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PRESENTATION TO ABANDONED MINES: SCIENCE BUSINESS SOCIETY DIALOGUE CONFERENCE

INDABA HOTEL JOHANNESBURG28 NOVEMBER 2017

Abandoned Mines: Strengthening Mining Policies andResearch

Nikisi LesufiSenior Executive

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The Chamber - who we are, what we do

Chamber of Mines of SA is a mining industry

employers’ organisation that supports and promotes

the SA mining industry. It:

• serves members and promotes their interests by

providing strategic support and advisory input,

representing members in all key policy debates

affecting mining

• facilitates interaction among mining employers to

examine policy issues and other matters of mutual

concern to crystallise and define desirable industry

standpoints

• acts as a principal advocacy group for mining in SA

and internationally, communicating major policies

endorsed by its members

• fulfils a vital function in coordinating and

representing certain producers in centralised

negotiations with organised labour

Majors

Emerging miners

Associations*Corporates

Our members

• Represent about 90% of SA’s mineral

production

• Employment of 495,000 people

• Contributed around R18bn in taxes

• Contributed around R102bn in employee

earnings

*representing about 80 companies comprising

nearly 250 operations

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Chamber vision for SA mining industry

Workforce,

transformed, productive,

fair wages and non-

discriminatory, safe and

healthy workplaces –

ambassadors of the

sector

Management not only

focus on profits, but

provide decent jobs, play

positive role in mining

communities and

sensitive to environment

Government, trade unions and

the community: proud of and

fully supportive of the mining

industry and acknowledge

industry as important for the

country

Key exporter

Key earner of foreign

exchange

Key transformer

Key taxpayer

Creator of decent jobs

Developer of skills

Key contributor to economy

Investors regard industry

as a good investment

destinationCONSTRUCTIVE PARTNERSHIPS

BUILT ON TRUST

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The Chamber – Member of MIASA and ICMM

• Mining Industry Association of Southern Africa is a Chamber of the Chambers of Mines in

SADC (except Lesotho and Swaziland) - supports and promotes the mining in the region

Develops position papers on various common issues

o Water, Climate Change, Ownership patterns in mining by governments, skills

development for mining and community development

Secretariat in RSA

• International Council on Mining and Metals represents 16 largest mining corporates and

approx. 30 chambers of mines across the globe

• Mining with principles approach – provides and catalyses thought leadership in improving

environmental and social performance of ICMM members and improving social acceptance of

mining by society.

• Role of Minerals in Society

• Material Stewardship

• Occupational Health and Safety

• Environmental and Social Stewardship

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South African Mining Industry Facing Challenges

Global commodity prices fluctuations

• Rand prices of key export commodities have plunged (except more recently, gold)

• Significant portion of gold and PGM sectors are loss making

Domestic cost pressures risen too quickly for mining inputs

• Electricity prices trebled in 7 years, not considering the current proposals

• Wages up >10% pa during past 5 years

• Stores and materials up >10% pa (steel up 12% pa during past 5 years)

Productivity has plunged

• Platinum output per worker has declined 49%, real labour costs/kg up 309% (1999-2014)

• Due to declining grade, aging mines, production disruptions and inability to increase productive shifts per annum

Trust deficit amongst stakeholders and other role players

• Policy uncertainty

• Negative investor sentiment

Legacy Issues

• Social and Environmental Legacies

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Chamber’s Strategic Intent

Science Business Society Dialogue Conference - Mining Policies and Research

1

Creating an enabling, business friendly policy, legislative and operating environment for

a sustainable and successful mining industry (enabling a doubling of real mining

investment by 2030)

2Promoting a positive image of the SA mining industry among stakeholders and society

(Chamber effectively engaging key stakeholders and society)

3Chamber and its members to implement a positive contribution model (including

contributing to the NDP)

4Leading by example, demonstrating progress on transformation, safety, social and

environmental imperatives (including through sharing best practice)

5 Improving the effectiveness and performance of the Chamber

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Abandoned Mines: Policies and Research Considerations(1)

• Abandoned mines: Is it a unique RSA problem?

Unique context – apartheid and politics

• Enabling regulatory framework

integrated mine closure considerations (not only land

rehabilitation

• Development of a dynamic national mine closure framework and

strategy

Identification and delineation of regions – science based

• Adoption of regional integrated closure approaches

As dictated by the unique set of circumstances of the region

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Abandoned Mines: Policies and Research Considerations(2)

• Enhancement of collaboration amongst stakeholders and role

players

• Intergovernmental collaboration

• Multi-stakeholder involvement and participation

• Mining companies

• Other private sector interested parties

• NGO’s

• Community representatives

• Multilateral and donor agencies

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Abandoned Mines: Mitigation Measures by Current Operations (1)

• Compliance with regulatory requirements

( at mining operation level)

EMP

SLP

WULA

And other regulatory obligations, e.g MHSA etc

Active stakeholder engagement processes

Company level

Ethical corporate policies

Accountability frameworks

• Integrated and collaborative approaches

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Abandoned Mines: Mitigation Measures by Current Operations (2)

• Industry level

• Development of voluntary integrated frameworks for collaboration and implementation of industry wide initiatives to enhance and facilitate sustainable closure of mining operations

Modernisation and Innovation : Mining’s journey of collaborative innovation onwards…

Health and Safety: Masoyise iTB & Post Retirement Benefit Management Systems: Effective Information Management Systems

Legacy Issues

o Occupational Lung Diseases

o Acid Mine Drainage

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Abandoned Mines: Concluding Remarks

• Regional Approaches

• Square the circle : Individual license but common

responsibilities and obligations

• Enabling regulatory frameworks

• Carrot and Stick

• Ethical Corporate Policies and Accountability Frameworks

• Management of Local Community and Political Dynamics

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Final Thought

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THANK YOU FOR YOUR ATTENTION!

ANY QUESTIONS??

Nikisi Lesufi

Senior Executive

Chamber of Mines of South Africa

Tel: 011 498 7661

Fax: 011 498 7429

Email: nlesufi@bullion.org.za