Richards Bay Minerals announces solar power partnership with Voltalia


FIFI PETERS: Let’s get to that really juicy investment, a big investment, major investment, that was announced today by Rio Tinto, the second mining company this week to announce a major move in the renewable energy space that will help power its mines eventually. It is partnering with France’s Voltalia to set up the Bolobedu photovoltaic power plant that will supply up to 300 gigawatt hours annually to the national power grid.

Earlier this week you will remember that Anglo American announced something similar, talking about a renewable investment, also with a company that has French ties here in South Africa.

We’ve got Werner Duvenhage, the managing director of the Richards Bay Minerals mine, which is owned by Rio Tinto, [with us]. Werner, thanks so much for your time. Is this about reducing your dependence on Eskom with the constant power cuts, is it about reducing your environmental footprint, or is it a combination of both?

WERNER DUVENHAGE: Good afternoon, Fifi. I think we can say it’s a bit of both. First of all, it is mainly because we want to reduce our carbon footprint. That was the driving force. But of course there are benefits that come with it, and that will make us less reliant on Eskom as well.

FIFI PETERS: It’s interesting to see the pace of deals that are being announced by your sector right now, just ramping up on your renewables capacity. One has to wonder about the timing and whether it has anything to do with the fact that regulation in the space has become a little more favourable of late.

WERNER DUVENHAGE: Yes. You know, Rio Tinto made some commitments a couple of years ago, last year specifically, around carbon abatement, with very clear targets for 2025, 2030 and beyond. We’ve been working actually for quite a while on getting new renewable projects off the ground and signed off into formal agreements. And it has certainly helped with the regulation changes; that has definitely helped us to expedite this process.

FIFI PETERS: So in terms of getting this particular project off the ground, you do guide that you are set to start with construction next year, it would seem, and that would last about a year. So in terms of the paperwork and regulatory approvals, is that all done and dusted?

WERNER DUVENHAGE: It’s almost done and dusted. That’s why we are not starting this year. There are a few [things] they call the ‘financial flow’ that need to be finalised in the next couple of months. But Voltalia has banks on board, South African banks, that are funding the project and have already approved it. Most of the regulatory approvals are also in place. So not a hundred percent, but very close to it, and everything is in place.

FIFI PETERS: And how much is this all going to cost?

WERNER DUVENHAGE: Well, Voltalia has not announced the cost of the project yet, and hopefully they will do so soon. But what I can tell you is that the rates we will be charged by Voltalia, including the transmission rate or the wheeling agreement rate by Eskom, gives us rates that are lower than the current Eskom rates. So from our perspective it’s even financially a very good outcome.

FIFI PETERS: Talk to us practically about how this is going to work – this 300GW hours annually. Is this all for the Richards Bay Minerals mine?

WERNER DUVENHAGE: It’s all for the Richards Bay Minerals mine, where we consume currently 1.3 terawatts to 1.8 terawatts of power. That’s just a lot of numbers, but about 10% of our carbon footprint will be reduced by this.

And what it means effectively is that this project is in Limpopo, where it will feed into the grid, and those units will be given as a credit to us here in Richards Bay, at the operations.

And then there’s a fee for handling that transfer. So theoretically it’s meant for us, but in practice it’s additional power that goes into the grid, and we take the power from the same [source].

FIFI PETERS: It sounds really interesting. But I’m also interested in a separate topic [that’s] a bit left field from your announcement, but perhaps potentially relevant to your mines right now. The labour situation at Transnet – is this a concern for you, the strike, and particularly if that strike lasts longer than many hope?

WERNER DUVENHAGE: It’s very critical to us and we’ve been monitoring it since early this morning. All our exports go via the port of Richards Bay, which is just on our doorstep, and 95% of our product gets exported. So it’s really, really critical for us, especially keeping in mind that we were sitting with bottlenecks early in the year that really made it difficult for us to get our product exported, and we’ve finally just caught up on that. We are very worried about this situation with Transnet.

FIFI PETERS: Yourselves and Thungela. It would seem, though, Thungela has announced that it is confident that it will be able to mitigate the worst-case scenario.

But Werner, thanks much for your time in taking the questions. Werner Duvenhage is managing director of Richards Bay Minerals.

Source link

Related Articles