Chamber of Mines. Newsletter. A quarterly newsletter for the Namibian mining industry Issue 02/2014 May Issue 02/ Chamber of Mines News

Transcription

1 Chamber of Mines Newsletter A quarterly newsletter for the Namibian mining industry Issue 02/2014 May 2014 Issue 02/2014 1

2 2 Issue 02/2014

3 Contents In this issue Uranium prices decline further The uranium industry last year increased production volumes to reduce unit costs as a strategy to counter falling prices Value chains not a turn off INTERNATIONAL reports suggest that value addition in developing nations has become a risky gamble to take. Despite that, Namibia will maintain its stance that value addition is a core position for investment in the raw material sector, says Minister of Trade and Industry Calle Schlettwein Mining activities kick off at Husab Project SWAKOP Uranium detonated the first blast on its Husab Project site on 12 March 2014, thereby heralding the start of mining activities on what will become the world s second largest uranium mine B2Gold Leaving a Legacy B2Gold Namibia considers responsible corporate citizenship a key component to maintaining a strong reputation within the communities within which it operates. letter PO Box Schutzen Street Windhoek, Namibia Tel: Fax: dmeyer@chamberofmines.org.na President: Mr. Werner Duvenhage Vice-president: Mr. K. Kapwanga Second Vice-President: Mr. S. Kumar CEO: Mr. Veston Malango HR Administrator: Ms. Signa Ndombo Accountant: Ms. Hilma Nampala PA to CEO: Ms. Doreen Meyer Economist: Ms. Lauren Davidson The Chamber of Mines of Namibia MINING INDUSTRY ON THE GROWTH PATH TO SUPPORT THE NAMIBIAN ECONOMY Issue 02/2014 3

4 Message from the CEO It is time for the esteemed event; the Chamber of Mines is hosting the fourth Mining Conference on 22 May 2014 at the Safari Hotel & Conference Centre. The 2013 Conference attracted over 400 registered visitors. We expect this figure to increase significantly this year, as a result of new developments in the mining sector and stakeholders desire to learn about the mining industry at large. The Mining Conference aims to provide valuable information concerning current developments in Namibia s mining industry to all stakeholders. Overall, the event generally aims to grant the public a better understanding of the mining industry in the face of misconceptions about the sector s contribution to economic development in Namibia. In lieu of the above mentioned, I am pleased to announce that the theme for the Mining Conference is Mining Industry on the Path to Support the Namibian Economy, particularly highlighted by the development of three new mines and other mining expansion projects. As per Chamber tradition, the Mining Conference is entirely free of charge and I welcome you all to attend and participate in this prestigious event. Veston Malango Chief Executive Officer 15 May, 2014 Relocation of AREVA Namibia s office in Swakopmund AREVA Namibia has relocated their office in Swakopmund to the DF Malherbe Building, 1 st Floor, 25 Mandume Ya Ndemufayo Street, Swakopmund. 4 Issue 02/2014 All contact numbers remain the same. forward looking energy

5 Working for Namibia - Rössing Uranium's value addition At Rössing, we believe that our business can provide a strong base for economic growth in the communities around us, in the Erongo Region and in Namibia as a whole. Our economic contribution comprises the value we add by paying wages, employee benefits and Government taxes and royalties, as well as by making dividend and interest payments and by retaining capital to invest in the growth of the mine. In addition, we make significant payments to our suppliers of goods and services, both locally and nationally. The graphs shown here highlight some of the key socio-economic contributions Rössing has made to Namibia over the past five years, ie from 2009 to " Our work on transforming the business continues to deliver a rich stream of ideas that are being implemented with urgency and passion. This is vital because we need to position ourselves to benefit from growth in the uranium market, as uranium will remain an important part of the global energy mix. " Werner Duvenhage, managing director, Rössing Distribution of Rössing's procurement spend, 2013 International suppliers, 19% South African suppliers, 17% Millions (N$) Namibian suppliers, 64% Erongo Region, 34% Swakopmund, 76% Contribution to Government revenue Year Millions (N$) Millions (N$) 3,000 2,500 2,000 1,500 1, Payment to suppliers Year Payment to all suppliers Payment to Namibian suppliers After-tax payments to employees Year Corporate tax Royalty tax Dividends to Government PAYE After-tax payments to employees Millions (N$) Contribution to skills development Year Millions (N$) Contribution to neigbouring communities Year Spending on skills development Rössing's direct community contributions As % of total salaries and wages Rössing Foundation spend Rössing Uranium Working for Namibia Issue 02/2014 5

6 Uranium prices decline further Christine-Rita Abankwah The uranium industry last year increased production volumes to reduce unit costs as a strategy to counter falling prices. However, Chamber of Mines President and Rössing Uranium MD Werner Duvenhage cautioned that this could not serve as a solution indefinitely because there were limits to the amounts by which the industry could cut costs, and the incremental benefit would reduce. There would also be a point where the higher volumes put on the market would cause a cycle of further reducing the actual per unit revenue. Therefore, continued global production increase, while demand remains flat, would inevitably result in increased pressure on sales prices. It is extremely difficult for anyone to determine exactly where these turning points would be and [that] would remain a matter of opinion, he said. Despite a decline in international prices, Namibian receipts from uranium exports increased significantly in The Bank of Namibia attributed this to higher export volumes and the impact of the weakened R/N$ exchange rate. Uranium export volumes in Namibia increased by 9.9 percent in 2013 from 5,327 tonnes exported in 2012 while uranium export earnings stood at N$5.1 billion compared to N$4.6 billion in This was despite the average international price for uranium declining by 20.4 percent to US$38.9 per pound in Uranium spot prices currently hover at around US$29 per pound, which experts say is unsustainable as it is below the marginal cost of production. As a result, producers worldwide are experiencing losses. Nevertheless, some analysts remain optimistic, forecasting the uranium spot price will reach an average of US$50 per pound in Last year s lower international prices reflected the depressed global demand combined with delays in restarting Japan s nuclear reactors after the 2011 s Fukushima nuclear disaster, BoN said. Duvenhage believed that prices would remain depressed in the short to medium term, making new projects very hard to justify, and consequently impacting on growth in the portion of the market truly exposed to market conditions. This may not be the case for projects where the same owners of the mine also use the product in their nuclear reactors, he said. While he concurred that the weakened currency had improved the uranium industry s competitiveness against developed world production countries, it did not have the same effect against production from other developing countries whose currencies have also weakened against the US dollar. However, the depressed prices have had more of a negative impact on the industry than the benefit from the exchange rate, he said, and added that the currency was not the determining factor for sales and that it had no impact on sales volumes. Rather, other elements, such as grade, recoveries and market appetite for product determine whether increases in sales and production volumes will occur, Duvenhage said. crita@observer.com.na 6 Issue 02/2014

7 Representatives of a community based organisation with Debmarine Chief Executive Officer Otto Shikongo (middle) and Debmarine Communications Manager, Stella Auala (first from left) after handing over the donation. Debmarine funds community projects Francis Xoagub On 7 April 2014 Debmarine donated N$160,000 to different social upliftment community projects as part of its commitment to charitable causes. Speaking at a handover ceremony of a symbolic cheque to representatives of three community-based organisations, Debmarine Chief Executive Officer Otto Shikongo said it was incumbent on the company to contribute to social upliftment programmes. Debmarine has a social responsibility fund in place which seeks opportunities to support charitable causes that make a difference to the social well-being in the communities. We certainly work hard to unlock the sparkle for Namibia, Shikongo said. Mainstream Foundation (N$60 000), DAPP Namibia (N$80 000), Oonte OVC Organisation (N$24 000) and Friendly Haven (N$51 000) will share the donation. Debmarine Chief Executive Officer Otto Shikongo Shikongo also announced that the company had worked with an impoverished rural community in southern Namibia to explore the possibilities of a small-scale agricultural project. He, however, was not at liberty to disclose information about the towns where they would establish the project because planning was still at an early stage. Debmarine Communications Manager, Stella Auala said this showed the company cared about the communities in the areas where it operated. It is certainly true that if you give a man a fish he is hungry again in an hour; if you teach him to catch a fish you do him a good turn, Auala said. As one of the leading corporate citizens in Namibia, Debmarine s business objectives are to have a close rapport with the community and to give strong support for worthy community initiatives. We believe in the approach of creating and supporting sustainable communities, she added. She promised that the company would visit each project to follow up on donations and inspect the various projects. francis@observer.com.na Issue 02/2014 7

8 Value chains not a turn off Christine-Rita Abankwah INTERNATIONAL reports suggest that value addition in developing nations has become a risky gamble to take. Despite that, Namibia will maintain its stance that value addition is a core position for investment in the raw material sector, says Minister of Trade and Industry Calle Schlettwein. That is the principle that we have agreed on and we will stick to it without any doubt. It is a necessity to grow our economy. We cannot perpetuate a situation where we are settled at the bottom of the value chain as the provider of raw materials and the importer of finished goods. That era has gone and we have to take the steps to industrialise, he said in a recent interview. Reuters recently reported that the efforts of African governments to force mining companies to process minerals before they export them might backfire as they come up against weakening commodity prices and investor demands that firms reduce risky investments. In the last year alone, Zimbabwe, Zambia, Democratic Republic of Congo (DRC), Namibia, South Africa and others have hinted at, announced or put in place measures aimed at adding value to mineral exports, which would boost tax revenue, encourage formation of new businesses and add jobs. But with falling metal prices and a drastic reduction in the capital available for the mining industry, wary companies are increasingly shying away from investment in countries where the rules of the game can change quickly, the report said. However, the Trade and Industry Minister begged to differ. I can understand that it would be a turn off for some, but surely not for all, because we still have a lot of interest in the manufacturing sector and investments in that sector are coming in, Schlettwein said. Ohorongo Cement is one good example of where a raw material that is mined is processed into a finished good, cement. The investors that tell us that they are turned off by the requirements of the value chain development or manufacturing, I take it are the investors that are purely interested in the extractive industries, pure mining. From their perspective, it is an unnecessary or unwanted burden because they do mining and they trade in raw materials. But that does not satisfy our interests; if we continue to export raw materials only, we forfeit the economic opportunity that value addition brings. The top five mining companies have slashed total capital spending from a peak of about US$70 billion in 2012 to an expected US$46 billion in 2015, the report said. Investment sentiment in the last year has moved against the mining sector, but the governments tend to have a lagging view of how this is going to affect investment in their countries. They continue to argue that mining needs to make a bigger contribution to their economies, but you ll have to see investment severely tail off to make them think they need to attract investment rather that scare it away, the report quoted Mike Elliott, global mining and metals leader at Ernst & Young, as saying. Kevin Goodrem, vice president of beneficiation for De Beers Group, said companies needed to decide whether they wished to continue mining in these countries and face what the governments wanted to do in terms of beneficiation, or pull out. In some cases, he said, it would be a pull out strategy. However, Chamber of Mines CEO Veston Malango said one should approach such reports with caution, as misunderstandings sometimes arose as to what both mining companies and governments were talking about. If you are talking of value addition in terms of mining companies producing final products such as cell phones, cars or jewellery, then that does not attract investment, because they do not have the technology and skills to do so, and that is not their line of business. Namibia needs to attract manufacturing investors that will advance the much-needed industrialisation based on pure minerals and metals that we currently produce. It boils down to the type of value addition the country is asking for, he said. He noted that whilst there was room for value addition in the mining industry, another challenge for companies was that there were no economies of scale to result in further beneficiation. For instance, Weatherly Mining produces about 25,000 metric tonnes of copper concentrates from Otjihase and Matchless 8 Issue 02/2014

9 mines which it exports to China. Weatherly Mining exports concentrates although it is within our technological knowhow to produce refined copper but this has not happened due to lack of economies of scale. The new Tschudi copper mine in Tsumeb will produce refined copper (99.99 percent) for the first time in the history of Namibia because it s an oxide ore body as opposed to the conventional sulphide ore bodies found in Namibia. From that pure copper, the manufacturing industry can produce final products such as copper wires and tubes, he said. He added that, expecting mining companies to put up refineries and smelters, for instance, would be an investment decision that would be purely based on economics. The same applies to zinc concentrate at Rosh Pinah Zinc Corporation. If they have to invest in a smelter then they need to have several times the production levels they have currently. That is what would justify such an investment decision, he said. Schlettwein said Namibia was in a position where it needed Foreign Direct Investment (FDI), and the country had a conducive climate for attracting that investment. We are also in a position where we export capital. We are sending our own savings out of the Namibian economy into other economies, so we also have an opportunity to utilise our own capital and channel that into industrialisation and development of value chains within our economy. I am still convinced that there is significant FDI potential in manufacturing and value adding activities in the economy of Namibia. So I don t think that it is completely true that we will lose all the FDI if we attach a condition of value addition to it, the minister said. A limited number of investors would probably not see that as a factor but there are very significant opportunities in value addition through developing regional value chains and participating in global value chains, he said. Furthermore, there were tremendous opportunities that came with penetrating large markets with semi-processed to finished goods, across various sectors, he added. Minister of Trade and Industry Calle Schlettwein. BURMEISTER & PARTNERS (PTY) LTD CONSULTING ENGINEERS CONTACT US HEAD OFFICE: 8 Eugene Marais Street PO Box 1496, Windhoek, Namibia Tel: Fax: bp@burmeister.com.na COASTAL OFFICE, SWAKOPMUND NORTHERN OFFICE, OSHAKATI S U STAINING T HE FUTU RE THRO UG Skilled Professionals In-house Capacity Building Con nuous Skills Transfer Annual Ter ary Educa on Bursaries Quality Service H NAMCOR Fuel Depot: Design & EPC Contract Navachab Gold Mine Sludge Thickener Civil & Structural Services Aussmelt Project at Tsumeb Smelter: Piping li es Walvis Container Terminal EPC Contract Rand Refinery: Cooling Water System and Electrical Infrastructure Issue 02/2014 9

10 Debmarine banks on new technology Francis Xoagub DEBMARINE Namibia (DBMN) achieved a record production of 1.16 million carats in 2013, partly due to the introduction of state-of-the-art technology and an exceptionally diligent and passionate team of employees, the company said. DBMN recently hosted the media giving journalists a rare opportunity to see the operations of the company. The company, which operates in Namibia s Atlantic coastal waters, is a 50/50 joint venture between the Namibian government and De Beers. It is the world s leader in sea diamond mining. This is a milestone production in our history, CEO Otto Shikongo said during a presentation after the media tour. Our exceptional production performance year on year is due to the high calibre of the workforce, highly skilled, technical and committed men and women, he said. Namibia is one of the world s largest producers of gem quality diamonds, with about 98 percent of diamonds produced being gem quality, according to Shikongo. Production increased Mining at water depths of metres, the company achieved record production of 1.16 million carats in 2013 compared to 1.10 million carats in 2012 while turnover was around N$5 billion. Debmarine contributed N$2.6 billion to Government coffers in the form of taxes, royalties and dividends in We are unrivalled in our contribution to the Namibian Treasury. This is an aspect of immense pride for all of us at Debmarine Namibia, Otto said. The company has made significant strides in its Namibianisation drive with locals constituting 80 percent of the workforce as at March 2014 compared to 15 percent when the company migrated from South Africa in The company has around 780 employees of which 627 (80 percent) are Namibians and 152 (20 percent) are non-namibians. Debmarine s social responsibility investments during 2013 amounted to over N$1.6 million. The diamond miner sponsors on average 24 Namibians annually to study specialised courses such as chemical engineering, geology, environmental science, mechanical and electrical engineering at various institutions of higher learning. Debmarine Operations Manager, Jan Nel, said marine diamond recovery has now surpassed traditional land-based diamond production after operations started in We believe with the right technology we can mine up to 2050, he said. The marine diamond industry has barely scratched the surface as far as the exploitation of the Namibian marine diamond resources. Nel said that mid-water to deep-water mining operations required sophisticated marine vessels and crawlers that were capable of retrieving diamondiferous gravels/ sands from the seafloor. MV Mafuta To face the new challenges, the company last year introduced the world s largest diamond mining vessel, the MV Mafuta, and journalists had the rare opportunity to see first-hand how this state-of-the-art vessel equipped with a crawler operates. 10 Issue 02/2014

11 Vessel Manager Simaata Irvinne Simaata said the company performed strongly largely due to the contribution of the MV Mafuta following its production upgrade in early The other four vessels are the MV Debmar Atlantic, MV Debmar Pacific, MV!Gariep and the MV Grand Banks. The media also visited the MV Atlantic vessel, which uses different mining technology. The MV Mafuta, measuring 174 metre in length and 24 metres in the beam, is one of the six vessels that Debmarine operates and it mines at a rate of between 500 and 200 square metres per hour for 100 hours continuously. The company converted the MV Mafuta to a mining vessel and fitted it with a fourth generation crawler-mounted dredge technology, Simaata explained. The vessel originally served as a heavy lift dock ship, and thereafter as a cablelaying vessel. Environmental impact According to Shikongo, environmental responsibility was at the core of the company. We recognised environmental resources as a national asset and endeavour to understand and mitigate environmental impacts at every stage in the mining lifecycle. He said the company had an Environmental Management System in place certified to the international ISO14001 standard. The company has maintained certification to this international standard since Shikongo explained that rehabilitation of the marine mining environment occurred naturally, unlike the rehabilitation of landbased mines, which took place once mining had ceased in a particular area. DBMN s environmental research focuses on greater knowledge of the natural variability of the environment, understanding the consequences of marine mining and monitoring changes over time, he added. In addition, Debmarine Namibia has a Government-approved environmental management programme for the assessment of the environmental impact associated with the company s prospecting and mining activities. Debmarine Namibia Environmental Manager, Mary Cornelia Mungungu, said the company oversees strict guidelines for the vessels. These guidelines cover everything from how to mine and how to dispose of every single piece of waste produced on a vessel ranging from food, plastic, paper and metal. No loss of life Debmarine reported that no loss of life occurred at the company in 2013 and it improved its lost-time injury with only cases of injuries to fingers reported. New leadership Change is on the horizon for the leadership of Mafuta in MV Mafuta Master, Blackie Swart is set to retire end of this month. A new Master or Vessels Captain Talent Kapipilo, a Namibian who graduated through the ranks, will take the helm. francis@observer.com.na We ensure that large-scale mining equipment, mining chemicals, spare parts such as the world s largest tyres, export product (uranium, copper, manganese) and much more - reach their destination with no fuss, on time and to anywhere in the world. We are simply your ultimate choice in mining logistics! Walvis Bay Tel: Fax: Online contact@wfs.com.na Windhoek Tel: Fax: Issue 02/

12 Timesquare Catering & Contracts Management Professional, Focused, Reliable YOUR COMPLETE CATERING AND HOSPITALITY PROVIDER Your Complete Catering and Hospitality Provider Tel: Fax: Issue 02/2014

13 Training of our staff is a priority. It is CCM s intentions to establish a training facility at the DPMT site similar to the Komesho Culinary Academy in Rosh Pinah. Most of our employees have been recruited locally and by providing them with skills and training this will in turn lead to sustainability of our fellow Namibians once the upgrade project at DPMT has come to an end. CCM believes it would have made a meaningful contribution to the community of Tsumeb and Namibia as a whole, leading to socio-economic development through training. Issue 02/

14 Mining activities kick off at Husab Mine SWAKOP Uranium detonated the first blast on its Husab Mine site on 12 March 2014 heralding the start of mining activities on what will become the world s second largest uranium mine. Swakop Uranium s Vice-president: Operations, Deon Garbers, said the company s plan was to ensure that a run-ofmine (ROM) stockpile would be ready for processing on completion of construction at the processing plant. The company has designed the mine and process plant to produce 15 million pounds of uranium oxide a year. An important recent development on the project was the securing of buffer storages for water so that the project could continue uninterrupted until they constructed a permanent water line and it came on stream. Due to significant project ramp-up, Deon explained, we envisage increased demand for construction water in the year ahead. The project team therefore mitigated the risk by filling newly-constructed ponds that have a capacity of 52,000 cubic metres or roughly ten times that of the temporary pond. A long-term off-take agreement signed with NamWater will ensure that all water used during and after the project will be desalinated, thus preserving coastal aquifers, he said. Swakop Uranium has in the meantime confirmed plans to build a 500,000 tonne sulphuric acid plant at the mine. Sulphuric acid is a key chemical used to recover uranium in an ore body. Construction of the sulphuric acid plant will start in the second quarter of Swakop uranium expects the Husab Mine to utilise all the sulphuric acid it produces at the envisaged plant. The mine will import additional acid, if needed, or source it locally. They connected electricity from the NamPower grid on 3 February through a 17 MVA mobile substation. The Husab Mine site will have up to 50 MVA by the end of the year through a permanent substation. Garbers said construction of a permanent road and bridge over the Khan River was expected to be completed by April The turnoff to the Husab mine is 45 km from Swakopmund and meanders over the Khan River Valley approximately 14 km from the B2 main road. The bridge over the Khan River is 160 m long, linking the mine to the main B2 transport route leading to Swakopmund. The surfaced road connecting the mine with the Namibian road network stretches over 22 km. Garbers further announced that Swakop Uranium had started filling permanent positions well in advance of the opening of the mine as part of the Operational Readiness Programme. This would ensure that staff would have sufficient training and be ready to hit the ground running. Training and development programmes will be designed to ensure that Swakop Uranium has world-class Namibian skills to manage such an exciting and challenging operation, he added. 14 Issue 02/2014

15 Swakop Uranium offers exciting opportunities FOUR Namibian students from previously disadvantaged backgrounds have received bursaries from Swakop Uranium for the 2014 academic year. The bursaries cover tuition fees, residency, books, meals and incidental expenses. These all-encompassing bursaries form part of Swakop Uranium s extensive training and development programme. Since the inception of the bursary scheme in 2011, a total of 16 students have received bursaries in various fields such as Mining Engineering and Chemistry. Swakop Uranium s Human Resources Director, Percy McCallum, says the company is committed towards the advancement of gender and strives to maintain a balance in bursaries awarded. Two of the 2014 bursary recipients are thus females, namely Catherine Shifotoka, who is studying towards a degree in Metallurgical Engineering, and Iyaloo Amadhila, who has enrolled for Chemistry. The other two students, Immanuel Matheus and Simson Simon, will study towards degrees in Mining Engineering and Metallurgical Engineering respectively. Swakop Uranium s success will depend on the professionalism, skills and competencies of its employees, McCallum explains. We believe that effective training and development benefits the employee and the organisation as a whole, and makes an important contribution to its competitive advantage, efficiency and profitability. He says Swakop Uranium therefore encourages its employees to attend relevant functional and technical external and internal training courses or seminars. We strive to improve the competencies of our employees and to realise their potential by developing and preparing them for increased responsibility. Swakop Uranium s new bursars at the University of Namibia s northern Ongwediva campus joined forces at the beginning of the year with two bursars who received scholarships in The 2012 bursars are Mweutupa Iyambo (left) and Tonata Silvanus (second from right). The new bursars are Simson Simon (second from left), Immanuel Matheus (middle) and Catherine Shifotoka (right). Swakop Uranium s success will depend on the professionalism, skills and competencies of its employees. We believe that effective training and development benefits the employee and the organisation as a whole, and makes an important contribution to its competitive advantage, efficiency and profitability. He says the company s training and development policy aims at ensuring employees receive adequate training to meet the challenges resulting from change in technology and business requirements; and that training is need-driven and cost effective. McCallum points out that the company s commitment towards the development of various management and technical fields, is for the benefit of both the company and the country. Swakop Uranium is committed towards the achievement of Vision 2030, in particular the development of human resources in the country. To this end, Swakop Uranium has identified a Namibian engineering graduate who wishes to study towards a Master s degree in Drilling Engineering. Swakop Uranium will finance the student, Mateus Vaino Ipinge, to attend university on a 30-month programme in China. Swakop Uranium will also place at least 10 university graduates in the company to undergo an intensive formal training programme aimed at providing them with the opportunity of planning their future careers. McCallum says Swakop Uranium recognises the skills shortages in Namibia. Through our strategic human resources development drivers, we focus on the sustainable development of our human resources skills. We focus on developing competent and professional human capital for Namibia, thus elevating the skills levels and the employability of graduates, he says. Issue 02/

16 Johanna, a Namdeb STAR taking ownership Namdeb s values, namely safety, teamwork, accountability and respect (STAR) are key behavioural principles that all employees need to live by in order to secure a future to 2050 and beyond. Namdeb therefore takes time to single out employees that it regards as STARs. Johanna Kamati is one example of an employee whom one can describe as a STAR employee who takes ownership and pride in the equipment she uses. Johanna is not the only one of the rare female mine shift leaders, but a distinct multi-skilled operator, who takes great care of the machines she uses. Various service providers, her superiors and mining stakeholders have witnessed and acknowledged Johanna s enthusiasm. Asked what drives her to operate her machines with such great care, Johanna replies with a smile that it is important to take care of the machines because she realises that without these tools, it would be difficult to reach the set targets. Johanna believes that hard work pays off, and irrespective of her gender, she is keen to contribute towards SCM and Namdeb at large to achieve its targets for 2014 without anyone getting hurt or any vehicle accident. Together we can take Namdeb into a sustainable future towards 2050 and beyond, she reiterates. Since 2002, Johanna has operated a variety of mining machines such as PC200, PCR200, PC800/385, and she enjoys what she is doing. She confesses that safety is her first priority, and thus she takes great ownership of the mining machines she uses to prolong the machinery life and to minimise the maintenance cost. It is important that we take accountability for our equipment, because without respect we cannot meet our daily targets and produce enough carats. Before I start operating the machine, I normally inspect my working area first, and I try to identify any potential hazards and if identified, I will make sure everyone knows Johanna inside a PC800 cabin about it. A pre-start check of the machine is very important, she said. She also stated that it was essential to look out for one another. Johanna remarked that as it was evident that vehicles and moving machines remained the number one risk, it required all efforts to prevent and reduce incidents. 16 Issue 02/2014

17 Issue 02/

18 B2Gold Leaving a Legacy B2Gold Namibia considers responsible corporate citizenship a key component to maintaining a strong reputation within the communities which it operates. The vision of the company is not only about being a profitable mining company, but also about being a company that makes a meaningful difference, leaving a legacy to be proud of even after mine operations have ceased. To this end, the company has already run a fully-fledged CSR department since 2012, has a strong HSE record and has turned 16,000 hectares around the Otjikoto mine area into a conservation area all prior to pouring its first doré bar. Corporate Social Responsibility Construction of the Otjikoto Mine will be complete towards the end of 2014 and first full year of production is expected in Despite this timeline, B2Gold has already spent N$3.4 million on CSR projects in 2013, and has a similar budget for B2Gold s CSR Department has already had a busy first quarter in The department strives to make a positive difference in the lives of its stakeholders through projects that focus on Education, Health, SME Development and Conservation. Projects funded since the start of 2014 include: Afoti Pre-Primary a village in the North: 23 learners received backpacks, stationery, wooden desks and chairs, educational books and school uniforms. ELC Scion Hostel in Otjiwarongo acquired two washing machines, bedding for 110 boarders, cutlery, school uniforms, curtains, 10 dining room tables and 20 benches. MamaKai Orphanage in Katutura in Windhoek received 21 mattresses, stationery, toys, shoes and firewood benefiting 21 orphans. Hare Wado: a kindergarten in Otjiwarongo received 20 mattresses, stationery, and school uniforms. Eugene Reineke: a waiter at a hotel in Tsumeb who uses his tips to care for vulnerable children in the community received two five tonne truckloads of firewood, educational books, cooking supplies and food staples for 120 dumpsite children in the informal settlement. Lourentia: A young woman from the North, travelled to the US to have a prosthetic leg fitted which world-renowned prosthetic experts doctors Phil Connelly and Nick Roumonada from Hangar Clinic in San Diego, California designed and donated. A team of B2Gold employees in the US opened their hearts and homes to make it all happen, and B2Gold sponsored Lourentia s airfare. Many thanks to the chiropractors, nutritionists, physical therapists, occupational therapists and everyone else who contributed to this adventure. Bundles of Love (firewood generated by bush-clearing activities from the Otjikoto Mine), continues to warm the hearts of 912 beneficiaries in the Otjozondjupa Region. The beneficiaries are from many different backgrounds and ages, ranging from the elderly to orphans, single parents, the physically challenged, community hostels and welfare organisations. Elephant Energy (an NGO) and B2Gold have started a partnership to supply solar products to remote villages in the Otjozondjupa Region. Solar products utilise clean energy, increase educational capacity and, most importantly, offer affordable electricity solutions to rural Namibians who don t have access to grid electricity. It also provides income-generating opportunities to new 18 Issue 02/2014

19 entrepreneurs who can sell and distribute these solar products. As the B2Gold CSR department continues its work, it will place emphasis on developing long-term, sustainable projects. By focusing on long-term projects, livelihoods will develop, resulting in capacity development, skills transfer, entrepreneurship, economic independence, and employment growth for the Otjozondjupa Region. B2Gold Farm and Educational Centre B2Gold Namibia is the owner of five commercial farms, measuring approximately 16,000 ha inside which the Otjikoto Mine will be located. The company has turned this land into a conservation area a project that rests on three pillars: SCIENCE: Support for scientific research EDUCATION: Development of an educational centre of excellence CONSERVATION: Illustrate how mining activities can be a direct benefit to the environment and conservation It is B2Gold s aim to demonstrate clearly to the government of Namibia and all stakeholders that a well-run mining operation can serve as a positive catalyst for environmental rehabilitation and wildlife conservation. Health, Safety and Environment B2Gold recognises that occupational health and safety are an integral part of its business. It believes that sound occupational health and safety practices are in the best interest of all stakeholders and is committed to implementing superior occupational health and safety management in all project phases. The company will achieve effective management of this policy by: Ensuring that all employees and contractors have the necessary training to understand their health and safety responsibilities under the company s policies and procedures; Ensuring that all employees and contractors have proper personal protective clothing and equipment; Ensuring compliance with all applicable regulations, laws, and guidelines as well as accepted best practices; Establishing clearly defined occupational health and safety programmes, complete with clearly established targets and performance indices that will allow for tracking of continuous improvement; Investigating the causes of accidents and incidents and developing effective preventative and remedial actions; Ensuring that leadership is held accountable for safety at all operations; Conducting regular audits to monitor performance and achieve improvement; Recognising and rewarding safe behaviour by employees and contractors; and Working proactively with stakeholders to define occupational health and safety priorities for the company and the industry. B2Gold Namibia has not suffered a Lost Time Incident (LTI) in 2014 and has worked a total of 1,539,024 man-hours since its last LTI. B2Gold Namibia had a LTI incident rate of 0.4 for 2013 with one contractor incident and one employee incident.* *Data correct as of April 15, African Wire Ropes Oblongs sub-assembly From 7mm to 32mm Crosby clamps from 3mm to 90mm Safety sling hooks from 7mm to 32mm Chain Blocks & Lever Hoists (Yale Brand) from 0,5 tonne to 6 tonne Grab hooks from 7mm to 32 mm Polyester slings From 1 tonne to 6 tonne Crosby bow shackle From 0.75 tonne to 120 tonne One Legged Steel Wire Rope Sling 6-32mm Two Legged Steel Wire Rope Sling 6-32mm Three Legged Steel Wire Rope Sling 6-32mm Four Legged Steel Wire Rope Sling 6-32mm Steel wire ropes from Chain slings, adjustables 1mm Chamber to 113mm from 1 4 legs, Tonnage up to 85 tonnes of Mines News Hammer-locks from 7mm to 32mm Fibre Ropes, Manila Ropes, Cotton Ropes, Nylon Ropes, Tow Ropes (with spliced eyes according to specifications) from 4mm to 96mm Issue 02/ ienie Louw Street, Nothern Industrial AreaTel: (061) , Fax: (061) , Windhoek, Namibia

20 Renewable energy interest threatens uranium industry Christine-Rita Abankwah The decision by European countries to move away from nuclear energy has had a negative effect on Namibia s uranium industry and mining companies consequently see it as a major investment hurdle, Rössing Uranium MD Werner Duvenhage has said. Duvenhage made these comments in an interview following last week s European Union (EU)-Namibia Trade and Investment for Job Creation and Development Roundtable discussion that was held in the capital. The decision by the European countries resulted in a reduction in demand for uranium and subsequently the price dropped by more than 50 percent. This has a very negative impact on the Namibian economy. We have already seen the Trekkopje mine go into care and maintenance and Rössing unfortunately had to retrench almost 300 people in 2013, also as a result of the low prices. It also has a significant impact on the royalties and taxes that Government receives, the Rössing MD said. Since Japan s 2011 Fukushima disaster, which resulted in uranium prices plummeting significantly, countries in the EU have started leaning more towards renewable sources of energy. After the nuclear plant disaster, German Chancellor Angela Merkel launched an ambitious drive to shut down that country s nuclear reactors by In terms of the plan, Germany s energy mix should consist of 40 to 45 percent of renewable energy, and up to 60 percent by France has also been debating shifting away from nuclear to renewable energy. President Francois Hollande last year called for France to reduce nuclear energy to only 50 percent of the country s power supply by However, commentators called this a drastic move, considering that country s heavy investment in, and reliance on nuclear energy. Even in Japan, renewable energy experts believe the 2011 nuclear plant disaster presented an opportunity to move towards natural energy sources. Nevertheless, Namibia s uranium production remained relatively high at 5,382 tonnes in 2013, despite declining international prices, according to a Bank of Namibia report. Pre-Fukushima, uranium traded at about US$70 per pound. In 2012 and 2013, prices averaged US$49 and US$38.9 per pound, respectively. At the beginning of May 2014, prices were reported to have reached a low of US$29. In an earlier interview, Duvenhage said he expected uranium prices to remain depressed in the short to medium term. He said this would make new projects very hard to justify, and consequently impact on growth in the portion of the market truly exposed to market conditions. This may not be the case for projects where the same owners of the mine also use the product in their nuclear reactors, he said at the time. Even though Namibia s uranium production remained high, 2013 production decreased by 2.4 percent due to operational challenges at the mines, with BoN noting limited water supply as a factor. Duvenhage said the underperformance of State-Owned Enterprises (SOEs) was another investment hurdle facing the industry. Mines were extremely reliant on SOEs to drive development and deliver on the services, which they usually have a monopoly for, he said. [For example,] NamWater should be able to provide affordable water to all industry otherwise development cannot continue. It is also important that our rail network is well-maintained and that TransNamib is able to source and supply additional rolling stock should it be required. Managing Director at Rössing, Werner Duvenhage 20 Issue 02/2014

21 A good example is the major expansion that is happening at NamPort at the moment they are proactively preparing themselves for economic growth, he said. Other investment hurdles included Namibia s small economy, increasing taxes and development burden. Duvenhage said that in a small economy like Namibia, not all goods and services that a mining company required were available compared to large economies. In addition, the industry has seen the introduction of the training levy and a 15 percent surcharge by NamWater on big commercial clients. This is also a tax since the surcharge is not used for capital improvements to the mines, because the mines pay for capital in water infrastructure development in advance. Mine owners are also faced with developmental burdens when they develop a new mine, which poses financial challenges, he said. When a new mine is developed, the owners must develop all infrastructure to that mine, including power and water. They have to provide all the money for the development and thereafter hand it over to the SOE. These total significant amounts of money. If the mines then also have to pay surcharges on top of that, it becomes costly, Duvenhage said. On a more positive note, the Rössing MD noted the country s investment enablers, which included political stability, good infrastructure, robust and predictable regulation, connections to international markets (shipping and air), a stable fiscal regime and a well-developed financial services/banking sector. /Gaeb Dredger takes Namdeb to 2050 and beyond NAMDEB continues to play a leading role in coming up with innovative ways to extend the life of its mines and in so doing adding value to help sustain Namibia s economy. In the quest to extend Life of Mine (LOM) and production, the company recently launched the /Gaeb dredger (which means Gemsbok in the Nama language), at the Southern Coastal Mines to help with accretion for the next two years. Namdeb relocated the /Gaeb from Pocket Beaches (Bogenfels) and modified it to suit its current working environment in Southern Coastal Mines. The process of moving the material from the #4 Plant and dump into the sea to create square metres (m²) enabled production stripping at the Southern Coastal Mines. Production commenced in March As part of Namdeb s commitment to mining sustainably, the dredger went through modifications to suit its current working environment in Southern Coastal Mines. These modifications included changing its use of diesel to electricity. The dredger is a very cost effective mining tool. On average, it can move approximately 1,500 tonnes of sand per hour. The length of the discharge line is approximately 1,100m long and the pipe diameter is 610mm OD. At any given time, two staff members can operate it but the long-term goal is to operate it on a continuous basis. Issue 02/

22 OUR VALUES Dignity and Respect We care about people their well-being, their careers and development, and their day-today work experience. We treat all colleagues fairly, listen to their input and work with them to create solutions that respect both individual needs and corporate interests. Continuous Improvement We are passionate about continuous improvement. We seek out and execute operational practices that drive innovation, speed to market, cost efficiency, technical and professional excellence. Transparency We set and uphold the highest ethical standards and business practices. Our dealings with employees, governments, stakeholders and communities are open, honest and transparent. We do what we say we will do and fulfill our commitments. We hold each other accountable for delivering results. Environmental Responsibility We are leaders in promoting sustainable growth and environmental responsibility. We go beyond legislative compliance to promote pragmatic environmental solutions and practices in all of our operations. Safety The health and safety of our employees and local communities are paramount and enable us to be in business. Safety can never be compromised. Community Investment We care about the quality of the communities in which we operate. Our legacy will be to ensure we have helped residents make the community a better place than before we arrived on the scene. We have a strong corporate and ABOUT US Namibia's premier copper manufacturer significant step forward for environmental Dundee Precious Metals Tsumeb owns and responsibility that has no precedent in Namibia. Five operates the Tsumeb Smelter, the only facility of its state-of-the-art monitoring stations have been kind in Namibia and one of only a handful of copper- installed by the company to measure emissions not processing companies in the world that can smelt only at the Tsumeb Smelter, but also beyond the complex metal concentrates, especially those fenceline in the greater Tsumeb community. bearing high volumes of arsenic. The Tsumeb Smelter is unique in this respect, and therefore a The cost of the stations alone N$5 million value-added asset for Namibia's mining and demonstrates the company's commitment to find manufacturing sectors. pragmatic solutions and practices to environmental problems. The strategically placed monitoring Both blister copper (98.5% Cu) and arsenic trioxide stations are the first of their kind in Africa to measure (As2O 3) are produced at the smelter. The blister arsenic trioxide levels. Plus they meet, and in some copper is delivered to refineries in Europe for final cases exceed, U.S. Environmental Protection processing, and the As2O3 is sold to third parties. The Agency recommendations. smelter is capable of processing 270, ,000 tons of metal concentrate per annum. The units provide real-time, publicly accessible data about arsenic dust and other airborne particulates, The smelter features a primary smelting furnace as well as sulphur dioxide emissions, and give (Ausmelt), three Peirce-Smith converters and two important information to company management to oxygen plants,as well as dust-capturing baghouses, ensure the smelter continues daily to operate in a high-tech gas-cleaning and fume-extraction responsible manner. systems, state-of-the-art environmental monitoring Looking to the future, Dundee Precious Metals equipment, a pneumatically operated arsenic plant, Tsumeb is also researching new and innovative a slag-treatment mill and an international-standard ways to manage its arsenic waste products to hazardous waste storage site. At present, a N$2.3 minimize potential impacts on the environment and billion plant designed to convert sulphur dioxide into the human population. Currently, hazardous dust commercial sulphuric acid for sale to Namibia's from smelting is stored in a licensed, appropriately uranium industry is in the early stages of engineered repository within the smelter complex. construction. On the horizon is the installation of a Dundee management wants to go beyond legislative modern, multimillion-dollar electric holding furnace compliance by investigating ways to convert the that will enhance production output and place the waste dust into more benign forms and possibly Tsumeb Smelter square on the threshold of even extract residual metal value from it in the becoming a global competitor. process. For this exciting work, Dundee Tsumeb is partnering with scientists and metallurgists both Dundee Precious Metals Tsumeb is a subsidiary of locally and in Canada. Dundee Precious Metals Inc. of Toronto, Canada. It employs more than 800 people, including Reaching out contractors. In a recent NaMedia report, Dundee Precious Metals Tsumeb was listed eighth among Namibia's Best A forward-thinking company Communicating CEO Brands of social responsibility to the Dundee Precious Metals Tsumeb has taken a communities 22 Issue 02/2014 in which we invest.

23 2117 INVESTING FOR GLOBAL LEADERSHIP IN URANIUM HATS OFF TO THE NAMIBIAN MINING INDUSTRY INNOVATIVE FINANCING OF TECHNOLOGY SUPPORTING EXPANSION AND NEW MINE DEVELOPMENT FOCUSED VALUE-ADDITION FOR NAMIBIA THINK NAMIBIA. THINK RMB. RMB is proud to implement specialist solutions for Namibia s mining industry, supporting exceptional innovation, expansion and new mine developments. RMB has an experienced team of mining specialists engaged on a range of mine developments and projects across the Uranium, Diamonds, Precious & Base Metals and Industrial Minerals sectors. We have established ourselves as Namibia s premier advisory, structuring and financing institution. For more information, contact Steve Galloway or Henk Ludik on or visit Thinking that can change our world. RMB Namibia is a division of FNB Namibia. Issue 02/

24 24 Issue 02/2014