkom, Virginia, Boshof, Christiana, Bultfontein, Bothaville

Mining is the most important economic activity in this area, also known as the Free State
Goldfields, but it is also the most important maize-growing area in South Africa. A large natural gas field has been discovered on what used to be gold turf. Bothaville hosts the annual NAMPO maize festival and the headquarters of Grain SA. Welkom is the major urban centre in the district. The area has tourist assets such as a holiday resort on the Allemanskraal Dam, the Goldfields Wine Cellar in Theunissen and the Willem Pretorius Game Reserve.

Fezile Dabi District Municipality

Towns: Sasolburg, Parys, Kroonstad, Frankfort, Heilbron, Viljoenskroon

The chemical complex at Sasolburg is the economic driver in the district, which shares a border with Gauteng province along the Vaal River. Kroonstad is the district’s second-largest town and has a number of engineering works and a railway junction.

A good proportion of South Africa’s grain crop is sourced from this district and when the vast fields of sunflowers and cosmos flowers are in bloom, a marvellous vista is created. The Vaal River presents opportunities for yachting, rafting and resort-based enterprises. Parys is a charming town and Vredefort is home to a World Heritage site – the Vredefort Dome where a meteor crashed to earth.

Fezile Dabi District Municipality is the biggest contributor towards the provincial GDP, contributing approximately 35%. The Fezile Dabi area is mostly dominated by the industrial power of Sasol, with the manufacturing of refined petroleum, coke and chemical products adding largely to its GDP.

Thabo Mofutsanyana District Municipality

Towns: Phuthaditjhaba, Bethlehem, Ladybrand, Clarens, Harrismith, Ficksburg

Tourism and fruit farming are the two principal economic activities of this area which is characterised by beautiful landscapes: the Maluti and the Drakensberg mountain ranges, wetlands in the north, well-watered river valleys and the plains of the north and west. The most famous asset is the Golden Gate National Park.

Industrial activity is undertaken at Harrismith and Phuthaditjhaba, where the Free State Development Corporation is promoting investment. The Maluti-a-Phofung Special Economic Zone (SEZ) at Harrismith is a multi-modal transport and logistics hub. The commercial centre of the district is Bethlehem while Clarens and Ficksburg have become famous for their artists and cherries respectively.

 

Cape Town boats involved in space travel

Credit: Gemini Marine

Boats built in Cape Town are collecting astronauts in the waters of the Gulf of Mexico after they splash down. Epping-based Gemini Marine has signed a deal with Elon Musk’s SpaceX to supply recovery boats for astronauts returning from the International Space Station. A selection of international clients includes the UK Ministry of Defence, the Royal New Zealand Navy, the United Nations and the Singapore Special Forces.

Marine industry insight

The South African Boat Builders Export Council (SABBEX) reports that the sector is particularly strong in catamarans and yachts, but a growing variety of boats are being built. These includes custom and semi-custom built monohulls, powerboats, commercial vessels, sport-fishing boats and inflatables.

Two Oceans Marine manufactures both power and sailing catamarans in 4 500 m² of factory space on two different premises, in Cape Town harbour and in Paarden Island. The company runs an internship programme with False Bay TVET College.

Damen Shipyards Cape Town is building three inshore patrol vessels for the South African Navy, the first of which will be delivered in 2021. The vessels will be used to secure South Africa’s waters against threats such as illegal fishing, smuggling and piracy.

Since 2014, investments worth R30-billion have been made into the sector and created more than 7 000 direct jobs (Invest Cape Town). The Western Cape Department of Economic Development and Tourism (DEDAT) reports that in 2016 the oil, gas and marine sector supported 8 320 jobs and contributed R1-billion to the province’s gross value add.

The Western Cape has enthusiastically embraced the national strategy called Operation Phakisa (“hurry up” in Sesotho). The 2033 target is for the share of the Maritime Economy to South Africa’s gross domestic product (GDP) to grow by 250% (and perhaps as much as 350%) compared to its current value, to a figure between R129-billion and R177-billion. A million new jobs are expected to be created.

The construction of an offshore supply base in the Port of Saldanha on a dedicated quay is an excellent example of the impact of Operation Phakisa. Saldehco, a privately-owned South African special purpose vehicle with foreign investors, submitted a tender in 2016 through the Transnet National Ports Authority (TNPA) to build this infrastructure to support the growing oil and gas industry.

Large industrial operations already exist at Saldanha and the Port of Saldanha Bay is the portal for the export of South Africa’s iron ore. The Saldanha Bay Industrial Development Zone (SBIDZ) is becoming a hub for a range of maritime repair activities and oil rig maintenance and repair.

The National Department of Trade, Industry and Competition (dtic) and the DEDAT have collectively invested R500-million in core infrastructure and a lease agreement has been signed with TNPA. The SBIDZ fits neatly into two overarching visions: Operation Phakisa and Project Khulisa, the targeted growth strategy of the Western Cape Provincial Government which includes servicing and repairing of oil rigs as a priority.

The marine transport committee of the South African Oil and Gas Alliance (SAOGA) is preparing South Africa to reap the potential of the sector. It has developed 18 initiatives across three categories: infrastructure and operations, skills and market growth.

During the Covid-19 lockdown, the Port of Cape Town did not shut down for a single day. Working teams were reduced and reallocated but the vital work of loading and unloading supplies was done. A task force with a wide range of representatives from government, business and port authorities is working on reducing congestion at the harbour.

A renewed focus on ship repair through facilities such as the Sturrock and Robinson drydocks is on the cards for the Port of Cape Town, which has a diverse offering through its Container Terminal, Multipurpose Terminal, Liquid Bulk Terminal and Fresh Produce Terminal.

The Port of Cape Town (Credit: Transnet National Ports Authority)

The Western Cape fishing industry

About 310-million kilograms of fish is consumed annually by South Africans, of which about half is caught locally. The main fish are hake and sardines and almost all of that is harvested in Western Cape waters by deep-sea trawlers.

The fishing industry earns R3.4-billion in foreign earnings annually and employs 26 500 people across 22 sectors, the main ones being deep-sea trawling and aquaculture (JSE). The aquaculture industry is currently small, but since 2014 investment commitments of about R700-million have been made.

The allocation of commercial fishing rights in 12 sectors that was due to happen in 2020 has been postponed to December 2021. It is likely that the quotas of larger fishing companies will be reduced in favour of small-scale fishing companies.

There have been several changes in ownership in the fishing industry, most likely linked to the upcoming determination of new fishing rights in which black shareholding will be a factor. The acquisition by black-controlled Sea Harvest Group of Viking Fishing is part of a larger trend.

Tiger Brands has unbundled its 42% stake in Oceana Group. Oceana holds the popular pilchards brand Lucky Star, which enjoys 80% of market share in South Africa, and has the highest market value of fishing companies in South Africa. The Oceana Group recently purchased Foodcorp’s fishing rights and a US fishmeal and oil company, Daybrook.

Growing solar energy in Africa

The 13th annual Africa Energy Indaba will assemble representatives from development banks, investment funds, solar developers, IPPs, EPCs and other solar stakeholders to engage in comprehensive dialogues to solve Africa’s solar energy challenges in an endeavour to see projects realised.

The virtual conference is sure to enlighten attendees on what African leaders and businesses are doing to enable the supply of reliable and sustainable energy for the continent. This definitive global platform is focused on connecting solar project development and finance and investment in the four leading solar electrification segments (utility-scale, commercial & industrial, mini/microgrids and off-grid).

According to the industry experts, Africa has shown great progress in the development of its solar energy markets over the years. The continent has experienced a growth of over 1.8 GW of new solar installations, with 1.4 GW coming from photovoltaic (PV) installations, which was a significant jump from the 786 MW that was brought online in 2017.

In 2016, South Africa had 1,329 MW of installed solar power capacity and this capacity is expected to reach 8,400 MW by 2030. Two new solar plants now feeding 132 MW into South Africa’s grid and two utility-scale solar plants in the Northern Cape, Aggeneys Solar and Konkoonsies II Solar, have commenced commercial operations, adding a collective 132 MW to South Africa’s generation capacity.

“Addressing Africa’s large and persistent power deficit is key to achieving economic and social targets. There is significant potential for solar power, both at the utility and off-grid scale, to assist in reducing this shortfall,” says the Africa Energy Indaba MD, Liz Hart. This is owing particularly to the given high solar irradiation in many countries, as well as the declining price of PV equipment in recent years.

Governments increasingly see both forms of solar power as critical to their electrification objectives. In an endeavour to increase investment on the continent’s solar front, African ministers are encouraging international investors to participate in solar Power Purchase Agreement (PPA) processes and empowering them to own and operate solar farms in their own capacity.

Many African nations have employed solar energy as a solution to tackling climate change, keeping abreast of their development and ensuring food security. Extensive research from some of the world’s most renowned energy experts has elucidated that no other energy source, including hydro and wind, can provide power and have an impact as sustainable, reliable, and efficient as solar.

However, successful implementation of solar is futile without regional cooperation to enable expediting the process of implementing solar under a single framework. As most municipalities operate completely independently from one another, this consequently implies that they are unable to foresee or understand the benefits or the process pertaining to such regional integration initiatives.

For more information, visit https://www.africaenergyindaba.com/

Africa Travel Week unveils 2021 roadmap to reignite travel and tourism in Africa

  • WTM Africa and suite of sister shows to run as a virtual event from 07-09 April 2021 with a live element from 01-03 September during Tourism Month.
  • The virtual and live events form part of a 365-day plan to offer a significant ROI for exhibitors and international buyers.

Cape Town, 26 January 2021 – Africa Travel Week (ATW) has unveiled an audacious plan for its 2021 suite of shows, which includes several value-add opportunities, in addition to WTM Africa, which will run as a 100% virtual exhibition from 07-09 April 2021.

“The plan for WTM Africa has always been about offering value beyond the show floor. This year, we’re focussing heavily on that, with a robust plan that offers significant ROI across 365 days, instead of three,” says Megan Oberholzer, Portfolio Director: Travel, Tourism and Creative Industries at Reed Exhibitions Africa.

In addition to the virtual show in April, which consists of 1-to-1 meetings, content sessions and speed networking, ATW has lined up a collection of additional events throughout the year, which include:

  • Educational content webinars from May to August.
  • Africa Travel Week: Connect in the City Live from 1-3 September, including on-site experiences in the official Host City of Cape Town.
  • A series of virtual masterclasses from September to November.

Said Oberholzer: “Our plan takes on a blended approach where travel trade professionals benefit from connecting with their industry peers at face-to-face meetings later on in the year. Safety and wellbeing remain our number one priority and we will adjust this element of our offering accordingly.”

The three-day Africa Travel Week Live which coincides with Tourism Month, will comprise:

  • Familiarisation tours. ATW will host international travel media and buyers in the City of Cape Town to experience tourism products first-hand.
  • A dedicated travel and tourism conference with a top-notch speaker programme of industry thought leaders and experts.
  • Destination training sessions for Hosted Buyers
  • Our ever-popular speed networking sessions where buyers are split according to region and product interests.
  • A networking evening for attendees to meet and reconnect with industry friends and peers face-to-face.
  • The African Travel & Tourism Awards, honouring industry pioneers.

The blended format of WTM Africa throughout 2021 will also apply to its suite of sister shows including International Luxury Market Africa (ILTMA), International Business Tourism Market Africa (IBTMA), The Sports & Tourism Exchange (SETE), Africa Tourism Investment Summit (ATIS), Travel Forward and EQUAL Africa.

Attendees and industry professionals may remain connected and informed throughout 2021 via atwconnect.com, ATW’s dedicated resource hub jam-packed with free digital tools, industry news and updates.

“Our industry is inspired to make travel happen again and we want to be a part of that journey to rebuild the travel and tourism industry in 2021 by being active with initiatives that help our industry connect throughout the year,” said Oberholzer. “We need to keep the momentum up to ensure travel to Africa remains top of mind, which is one of the reasons why I’m delighted that we’re able to create a 365-day initiative.”

Meaningful collaboration and partnerships key to business growth

In line with Free State Growth and Development Strategy and the mandate of broadening access to economic opportunities for the Free State-based business sector, the Free State Development Corporation (FDC) will continue to unlock business opportunities for both local and foreign direct investors.

The World Bank Group flagship report, June 2020, projected a global GDP contraction of 5.2%. The South African real GDP is also expected to go down by 7.2% in 2020 due to the economic restrictions that were implemented by government through its risk-adjusted alert levels in response to the Covid-19 pandemic. The rand has depreciated significantly against the US dollar since the beginning of the year. All of these challenges present a very difficult road ahead. The economic recovery will need all the social partners to hold hands and work together.

Both the national and provincial government have provided some relief to businesses in one form or another. The FDC has also partnered with government departments to assist businesses in distress in order to cushion the blow caused by the global health crisis.

The Covid-19 pandemic has dealt a tremendous blow to our SMMEs. Many have been forced to shut their operations for months due to the lockdown regulations. This has had a negative impact on their survival and sustainability with some downsizing their operations, while others have had to cease operations. The FDC continues to foster partnerships with various stakeholders from municipalities, government departments and other state entities with the aim of advancing SMME development, promoting exports, attracting investments within the province and most importantly, saving businesses.

As an organisation, we believe that the best way to grow the Free State and the country is through meaningful collaboration and partnerships which allows us to pool all our resources together for the betterment of our entrepreneurs.

This Free State Business 2021 publication presents the Free State’s value proposition as a business and tourism destination. Key opportunities in the Free State include the following:

  • A leading agricultural commodities producer presents significant opportunities across the agro-processing value chain.
  • Aquaculture activities associated with the Gariep Dam.
  • Sheep farming and related value-chain processing.
  • Tourism development potential leveraging off heritage sites and assets.
  • Engineering opportunities within the Lejweleputswa District as a result of excellent engineering training and capacity-building within the mining sector.
  • Jewellery beneficiation.
  • The Maluti-A-Phofung Special Economic Zone (MAP SEZ), situated at Tshiame in Harrismith
    in the Thabo Mafutsanyane District in the Eastern Free State is targeting investments into the province. This SEZ is situated midway between the biggest port in Africa, Durban, and the biggest market in Africa, Gauteng.
  • The Industrial Parks in Sasolburg, the anchor town of the Metsimaholo Municipality in the Fezile Dabi District in the Northern Free State are available for rental to industrial tenants.
Thabo Lebelo, CEO of the FDC

We will utilise all our resources in creating a conducive environment for entrepreneurs to thrive and unleash the potential of the provincial economy to grow through our commitment to:

  • Relationship building.
  • Commitment to our customers and investors.
  • Economic transformation for the common good of all our people.
  • Assisting investors with accessing incentives and grants where available.

With the continued support from the provincial government, we will indeed grow the Free State.

Mining Indaba Virtual announces speaker line-up from key mining sectors

London: Investing in African Mining (Mining Indaba), part of Hyve Group Plc announced the exceptional line-up of keynote speakers for Mining Indaba Virtual, which will take place 2-3 February 2021.

The organisers are extremely delighted to confirm four heads of state will be delivering keynote addresses, including H.E. Cyril Ramaphosa, President of South Africa, H.E. Julius Maada Bio, President of Sierra Leone, H.E. Mokgweetsi Masisi, President of Botswana and H.E. Félix Tshisekedi, President of Democratic Republic of Congo (DRC) discussing the opportunity for international investment and much more for their countries.

Joining the heads of state on the expanding list of speakers are CEOs from major mining companies, government leaders and senior representatives from across the global mining industry. Tackling topics from reigniting mining capital: ESG investing in a Covid-recovery world, harnessing technology and automation to grow economies to opportunities for battery metals in the global reboot, green metals, PGMs and global decarbonisation and more.

This year’s virtual event has been designed to reflect the priorities of helping to rebuild and shape the future of the industry. Spread over two half days, it will boast a highly exceptional line-up of industry speakers. “Mining Indaba has been built on 27 years of industry support, and this year, although virtual, we want to help to continue to support the industry during such a turbulent year. The programme truly reflects the industry’s needs and will support the industry for the year ahead.” Tom Quinn, Head of Content, Mining Indaba and Africa Oil Week.

The line-up of speakers joining heads of state includes:

  • Hon. Gwede Mantashe, Minister of Minerals Resources & Energy, South Africa
  • Mark Cutifani, Chief Executive, Anglo American
  • Roger Baxter, CEO, Minerals Council South Africa
  • Mxolisi Mgojo, CEO, Exxaro Resources
  • Bold Bataar, CEO Energy & Minerals, Rio Tinto
  • Neal Froneman, CEO, Sibanye-Stillwater
  • Alfred Baku, Executive Vice President, Gold Fields
  • Nigel Beck, Head of Sustainable Finance, Standard Bank
  • Shirley Webber, Managing Director – Head of Natural Resources, Absa Bank
  • Steven Phiri, CEO, RBPlat
  • Natascha Viljoen, CEO, Anglo American Platinum
  • Rebecca Campbell, Partner, White & Case
  • Humphrey Oriakhi, Managing Director, PAC Capital Limited
  • Adrian Hammond, Lead PGM Analyst, SBG Securities

Geared towards building ‘Resilience and Regrowth: Adopting the New Mindset for African Mining’ to help rebuild and shape the future of the industry.

This free to attend online conference is now CPD certified, meaning attendance counts towards professional development, featuring high-level content including pioneering insights, multi-stakeholder strategic conversations, presidential addresses and more.

Registration for the Mining Indaba Virtual has now opened, the event is free to attend. For more information about the programme, visit the website here.

 

Offshore gas finds could transform the Eastern Cape energy landscape

Wind tower blades arriving at the Port of Ngqura. Image: Keith Arkins via Eastern Cape Business 2020

Although the Eastern Cape is making a name for itself as the home of wind power, solar energy and related manufacturing are making a bid for a place in the sun. Scatec Solar has commissioned a plant in Burgersdorp. The 75 MW plant has panels mounted on single axes, enabling them to track the sun and optimise electricity generation by a further 20%.

A solar tracking system manufacturer based in Port Elizabeth has achieved a rare level of certification at its purpose-built climate test chamber. PiA Solar has won several contracts for large solar farms in the national Renewable Energy Independent Power Producer
Procurement Programme (REIPPPP).

The East London Industrial Development Zone (ELIDZ) is home to renewable energy manufacturing facilities such as the ILB Helios Solar Panel Assembly.

If recent offshore gas finds in the Southern Outeniqua Basin (Brulpadda) prove as rich as first indications suggest, and if companies can find the money to extract it, the potential to transform the Eastern Cape is enormous. Both the Coega SEZ and the East London IDZ are geared for maritime services and the value chain of the oil and gas sector is complicated and long.

Another possible gamechanger is the decision by national government to name the Coega SEZ as the potential site for a 1 000 MW Liquefied Natural Gas (LNG) plant. The value to the regional economy of the project is estimated at R25-billion. A 342 MW gas-fired power plant (Dedisa) has started operating at Coega, and there are plans to expand this sector.

The Eastern Cape is now home to 15 wind farms. More than half the wind farm projects so far approved in the REIPPPP have been allocated to the province. The Kouga area west of Jeffreys Bay and the Cookhouse/Bedford area about 95 km north-west of Makhanda (Grahamstown) represent two wind power hubs, with a collective capacity of 1 185 MW.

South Africa’s National Development Plan (NDP) requires 20 000 MW of renewable energy by 2030 and wind power technology, together with solar photovoltaic, are the two primary methods of reaching that target.

One of the unfortunate side effects of the refusal by national utility Eskom to buy renewable power for two years was the closing down and auctioning off of a wind tower manufacturing plant in the Eastern Cape. DCD Wind Towers was a joint venture between the DCD Group and the Industrial Development Corporation (IDC) at Coega.

The South African Wind Energy Association (SAWEA) has issued a Commitment Statement which noted that the REIPPPP has a “built-in demand for local procurement”, not only offering business opportunities to local companies, but also incentivising the industry to identify and support emerging entrepreneurs.

The rollout of renewable energy has met some resistance in South Africa from constituencies as diverse as coal-truck drivers and advocates of nuclear power. In response, renewable energy advocates cite not just investment figures, but they note how much good work has been done in communities.

Figures released by SAWEA showed shareholding for local communities reached an estimated net income of R29.2-billion over the lifespan of the projects. Some 14 000 new jobs are expected to be created, mostly in rural areas, and more than R30-billion has already been spent on Black Economic Empowerment (BEE) in the construction phase.

Part of the SAWEA Commitment Statement reads, “Our aim over time is to transform and indigenise leadership at all levels in the South African Renewable Energy sector.”

The average lead time in the projects that have so far been approved in the province is two years, with local content averaging out at about 47%. When the projects are complete, R142.9-billion will have been spent on procurement, R65.7-billion of which will be local.

Wind projects in the province include Globeleq’s 138 MW Jeffreys Bay facility, the 140 MW Cookhouse project (African Clean Energy Developments) and two run by Cennergi at Tsitsikamma (94 MW) and Bedford (134 MW). Resources company Exxaro recently bought out the Indian partner with which it initially partnered to create Cennergi, Tata Power. There are several other projects with capacities ranging from 20 MW to 97 MW.

POWERX has signed up with AKM Foods to supply power to all the KFC outlets in Nelson Mandela Bay. POWERX trades in renewable energy through licences granted to it by the national energy regulatory authority, NERSA. By aggregating power purchases, the company is able to mitigate risk in a way that an individual purchaser may not be able to. POWERX now supplies over 40 national and local customers in Nelson Mandela Bay and its aim is to expand the customer base.

The support of two of South Africa’s biggest institutional investors, the Industrial Development Corporation (IDC) and the Public Investment Corporation (PIC), has been crucial in getting the renewable energy sector off the ground. They have also played a role in helping communities fund their participation in community trusts. According to Business Day, the PIC has so far invested in 16 unlisted projects and its total investment stands at R11-billion. The IDC’s 24 projects are valued at R14-billion and will contribute 1 100 MW to the national power grid.

Online resources:

Joburg Indaba: Modernisation in Mining, 24th February, online

Modernisation in Mining

Digital transformation * 4IR * Technology Innovation
24 February 2021, online

The Joburg Indaba team is pleased to announce its first online discussion for 2021, Modernisation in Mining, to be held on the morning of 24th February.

This is a timely and critical discussion of increasing importance to the mining industry. Not only is modernisation of the mining industry beneficial for productivity and operational efficiency, but it also improves safety and the health of employees, increases sustainability and extends the life of mine.

Covid-19 has accelerated the drive to implement 4IR technologies in mining, such as IoT, AI, analytics and automation. However, questions remain regarding the implications for employees, the challenges of reskilling the workforce, which technologies to use and timeframes for implementation and ROI.

All of these issues and more will be discussed at the Modernisation in Mining online discussion, taking place on the morning of 24 February 2021. Chaired by Bernard Swanepoel, the session will include the results of the recent survey conducted by PwC and the Minerals Council of South Africa on the impact of 4IR technologies on mining.

This will be followed by a discussion with senior representatives from both mining companies and major technology suppliers, who will discuss the potential of new technologies to deliver tangible benefits as well as progress being made by mining companies on modernisation initiatives and how they are tackling the redeployment/re-skilling of their workforce.

Sponsored by PwC, Modernisation in Mining is one of the ongoing discussions held by the Joburg Indaba team throughout the year.

For more information and to register, please go to: https://www.joburgindaba.com/other-indabas/modernisation-in-mining

For sponsorship opportunities, please contact Stuart Alderson-Smith:
sponsorship@resources4africa.com

Sponsors of Modernisation in Mining: PwC

“by the industry for the industry”

Mining Industry Partners of the Joburg Indaba include:
African Rainbow Minerals, Anglo American, Exxaro Resources, Harmony Gold Mining Company Limited, Implats, Menar, Minerals Council South Africa, Sasol Mining, Seriti Coal, Sibanye-Stillwater, South32, Vedanta Zinc International.

Sponsors of the Joburg Indaba include:
Lead Sponsor – PwC
Corporate Partner Sponsor – Accenture
Premium Sponsors – African Sun Mining, DRA Global, Fraser Alexander, IsoMetrix, OIM Consulting, Weir Minerals
Networking Sponsors – Deloitte, SRK Consulting, Worley

Student accommodation is a growing subsector

The University of Fort Hare is the site of a huge student housing project (above). The second phase of the student village will cost R400-million. Student accommodation specialists STAG African will create a student centre and postgraduate options, having delivered 610 beds in the first phase.

When the project is complete, the university will have the highest ratio of beds to students in South Africa, with a total of 2 047 beds. The project is jointly funded by the European Union, the National Department of Higher Education and Training and the Development Bank of Southern Africa.

STAG African is responding to a national (and continental) trend because one of the fastest-growing segments of the property market is student accommodation. Ambitions to keep making tertiary education more accessible to a broader range of students has been successful since South Africa became a democracy in 1994 and this has created a need for accommodation. The Department of Higher Education and Training estimates that there is a need across South Africa for 250 000 beds for university students.

These factors apply to the province’s other universities such as Nelson Mandela (Port Elizabeth and George), Rhodes (Grahamstown) and Walter Sisulu (four campuses including Mthatha and East London), together with all the TVET colleges.

Fort Hare University recently completed a library building in East London that also serves the students of Walter Sisulu University and UNISA. Construction company GVK-Siya Zama faced some challenges on a constricted site, but delivered basement parking and four levels of offices, boardrooms, study areas and a canteen. The library is on three levels.

The same company was active on the project to rebuild Woodridge College after that institution was devastated by fire in 2016. Another project that required the demolition of buildings was at David Livingstone High School in Port Elizabeth. This R64-million project created a new double-story classroom block, kitchen and dining hall.

Housing

Coastal properties almost always attract a premium, but a new trend towards “semigration” is further boosting prices. Semigration refers to families who live in towns like Knysna or George but the bread-winner commutes to Johannesburg. Towns such as St Francis Bay, Jeffreys Bay and Port Alfred are now becoming the sites of primary residences, instead of being exclusively holiday destinations.

A major stimulant in the housing sector is government. In 2019 the Eastern Cape Provincial Government claimed to have built 500 000 houses in the term of office of the administration that started in 2014.

A new housing development in the rural area of Keiskammahoek attracted funding of R25-million from the Eastern Cape Provincial Department of Human Settlements. Aimed at destitute families, the first phase was conducted in the settlement of Masincedane, and the project will ultimately cater to 1 255 beneficiaries.

Large-scale housing projects often demand unique lighting requirements. The Buffalo City Metropolitan Municipality called in large-area lighting specialists Maritz Electrical for the lighting of its informal settlements. The introduction of LED lighting on 20 meter masts will provide a measure of security and maximise energy efficiency.

A remarkable transformation has taken place in downtown Port Elizabeth. The old “Sanlam” building, which used to house one of the country’s most notorious security branch torturers, has been converted into social housing. Together with two other buildings (Mumford House and the Old Mill Building) the area has been named the Steve Biko precinct in honour of the Black Consciousness leader and will offer a heritage aspect in the form of a museum. The room in which Biko was tortured has been preserved as a historical site.

The Qhama Social Housing Institute offers accommodation from R1 200 per month and is targeted at the “missing middle”, people who can’t afford a bond and who don’t qualify for an RDP house. These people are entitled to a housing subsidy.

Transformative development

One of the largest malls to be constructed in South Africa in the new century has made a big impact on the western edge of Port Elizabeth. With 250 shops, an ice rink and cinemas, the R2-billion Baywest Mall is the first part of what will become the 320 ha Baywest City Precinct on the N2. The giant development spurred a R300-million upgrade at Greenacres, the city’s first big mall development which attracted shoppers away from the central business district (CBD) in 1981.

The Mandela Bay Development Agency (MBDA) has transformed the Old Tramway building (left) at the entrance to the Baakens Valley. The MBDA not only moved into new offices in the renovated building but is letting it out as an events venue. Other retail property developments have happened in the valley (including a popular brewery), drawing attention to the potential of Port Elizabeth’s green lung to be even more useful in future.

The Baakens River Valley is one of Port Elizabeth’s hidden gems and the MBDA has commissioned studies on how the valley might best be utilised for leisure and new housing without compromising its unique natural features.

A scheme to restructure the yacht basin in the harbour is planned. A key blockage is the location of manganese storage dumps on the edge of King’s Beach. When those are moved to the Port of Ngqura, the marina development can go ahead.

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