Exploration is key for South Africa's mining sector

South Africa has come to be known for its lack of exploration capacity in a mining context, although there are several opportunities to turn this perception around according to PwC South Africa Partner Andries Rossouw. Going forth, the country should be focused on minerals used in developing batteries.

According to Rossouw, South Africa is rich in minerals such as vanadium, which are growing in demand across the globe. As the country works towards developing its exploration and extraction capabilities, it would benefit significantly from working towards more vanadium production.

In doing so, Rossouw predicts that South Africa’s mining sector will be helped along by a number of other factors. The sector, which contributes approximately 10% of the GDP, has been struggling amid dipping commodity prices in recent times, although the infrastructure and knowhow is in place to support regeneration.

Years of mining have made South Africa is recognised mining centre in the global economy, while most experts recognise that the country’s biggest shortfall comes in the sphere of exploration. Mining industry experts have previously indicated that South Africa has large mineral reserves that remain untapped and undiscovered.

As a result, exploration is the need of the hour for the country, as it looks to rebuild its position as a leader in mining. A PwC report from last year highlighted that structural change is crucial to bring respite for the sector, changes that include investment in technology and a more sustainable approach to extraction. 

Rossouw has now offered insight on how structural change could be brought about in exploration. “There is nothing better to incentivise exploration than increases in price on the back of increased demand, as is evident from the lithium exploration spree,” he said.

“As a country endowed with a concentration of commodities which could play an active role in the energy transition such as PGM’s, manganese, and vanadium, South Africa is uniquely placed to drive commercialising of new battery technologies. If widely rolled out, these new uses could fuel demand, increase prices and eventually lead to increased exploration,” he added.