Partnering - essential to African mining Wednesday, February 08,...

Partnering - essential to African mining


Wednesday, February 08, 2006

IF LAST year was South Africa's year of commitment, 2006 marks the mining community's willingness to deliver on obligations to regional communities throughout the continent. By Mark Story in Cape Town



According to William Zisch Newmont's vice president in charge of African operations, what's driving the region's sustained prosperity is the role the mining community now plays in black economic empowerment (BEE).

In 2005 procurement alone to BEE exceeded 5.46 billion rand.

The soft issues, Zisch advised the 2000-plus delegates on day one of Mining Indaba 2006 - Africa's most important mining event - are no longer optional.

"Partnering is now an essential part of modern mining business," Zisch said.

He cited the company's recent involvement at its Ahafo site in Ghana as an example of new efforts Newmont is making to resolve challenges in mine development.

By establishing a resettlement and compensation committee the company has managed to successfully relocate 9000 people out of a mine-affected area.

To Brian Mennell executive chairman of TSX-listed Energem Resources Inc, the global mining community's renewed commitment to sustainable development within the Africa recognises the exciting opportunities now available within the region.

Mennell claimed that ongoing efforts to develop South Africa's infrastructure make it an especially good time to embrace the Africa's single largest economy.

A notable improvement within South Africa's financial market, added Paul Miller corporate financial executive with Nedbank, means South Africa is well and truly open for business.

"There's no better signal of the market's financial improvement than five consecutive years on the JC without a single failed trade."

Increased exposure to Africa (notably Guinea and South Africa) has also helped fellow TSX-listed Crew Gold Corp move from aggressive junior company to mid-tier resource stock (with a market cap in excess of $A750 million).

With 80% of the company's time and 90% of its funding in gold, the company's CEO Jan Vestrum expects Crew to be a major mid-tier producer from 2007.

Meantime, operational efficiencies within its 16 assets in Africa saw Anglo Gold deliver R302 million in saving in 2005.

Chief operating officer Nevill Nicolau expects the recent restructuring of the company's assets in the region to ensure technical skills match the broader aims – including profit margin protection and optimization of existing ore bodies.