Modern Mining September 2020

COAL

demand will get tight, and South African producers have to compete harder in a global market to position their export volumes (or even increase the share of export coal to mitigate potential reductions in local demand). To ensure they can stay in business, technol- ogy is the key to unlocking cost competitiveness for South African coal mining, and the industry should proactively look at opportunities for modernising investments. Special effort should also be made to bring all stake- holders along in this process, which will be mutually beneficial for all involved. Long-term transition Managing the long-term energy transition is imperative. Möncks proposes three phases of change for South African coal – the now, near future and long term. The “Now”: Major mining companies are divesting from coal assets for various reasons (investor pressure being one of them). The global mining giants don’t see themselves as the best owners anymore, and the challenge is to find new suitable owners for those coal assets that can oper- ate them in a sustainable and responsible manner. “This means that substantial structural and ownership changes will

continue to occur, which opens opportunities for current smaller-scale min- ing companies and specialised investors to take ownership of those coal assets, and potentially also consolidate today’s highly fragmented producer landscape to realise scale effects and allow for a smoother coordination with other stakeholders of the ecosystem,” he says. The “Near Future”: Coal mining companies will most likely face accelerating cost pressure. This means

Coal is the energy source that will enable the long-term transition to renewables in South Africa.

18  MODERN MINING  September 2020