Mining Mirror June 2019 | Page 3

Comment The scourge nobody talks about Get in touch @LeonLouw3 [email protected] www.miningmirror.co.za A consultant recently asked me what risks a company that intends investing in a coal mining project in South Africa would face. We went through a whole list of possible scenarios and looked at the political climate, economic future and social and environmental concerns. He then asked me about illegal mining and how it affects coal mining operations. It was an interesting question and something I hadn’t thought about much. As far as I knew it wasn’t such a big issue as in the gold mining sector, for example. I knew, however, that coal theft, and not so much illegal mining, was a problem in some areas of Mpumalanga. Coincidentally, a day later, I read an interesting article about the atrocious quality of coal that is delivered to some Eskom power stations. According to the article, what Eskom receives, is not what they are supposed to put through their boilers. There is more clay, rock and other dubious material in the supplier consignments than actual coal, which explains the inefficiencies and downtime, and ultimately load shedding. How this happens, is an open question. Strict quality checks are supposed to be carried out (by registered laboratories) on site before a truck leaves, at weighbridges and again when it arrives, to check if it is the same coal the truck loaded on site. The article blames coal mining companies who blatantly disregard procedure and regulations, and in a way, this is true. After all, since the Guptas and Tegeta dismantled all checks and balances, and started playing by their own rules, it has been a free for all, and I have no doubt there are companies that deliver inferior coal to Eskom. In the short term it benefits their own pockets, but in the long term, they are inflicting irreparable damage on the state-owned power utility that keeps their crushers grinding. Nonetheless, after a trip down to the coalfields of Mpumalanga and Bronkhorstspruit, where I spoke to Coal theft is regarded by those in the know, as not one of the risks a coal mining company operating in South Africa has to face, but the number one risk. several operators, it became clear that the real problem is coal theft. Crime syndicates have taken advantage of the lack of proper quality checks, the dearth of skills and experience, and the general misrule that has befallen the country. Truck drivers either get paid, or are forced (often at gunpoint), to unload the good quality coal, which is then replaced with the “rubbish” that gets delivered to our power stations. Coal theft is regarded by those in the know, as not one of the risks a coal mining company operating in South Africa has to face, but the number one risk. And it does damage to Eskom and the reputation of coal mining companies. Moreover, it is costing them money. They have to employ their own small army to protect trucks and drivers. Coal theft is the scourge that nobody talks about. Leon Editor JUNE 2019 MINING MIRROR [1]