Investment in mining logistics infrastructure urged, Japan quake crisis may hit Australian iron expansion, Pan African breaks ground at platinum project

By: Martin Creamer

Published on 1st April 2011

International logistics company Bridge group says the African mining industry will have to invest in new and replacement infrastructure to meet growing demand. Read on page 12 of this edition of Mining Weekly of the 20-year commodity super cycle putting infrastructure under pressure. Bridge says that by 2015/2016, there will be an additional 327-million tons of cargo generated in areas such as central Mozambique, northern Zambia, the Democratic Republic of Congo, Malawi and Zimbabwe, whereas infrastructure spend will cater for only 122-million tons. That leaves a shortfall of 205-million tons of demand without the necessary capacity.

The Japan earthquake aftermath could slow supplies for iron-ore expansion. Diversified miner Rio Tinto says its Pilbara iron-ore infrastructure expansion plans may be affected. Read on page 18 of this edition of Mining Weekly that severe weather may also take its toll in timeous equipment supply needed. Rio Tinto reports that, while a number of our suppliers have been impacted, the indications are that on the expansion plans, and not current operations will be slowed. Rio plans to expand its Pilbara iron-ore production to 333-million tons a year by the end of 2015. The largest single component of the expansion project is the construction of the second terminal at Cape Lambert, where export capacity will be increased by 103-million tons. Rio has set aside some $15-billion for its Pilbara expansion, which does not include the reinvestment in the current operations.

Junior miner Pan African Resources - until now only a gold producer – has broken ground at its Phoenix platinum project, beginning its foray into the platinum market. Read on page 17 of this edition of Mining Weekly of the construction of the chrome tailings retreatment plant (CTRP) from which the platinum will be recovered, being on schedule and the procurement of major equipment completed. Plant construction is scheduled to start in mid-May 2011 with plant commissioning planned for October 2011. The CTRP full production rate of 20 000 t/m is expected to be achieved in the first quarter of 2012. The company expects to recover platinum at a cost of $370/oz and is leaving a $30/oz reserve for contingencies; based on a basket platinum price of $1 600/oz, the project is expected to show a profit of $1 100/oz. Pan African is looking to doubling the Phoenix resource to one-million tons. It is also studying hard rock platinum opportunities.

To watch a video in which Pan African Resources CEO Jan Nelson speaks about the company’s platinum ambitions, go to www.miningweekly.com and click on ‘Multimedia’ and then on ‘Video Clips’, or watch it on the Mining Weekly App on your iPhone.

Editor: Martin Creamer