INTERGRATED INFRASTRUCTURE PROGRAMME- Limpopo Coalfields Conference-18 October Fhatuwani Ramagwede

Transcription

1 INTERGRATED INFRASTRUCTURE PROGRAMME- Limpopo Coalfields Conference-18 October 2013 Fhatuwani Ramagwede 1

2 RAILWAY OVERVIEW OF THE CURRENT STATE OF MINING INFRASTRUCTURE Significant number of mineral products mined in areas distant from markets and export habours With some exceptions, these products are low value and high volume Rail transport normally the most economical transport mode Inherent inefficiencies of rail infrastructure combined with capacity constraints and high costs 87 % of 1.6 billion tons of freight estimated to have moved by road Rail making up 12.7% (CSIR, 2009) Waterberg coalfields contain significant share of SA remaining coal resources Currently one operating coal mine Rail infrastructure key to unlocking potential of this coalfield 2

3 OVERVIEW OF THE CURRENT STATE OF MINING INFRASTRUCTURE ROAD Number of producers still using road transport Due to inefficiencies of the rail system Deterioration in road infrastructure WATER Around 30% of all current coal transported to power stations by trucks 68% is conveyor 3 % is rail Water is critical input for the mining sector Water resources not evenly distributed across country In regions of scarce water resources New source of water is being sold locally by municipalities Problems associated with expansion and purification while ensuring that mines stick to core business 3

4 OVERVIEW OF THE CURRENT STATE OF MINING INFRASTRUCTURE ENERGY Availability of competitively priced and reliable supply important Mine production Processing Smelting Refining LQUID FUELS Diesel fuel is crucial for operations and for electricity generation Diesel fuel is major energy carrier in open cast mines Used in mechanised, trackless underground mines SOCIAL INFRASTRUCTURE Mining largely occurs in rural areas where there is paucity of social infrastructure Housing, schooling and health facilities are binding factors in the development of mining to its full potential Important factor in attracting highly skilled personnel such as engineers and artisans 4

5 SELECTED GOVERNMENT INFRASTRUCTURE PLANNING MECHANISMS THE NATIONAL TRANSPORT MASTER PLAN (NATMAP-2050): this planning mechanism is a physical development plan that will define a framework that the country s future state-of-the-art multimodal transportation systems planning, implementation, maintenance, operations, investments, and monitoring decisions are to be made. It will follow a five year planning cycle. TRANSNET S LONG TERM PLANNING FRAMEWORK (LTPF): this planning mechanism is what Transnet uses as a basis for funding infrastructure development projects for rail and pipelines. This mechanism is reviewed on an annual basis and has a planning horizon of 30 years. THE INTEGRATED RESOURCE PLAN (IRP-2010): This planning mechanism is a planning mechanism for the country s electricity generation mix and capacity. The current iteration of the IRP, IRP-2010, covers the period 2010 to The IRP-2010 will be reviewed every two years. INTEGRATED INFRASTRUCTURE PLAN (IIP): The IIP is a tool that will be used to interrogate the type of infrastructure for targeted and prioritised public sector investment. To improve alignment, co-ordination and investment decisions for economic infrastructure with a view to guide MTEF allocations by the Treasury. Coordinated and regular inputs by the mining industry through the ILTIPM will ensure the critical infrastructure required by mining industry to create the much needed jobs. THE INTERGRATED WATER RESOURCES PLAN: This plan is still under development and not yet approved. 5

6 Mining Industry Growth, Development and Employment Task Team (MIGDETT) The Mining Industry Growth, Development and Employment Task Team (MIGDETT) was established in 2008, with the industry stakeholders committing to achieve two critical outcomes: To help the industry manage the negative effects of the global economic crisis and to save jobs To position the industry for growth and transformation in the medium- to long term MIGDETT comprised representatives of government, organised labour and industry 6

7 The MIGDETT declaration adopted in June 2010 commits the stakeholders to sustainably grow and transform the industry establish a long-term infrastructure planning mechanism innovate technology balance economic growth with sustainability add value through beneficiation optimise regulatory frameworks develop skills advance employment equity boost near-mine communities improve mine housing develop enterprises through procurement realise 26% HDSA equity ownership by 2014 monitor and evaluate the implementation of the joint declaration 7

8 Infrastructure is one of the 13 commitments Commitment 2 Infrastructure Recognising that infrastructure is one of the key drivers of the competitiveness with a material impact on it s potential growth, and further recognising that shortages of critical infrastructure such as rail, ports, electricity and water supply can act as constraints to growth, the parties commit to the following: Establishment of an Integrated Long Term Infrastructure Planning Mechanism for the mining sector; Evaluation of short to long-term infrastructure requirements underpinning the envisaged growth of the mining industry through the process of engagement between industry and government; Identification of areas that are industry and/or government responsibilities, including shared responsibilities; Engagement with relevant national processes committed to long-term integrated planning process with specific emphasis on the mining industry s infrastructural needs. 8

9 INTEGRATED LONG TERM INFRASTRUCTURE PLANNING MECHANISM (MINTT) The objective of the Infrastructure Task Team (MINTT) is to: recommend mechanisms to optimise the role of infrastructure and infrastructure roll out in South Africa s mining districts in effect, to formulate an Infrastructure Roadmap for the SA mining sector. 9

10 Infrastructure Roadmap A roadmap is a strategic plan that describes the steps that we need to take to achieve the stated outcomes and goals It clearly outlines the tasks and priorities in the near, medium and long term It includes metrics and milestones to monitor implementation, i.e. allow tracking of progress towards the roadmap's ultimate goals Where are we now? Where do we want to be? How do we get there? 10

11 Study scope precise definition and consensus needed The study will include the following: All the mining districts in SA for major commodities especially bulk commodities Critical Infrastructure (water, energy, rail, port ) i.e. optimisation of those currently in existence, development of those currently planned and identification of infrastructure requirements for the future A->30-year time horizon The study will exclude the following: Municipal infrastructure especially for housing and other developments etc. 11

12 Membership representation needs to be inclusive but manageable 1. Business Chamber of Mines SAMDA Individual Mining Companies 2. Government Department of Mineral Resources Department of Water Affairs Department of Energy Department of Environmental Affairs Department of Agriculture Department of Transport Transnet CGS Eskom Economic Planning 12

13 Work breakdown structure Planning and preparation phase (completed) 1.1 Kick-off meeting >> agree terms of reference, sub-group structure and next actions 1.2 CGS captures outcomes 1.3 DMR draft document of Challenges and Opportunities for circulation 1.4 CGS convenes Expert Group meetings Circulation of DMR draft document of Mining Sector challenges and opportunities-completed. Sectoral Planning primary focus areas, specific and quantitative targets Infrastructure needs and priorities action proposals, research areas, structures, facilities, financing Action Plan 13

14 INCEPTION MEETING OF MINTT The first meeting (involving Government and semi-government organizations) was held at the CGS on 28 August The following Departments participated: DMR, DoE, DWA, DEA, DoA, CGS, Eskom, and Transnet. The purpose of the meeting was to plan the process of developing this Roadmap: Common understanding of what is required Consensus on terms of reference Agree levels of participation Agree preliminary, high-level schedule Agree immediate next steps Agreed that the roadmap should be aligned with the existing working initiatives. The next meeting will be presentations on existing government initiatives and identification of gaps and linkages 14

15 IMPORTANT CONCLUSIONS Successful implementation of the infrastructure programmewill depend on: Accurate indications of where exactly mining rights had been issued in every part of the country. Accurate indications of where future mining rights are expected to be issued in every area of the country. Integration of current government infrastructure planning mechanisms Participation of all relevant stakeholders 15

16 Relevance of MINTT Limpopo Coal Current mining activities: 1. GroottegelukMine (Waterberg Coalfield) 2. Tshikondeni Mine (Soutpansberg Coalfield, closing down) 3. Vele Mine (Tuli Coalfield) Feasibility stage project: 1. Makhado (Soutpansberg Coalfield) Waterberg 60% of country s resources Future coal mining province Conference 16

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18 Thank You 18