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October 2009


Petra Diamonds Limited has announced the recovery of an enormous 507.55 carat white diamond at its Cullinan mine outside Pretoria.


This spectacular gemstone was recovered on 24 September 2009 and is currently with experts for analysis. Initial examinations indicate that it is of exceptional colour and clarity and most likely to be a Type II diamond. The company has said it will increase more details, including colour grading and clarity, once the diamond has undergone analysis.


The diamond was recovered alongside three other special white stones of similar colour and clarity in the same production run: another very large stone of 168.00 carats and two other stones of 58.50 and 53.30 carats.


At 507 carats (just over 100 grams) the diamond, which has yet to be named, is considered to be among the top 20 largest high quality rough diamonds ever found worldwide and ranks alongside other illustrious diamonds recovered at the celebrated Cullinan mine.


Cullinan has a special place in the history of diamonds as the source of the world’s largest gem diamond ever recovered – the “Cullinan”, at 3 106 carats rough.


It has also produced another two of the world’s largest diamonds, the Golden Jubilee at 755 carats rough and the Centenary at 599 carats rough, and many other famous gems including the Taylor-Burton (69 carats polished).


Johan Dippenaar, Petra’s chief executive officer, commented on the find saying: “The Cullinan mine has again given the world a spectacularly beautiful and important diamond. Initial indications suggest extraordinary potential for its polished yield. We now eagerly await the findings of the expert analysis.”


Small Business Start-Up Fund

Anglo Zimele’s Small Business Start-Up Fund provides loan funding up to R1-million per project and has become Anglo Zimele’s flagship initiative, with a current total of 12 small business hubs and a variety of SME beneficiaries throughout South Africa, in and around the mining operations of Anglo Coal, Anglo Platinum and Kumba Iron Ore.


Since the fund was launched in October 2007, it has approved 368 loan transactions with a value exceeding R95-million. A total of 3 504 people are being employed by these 368 start-ups. Since October 2008, the fund has effectively approved a transaction a day. The fund is the only one of its kind to reflect the global trend towards supporting entrepreneurship at the “base of the pyramid” – the poorest socio-economic group.


The success of the fund can be attributed primarily to the low fixed interest rate of its loans, although other critical contributors to success are business support, training and mentorship provided by Anglo Zimele. Of the 468 entrepreneurs benefiting from the Small Business Start-Up Fund, 39% are women and 33% are youths (18 to 35 years old).


To support the entrepreneurs benefiting from this fund, Anglo Zimele has introduced business mentors at the fund’s small business hubs with services such as business planning, training, coaching, mentoring and accounting advice.



Tackling the problem of adult illiteracy in South Africa is a challenging task. Local adult education training specialists, Media Works has responded by developing a training programme that addresses a number of these issues.


Suitably named, Accelerate, the programme can reduce the time needed for learners to complete an ABET level. In addition, Accelerate offers the very best in learning material to both learners and facilitators. The result of years of experience and exciting innovation, Accelerate is the most comprehensive training product on the market.


It is well suited to the mining sector that has to balance the pressure of mining production times. The faster training turnaround time is a result of programme elements that include a comprehensive facilitator’s guide; an all-inclusive learner book; an integrated portfolio of evidence; a range of continuous assessment; and updated and relevant content. These elements are combined with Media Works’ popular computer-assisted methodology to ensure that learners progress quickly and can apply their knowledge in daily life.


“The combination of our greatest strengths, experience and innovation, makes Accelerate our flagship product,” says Jackie Carroll, Media Works’ managing director. “But more important, it assists training managers to reduce training costs. Accelerate will appeal to managers looking for a training solution with reduced training time, the provision of comprehensive information for both the facilitator and learners, reduced administration requirements and continuous assessments that are a safety net for quality control.”


Pointing out the importance of Accelerate for the ABET sector, Carroll adds, “Accelerate is a complete rewrite of our training materials. It provides a fresh approach and excellent quality that will enhance training for both learners and facilitators.”


“As our flagship product, Accelerate is also informed by our 14-year experience servicing both corporate and public sector clients,” says Carroll and adds, “In recent years, the profile of ABET learners has changed significantly. Today’s ABET learners also include learners who want to improve their English literacy or their computer skills.”


Accelerate allows for the more competent learner to undergo faster training without sacrificing quality, while learners who require more attention are given ample opportunity to improve their skills.


Feedback from both facilitators and learners has been exceptionally positive from the over 300 clients currently using Accelerate. “We are very excited about the feedback we are receiving from the market, it confirms that Accelerate is the solution we have all been waiting for.” says Carroll.


With a view to launching the product internationally, certain key sections have been earmarked to be customized for an international context. Reference to currency, as well as the selection of reading passages can easily be adjusted to fit the needs of international expansion. 



Coal-bed methane (CBM) widely regarded as an obstacle in the coal mining industry, is instead fast becoming known as a commercially viable energy source. The approach to CBM has changed radically over the past decade or so as global warming concerns and increasing coal prices highlights the need for alternative energy sourced that are less detrimental to the environment.


Research in the United States, Canada, China, India and Australia has demonstrated that capturing methane and harnessing it as a productive energy source can dramatically decrease detrimental effects on the environment – so much so that burnt or used CBM is 22 times less harmful to the environment than when it is left to escape un-burnt. It also has 21 times greater heat trapping value when released into the atmosphere than carbon dioxide. Based on its environmental footprint, every opportunity should be taken to remove CBM from the atmosphere. One of the best ways to do this is to use it in energy production.


CBM extraction methods

CBM is a naturally occurring methane gas trapped inside coal. Historically, it is viewed as one of the primary dangers in coal mining owing to its highly flammable nature. Usually, the pressure of CBM requires a coal seam to be degassed before being mined – typically by drilling vertical boreholes down to the coal seam, or horizontal holes into the seam ahead of the face. By reducing the natural pressure within the coal steam, CBM, which is lighter than air, is allowed to escape into the atmosphere.


Admittedly, CBM is technically challenging to extract. The CBM mining method directs the gas, once released from the coal seam, to a well, where it flows to the surface, is compressed and then transported through natural gas pipelines. Once extracted, CBM can be used for electric power supply, co-firing boilers, district heating and mine heating. It can also be converted into liquid diesel fuel.


Future of CBM mining in Southern Africa

There are calls for change to coal mining activities to ensure that this resource is used effectively. South Africa is the world’s sixth largest coal producer and the industry is the nation’s second biggest mining sector after gold. Coal sales contribute 20% of South Africa currently ranked as the third largest coal exporter in the world. Simply put, the potential for CBM extraction exists and there is a growing market for energy.


The Department of Mineral Resources confirmed that interest in prospecting for CBM in South Africa has increased. It reports a large number of applications for rights to explore for this resource and that CBM empowerment entities, such as Badimo Gas, a black economic-empowerment company focused on CBM, are emerging.


Since CBM mining is in the exploration phrase, the full extent of the resource is still to be refined. Recently, South Africa’s most advanced CBM exploration project occurred in the Waterberg area, north of Limpopo.


In 2006, Anglo Coal completed its pilot-phrase CBM project, located in the eastern portion of the Waterberg basin – an area containing up to one trillion cubic feet of recoverable methane gas, enough to provide gas to 10 million homes for one year.


There are also large coal reserves in the western part of Limpopo Province and these are associated with significant quantities of CBM.


In Botswana the Karoo Coal basin is attracting the interest of companies keen to sell energy into the southern African region. It is on the edge of this basin that CIC Energy wants to locate its multibillion-dollar Mmamabula Energy Project, which comprises a coalmine, a power station and possible a Sasol-like transport fuel factory. Coal on the basin’s edge is relatively shallow and accessible, but it is in the deeper seams of the basin’s inaccessible core that CBM resides. The project is viewed as having sufficient scale potential to host the world’s largest commercial CBM venture.


The company exploring the core of the basin is Saber Energy Corporation, which, like CIC Energy, falls under the umbrella of the TSX-listed Tau Capital. Saber has reportedly been on site since December 2007, and has been drilling since March 2008 to ascertain the extent of the CBM resource at three concessions spanning over 14.6 million hectares, near Mahalapye, in Botswana.


Saber drilled 65 first-phase holes to test the coal’s gas content, study the mechanics of the rock and gauge its permeability. Exploration has reportedly exposed several thick coal seams that contain 98% pure methane. The CIC Energy Project and the Saber Project combined are poised to help Botswana lower its dependence on diamonds and herald a new era of economic diversification.


Role of government

While the CBM players create a market for the gas it is important for governments to help get the industry off the ground. CBM investors should be aware of the sector’s teething problems, such as monopolies that must be broken down to facilitate the best use of this energy source for a new energy resource to emerge a gap in the energy market needs to be opened and an advantageous niche created delays in rights conversions and the lack of expertise in unconventional gas deposits within governmental authorities as well as the lack of incentives for developing gas businesses are major hurdles.


The Australian government supplies its mines with the tools to extract CBM, which is used to generate electricity for the mine itself. Surplus gas must be sold to nearby electricity companies. In India, government incentives include no participating interest by the state, no upfront payment, no signature bonus, exemption from payment of customs duty on imports required for CBM operation, freedom to sell gas in the domestic market and a seven-year tax holiday.


To attract new CBM players and sustain the existing industry, these options should be explored in southern Africa. Governments need to be motivated to develop this industry by assurances of job creation, billions of investment rands, reduced fuel imports and new industries.



Although CBM energy delivery falls short of that provided by conventional coal mining, it is delivered with substantially lower social and environmental costs and in circumstances where coal resources cannot be practically or economically accessed. Even so, CBM has not featured prominently as an alternative energy source.


The good news is that South Africa’s newly appointed minister of energy, in collaboration with the minister of mineral resources, has undertaken to engage seriously in the development of this natural resource – hopefully, sooner rather than later.



Bowman Gilfillan has established itself as a leader in the field of mining law in South Africa, and was instrumental in the development of the new mining law regime. It regularly advises on all matters relating to mining legislation, assets and the conversion, acquisition and disposal of mining rights and titles. Its expert advice is sought for environmental, occupational health and safety and mining regulation issues. The group also has expertise in advising on a wide range of natural resource exploration and beneficiation projects, ranging from forestry to gas.


The commencement of Mineral and Petroleum Resources Development Act in April 2004 radically transformed the law governing rights to mineral resources in South Africa. This has caused a significant increase in the transactions in this sector. Bowman Gilfillan is well placed to take advantage of this upsurge and has represented a number of foreign companies seeking a foothold in the lucrative South African mining sector. It has also represented a umber of BEE companies, and has given them an opportunity to acquire a stake in the wealth of South Africa’s natural resources.


Mining advice

The firm acts for a number of listed and unlisted mining companies. It frequently advises on transfers of mining rights, protection of mining assets and sales of mining companies. For example, its work in this sector covers the areas of: advising on mining assets and the conversion, acquisition and disposal of mining rights and titles advising on the validity and transferability of mineral rights and the manner in which transactions should be structures to protect mineral rights opinion work in a transactional and day-day context on the Mining Charter, how it fits with the Board-based Black Economic Empowerment Act, the BEE Codes of Good Practice, and how the Department of Mineral Resources approaches BEE.


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