Illegal mining, also known as artisanal mining, is an ongoing challenge for South Africa’s mining industry. The issue has negative economic, social, and environmental impacts. It costs the sector and national fiscus billions of rands each year, poses significant health and safety risks to those who participate in it, contributes to an increase in crime and illegal trade, and can contaminate precious natural environments.

However, as technology and digital tools advance, there’s an opportunity to deploy these solutions in the fight against illegal mining. Edge computing has a significant role to play; with the right implementation, it can greatly enhance the effectiveness of anti-illegal mining efforts in the country.

South Africa regularly bears witness to the consequences of illegal mining. In July, it was reported that at least 17 people in a settlement in Gauteng had been killed after being poisoned in a gas leak, with the victims believed to be illegal miners. Though the cause of the recent ‘Joburg explosion’ that took place on Wednesday 19 July has yet to be confirmed, the event highlighted the threat of illegal mining to the city’s gas and pipeline infrastructure.

A breakthrough at the edge

Private industry players and public institutions have a responsibility to deploy the latest security innovations in combatting illegal mining. Edge computing represents an opportunity to achieve maximum insight from video surveillance without having to rely on 24/7 human surveillance or excessive protection measures for assets that are no longer valuable, such as sealed mines. Edge analytics also allows for faster response times in the event of an incident, saving lives and positively contributing to a very important sector.

Edge computing is a decentralised computing paradigm that brings data processing and computation closer to the source of data generation, typically at or near the edge of the network. In traditional cloud computing models, data is sent to centralised data centres for processing and analysis. Edge computing shifts this processing to local devices or edge servers, reducing the latency and bandwidth requirements associated with transmitting large amounts of data to the cloud. By processing data locally, edge computing enhances the efficiency and performance of various applications. This is particularly useful in scenarios where real-time data analysis and quick decision-making are crucial, such as in mining operations.

Real-time data for ready responses

Because edge computing enables the processing of data closer to the source of collection, it could be extremely valuable for combatting illegal mining. By deploying edge devices, such as sensors and cameras, directly at mining sites or vulnerable areas, real-time data can be gathered and analysed on-site. This instantaneous processing of data allows for immediate detection of unauthorised mining activities, preventing further damage and illegal extraction. Edge computing enables the processing of geospatial data collected from satellites and drones. This data can be used to create detailed maps of mining areas, track changes in land use, and identify areas prone to illegal mining activities. The timely analysis of this geospatial data assists law enforcement agencies in planning targeted interventions.

Remote, but still reacting

Illegal mining often occurs in remote or hard-to-reach areas, making traditional surveillance and monitoring challenging. Edge computing solutions enable the deployment of advanced surveillance systems that can monitor remote locations effectively. Real-time video analytics can identify suspicious activities and trigger immediate alerts to security personnel or relevant authorities. With the integration of Internet of Things (IoT) devices, edge computing facilitates seamless communication and coordination between various sensors and devices. Connected IoT-enabled devices such as seismic sensors, environmental monitors, and geolocation trackers enable authorities to gain valuable insights into potential illegal mining activities, including ground disturbances, unauthorised equipment usage, and irregular movement patterns.

In remote areas with limited or unreliable internet connectivity, edge computing solutions can function in offline mode. This means that the data collected at mining sites can be processed and analysed locally without dependence on continuous internet access – critical with South Africa’s current power crisis. Once a connection is available, the relevant data can be transmitted to central databases for further analysis and reporting.

Each illegal mining operation poses its own challenges. And, while it’s difficult to suggest a single solution, the advantage of edge computing in combatting illegal mining cannot be ignored. Its ability to process real-time data, facilitate enhanced surveillance, and integrate IoT devices enables more effective monitoring, detection, and prevention of these activities. By leveraging edge computing solutions, authorities and mining companies can improve their response capabilities, mitigate environmental impacts, and protect valuable mineral resources from exploitation by unauthorised individuals or groups. Edge analytics in network surveillance should be seen as a component of a holistic security strategy. Therefore, it’s important to work with expert product vendors to establish a scalable, edge-enabled ecosystem for long-term growth and increased efficiency.

Anglo American CEO Duncan Wanblad said on Thursday mining companies have to confront tough decisions such as cutting costs as weak metal prices hit earnings, a day after the group announced plans to shed an undisclosed number of jobs.

The industry, including South Africa, where Anglo owns iron ore, platinum and diamond mines, is going through “challenging times”, Wanblad said in a virtual address to a South African mining conference.

Anglo said on Wednesday it is cutting some head office jobs across its global operations.

“We know that securing long-term competitive advantage and establishing a more resilient platform involves tough choices along the way,” Wanblad said.

Weaker metals prices and concerns of a global economic slowdown this year are compounding an electricity and freight rail logistics crisis in South Africa, the continent’s most advanced economy and a leading global mining jurisdiction.

On Wednesday, Sibanye Stillwater CEO Neal Froneman said job cuts in the platinum sector had become “inevitable” as prices of the precious metals fall.

Sibanye, South Africa’s biggest mining sector employer, may be forced to close some loss-making shafts, Froneman said.

Loadshedding has had a significant impact on the South African mining sector. The PwC report ‘SA Mine 2022’ painted a picture of intense economic and structural complexity which was offset by a remarkable overall performance by the sector despite the challenges. More hours in the dark than with power has meant that the sector has had to put extreme alternative power measures in place but, as the problem with loadshedding intensifies, so does its impact. Statistics South Africa found that mining output has decreased by 2.6% in March 2023 as compared with 2022 and the consistent decline in overall infrastructure stability – across both the electrical grid and other factors such as Transnet – has seen the sector lose R150 billion in export value over the past year.

The sector is boldly navigating these challenges with ingenuity and investment, but the fact remains that the continued loadshedding is eating away at the edges of profitability and the overall economy. Where other countries are slowly regaining their footing after the pandemic – an event that shook up the very foundations of the global economy and business – South Africa’s economy and industries continue to be impacted by loadshedding and the limitations it imposes.

In 2023, there has been only one day of suspended loadshedding a total of 247 days by the beginning of September. This is compared with 205 days in total in 2022. The stages have also increased significantly from most stages sitting at two or three in 2022 while the majority are four and above in 2023. This triggered the State of Disaster announced by the President at the start of the year, a statement that has been repealed due to legal reasons but that does starkly highlight the dire situation for the country and the economy.

This adds immense pressure to a sector that’s facing complexity across compliance, regulation, ESG mandates and global competition. It is also a sector that employs roughly half a million people – a critical consideration for a country already struggling with high levels of unemployment. The South African gold mining sector is particularly at risk of losing jobs thanks to loadshedding. A recent analysis in the Mail & Guardian found that job losses and early closures are likely if loadshedding remains at high levels this year.

In March 2023, Fitch published a review of the impact of loadshedding across multiple sectors and revised its assessment of mineral production growth forecasts from 0% to -1% year-on-year for iron ore, and from 2% to -2% for platinum. The mining industry dominates the headlines as it is a leading consumer of power, a leading taxpayer, and a significant provider of employment, contributing a major percentage to the country’s GDP and South Africa’s position as the fifth-largest mining economy in the world. It needs to dominate the headlines differently for the remainder of 2023 and into 2024 as it seeks out alternative and bespoke power and transport solutions that will overcome reliance on ageing government-owned infrastructure.

To overcome this challenging landscape, there needs to be key shifts across energy, regulations and government interventions as well as ongoing investment from the sector into solutions that allow for it to bypass reliance on the grid. One of the key requirements now is for regulation that encourages private investment into renewables alongside improved procurement of additional capacity in the public sector. While some steps have been taken here, progress is slow.

Aggreko has seen increased interest in bespoke power solutions that will allow mining companies to better manage their control over power while also addressing challenges around ESG obligations on a local and global scale. The situation is pushing larger power consumers to accelerate their investments into renewable energy solutions that align with ESG objectives and will supercharge their ability to deliver on performance despite the energy crisis. Private investment into energy solutions is having one of the greatest impacts on the current loadshedding situation and will continue to do so over the next few years as the grid endeavours to stabilise. Aggreko can provide on and off-grid solutions designed to provide cleaner mining energy that is flexible, hybrid, optimised and capable. It is also highly customisable to suit the changing needs and expectations of the sector throughout loadshedding and can help mitigate the economic cost of the grid’s instability over both the long and the short term.

The Bank of Tanzania (BoT) has started a large gold-buying initiative as part of a strategic drive to support the expansion of the mining industry and strengthen foreign exchange reserves.

The information was made public by Emmanuel Tutuba, the Governor of the Bank of Tanzania (BoT), during his visit to the Geita Gold Refinery and the Mwanza Precious Metals Refinery Co Ltd.

Under the initiative, BoT has already acquired and refined 418 kilogrammes of gold.

“As highlighted in the budget by the Minister for Finance Dr Mwigulu Nchemba, the government has allocated funds for the purchase of gold. This year, our target is to procure six tonnes of gold, both from small-scale, middle-scale, and large-scale miners,” he said.

He also said BoT purchases gold to diversify the country’s foreign exchange reserve and reduce reliance on a single currency.

This diversification intends to safeguard Tanzania’s wealth against currency devaluation or economic stability caused by global shocks.

“Now for the first time, we have both a gold and dollar reserve. Previously, we only had the US dollar as a foreign exchange reserve,” he added.

During recent months, Tanzania just like other economies, has been adversely affected by a decision by America’s Federal Reserve to embark on aggressive rate hikes as a measure to fight domestic inflation in the US economy.

This has seen various central banks around the world embark on measures that have resulted in a reduction in the amount of dollars in circulation and a steep depreciation of their domestic currencies, resulting in a rise in the prices of imported goods and products, including petroleum.

In Tanzania for instance, the amount in foreign exchange has been going down as the import bill rises.

BoT says in its Monthly Economic Review for August that foreign exchange reserves remained adequate, mainly driven by external loans and grants received by the government, saying however that foreign exchange inflows from exports were fully absorbed by the rising import bill.

BoT says the reserves amounted to US$5.247 billion (Tsh13.1 trillion) at the end of July 2023, slightly below the level reached at the end of July 2022, on account of sales in the interbank foreign exchange market to support the importation of goods and services.

The reserves were sufficient to cover about 4.7 months of projected imports which the BoT says were consistent with the country and EAC benchmarks of at least 4 and 4.5 months, respectively.

And in a broader effort to oversee mineral exports and boost the sector’s contribution to the country’s GDP, the government has recently increased its engagement in the mining sector, including strengthening regulations, establishing a national gold reserve, and setting up mineral shops in more than 22 regions across the country.

Furthermore, Tutuba outlined BoT’s commitment to boosting exports and enhancing the quality of domestically manufactured goods intended for international markets through the Export Credit Guarantee Scheme.

“We are actively engaged in discussions to explore avenues for assisting small-scale miners, enabling them to secure funds, engage in mining operations, and vend their gold to refining facilities. Ultimately, this gold will find its way into the Central Bank’s coffers,” he said.

Tutuba also urged major gold traders to comply with foreign exchange regulations mandating the repatriation of foreign exchange earnings from gold sales back into the country within 90 days.

This compliance would be instrumental in supporting the nation’s economic growth.

Tanzania is home to several large-scale gold miners, including Geita Gold, Bulyanhulu, North Mara, and Buzwagi.

The country also hosts millions of artisans and small-scale miners across the country.

For his part, the Chief Executive Officer of the State Mining Corporation (Stamico) Venance Mwase expressed gratitude to the government for facilitating the establishment of gold refining facilities within Tanzania.

He also emphasised that these facilities would empower the Central Bank to procure and stockpile gold, thus bolstering foreign exchange reserves and fortifying the national economy.

“Stamico will collaborate closely with BoT to ensure that small-scale miners gain access to loan guarantees, enabling them to increase gold production and deliver it to our gold refining facility in Mwanza. This initiative will significantly augment the Central Bank’s gold reserves,” he stated.

The establishment of the National Gold Reserve was announced by Nchemba during the 2023–24 budget presentation, an initiative by former president, the late John Magufuli.

This decisive step was to address issues in the mining sector and ensure Tanzanians benefit more from its vast natural resources.

Tanzania’s determination to regulate the mining sector arose from allegations of fraud, smuggling, and underreporting of production and profits.

Statistics showed inconsistencies in gold exports and production.

In addition to these developments, BoT’s active participation in the Sixth Mining Technology Exhibition, scheduled from September 20 to September 30, 2023, at Bombambili grounds in Geita, marks a valuable opportunity to strengthen collaboration between the Central Bank and the mining sector in the country.

Balancing environmental sustainability with economic and social demands is always challenging, and South Africa is grappling with an ever more complex regulatory framework as it tries to walk this line.

The country has a well established legal foundation for assessing and managing environmental impacts, and this is regularly updated, extended and modified. Among recent changes to environmental regulations are those aimed at allowing renewable energy developments to be fast tracked, as well as a focus on the implementation of biodiversity offsets.

SRK Consulting partner and principal consultant Chris Dalgliesh highlighted that environmental impact assessment (EIA) processes are differently affected particularly if the proposed project is in a renewable energy development zone (REDZ) or a strategic transmission corridor – areas earmarked for the development of infrastructure of this nature.

Streamlining renewables

“If the project falls into either of these areas, there are different requirements for the EIA, meant to assist in streamlining the process for quicker implementation,” said Dalgliesh. “The processes also differ depending on whether you are dealing with the energy generation component of the project, or the grid component – which often have to be assessed as separate EIA applications.”

Therefore, when considering projects for which environmental authorisation is sought through an EIA process, developers are confronted with multiple permutations of application processes, choosing those which best suit their development plans. The competent authority may also have their own interpretation of what the EIA applications must include, he explained.

Changing regulations

“Even five years ago, the EIA options were comparatively straightforward,” concurred Sharon Jones, partner and principal environmental scientist at SRK Consulting. “Our more complex projects would require a scoping and EIA – or a ‘full’ EIA – while other projects required only the basic assessment process.”

These two processes still apply, but environmental assessment practitioners (EAPs) now need to consider a host of other variables as the rules are continually updated. An indicator of the pace of change, Jones noted, is the high number of relevant new regulations, protocols and guidelines associated with EIA processes published in the Government Gazette each month.

Less flexibility

A recent instance has been a court decision which will oblige renewable energy developers to conduct a single EIA process for a generating facility and its associated grid infrastructure – rather than splitting that into two applications for greater flexibility. According to Kelly Armstrong, environmental consultant at SRK Consulting, this illustrates the importance of EAPs keeping track and abreast of what legal precedents are being set, as well as the regulatory updates and competent authorities’ interpretation of the rapidly changing legislative landscape.

Jones added that, in their efforts to streamline new power generation capacity, renewable energy developers have tried to cluster their EIA applications to facilitate the authorisation process. For example, they propose clusters of renewable energy developments, each with a separate EIA process but a single combined stakeholder engagement process at the time – leading to EAPs attempting to manage up to 20 EIA processes concurrently. These activities can, however, quickly become disjointed or misaligned as requirements change.

Timeframes

“Consultants and EAPs must navigate this legal terrain very carefully, to keep abreast of what is required,” she said. “The implications on project timelines can be significant, as many aspects of EIAs are time-consuming; a wind farm application relies on a bird and bat monitoring period of two years prior to the EIA being completed.”

The cumulative momentum of all the changes to environmental regulations, warned Dalgliesh, had led to a situation where it is now more difficult to achieve EIA compliance in South Africa than it isto comply with international standards.

“Our processes have become much more complex, and we need to consider substantial allied legislation,” he said. “While our legal evolution is well-intended, there is a danger that EAPs have to spend so much time learning the new EIA rules that they are being distracted from actually doing EIAs in an efficient manner.

Biodiversity offsets

Jones pointed out that another recent change relates to the country’s first National Biodiversity Offset Guidelines – which will also have to be considered in EIA applications. After many years in the pipeline, these guidelines were published in June for implementation, and apply to both terrestrial and freshwater realms.

Armstrong said the guidelines will be applicable across sectors and, now that they are gazetted, will provide much clearer direction on how biodiversity offsets should be integrated into EIA processes.

“In addition to their existing compliance requirements, clients will be looking for guidance on what these biodiversity offsets mean for current or future development applications,” she said. “They will be relevant, for instance, if any project is located in areas where there are species of conservation concern and/or protected areas.”

She noted that SRK’s experienced consultants understand the implications of ever changing legislation for clients, and provide valuable assistance in managing the complexity of the process.

Menar MD Vuslat Bayoglu raised concerns about SA’s ability to afford an overhaul of the power system to suit renewables, at a time when the GDP growth rate has dropped to 0.4%. Bayoglu spoke during a panel discussion at the Coal and Energy Transition Day conference in Johannesburg on Tuesday, 18 July.

Amongst available baseload suppliers, hydrogen is rated at as the most expensive at an estimated cost of US$239 per MWh, followed by nuclear power at US$225 per MWh, while coal is about US$74 per MWh, gas is about US$94 per MWh. “Renewable energy is the most expensive resource,” he said.

South Africa’s priority should be closing the gap between rich and poor and providing jobs. “Coal is the country’s third biggest employer in the mining sector with more than 90 000 employment opportunities already created. We have the potential to create more jobs through coal,” said Bayoglu. “Solar panels are produced in China, and we do not produce wind turbines in South Africa. But when a coal mine is opened, we can employ between 400-800 people.”

The Just Energy Transition plan states that R648 billion would be needed for the 2023-2027 period to integrate green energy resources and reduce coal usage. Bayoglu noted that it was not clear where the funds would come from.

“Despite the challenges coal’s resilient nature will see it evolve and maintain its position as a significant contributor to the world’s energy mix. Eskom needs to invest in clean coal technology through retrofitting or building power stations with carbon capture functionality to support reliable energy supply,” he adds.

Bayoglu emphasised that the government needs to enhance private sector involvement, cut the red tape, and take decisive action in resolving the Transnet challenges.