DUNCAN WANBLAD: Mining can help SA build a new, clean and inclusive economy

The history of human development is fundamentally a history of energy and economic transitions in tandem. With each stage of economic development countries experience a transition that is characterised by a shift from one primary energy source to another. As a result, when economies develop and become more complex energy needs increase significantly — and so do society’s expectations.

This is where we stand now: the global imperative to limit further global warming by targeting carbon neutrality has spurred a transformational shift away from fossil fuels towards clean energy sources. And while we know momentum is building to shift to renewable energy, defining how we do this in a way that leaves no-one in society behind is crucial. In this regard I believe the mining industry can play a leading role in building a more collaborative and inclusive economy that places people and the principle of shared prosperity at the heart of development.

I grew up during a time of significant industrialisation in SA. The development of the country’s telecommunications, rail, ports and other forms of infrastructure all relied on affordable and abundant carbon-based energy supply. Off the back of this, new industries sprang up, providing economic opportunity and growth that formed the backbone of SA’s economy, which remains the most advanced economy on this continent. But this growth, as we all know, was exclusionary and divisive and left too many people behind while sharing prosperity only among a select few.

The energy transition Anglo American is working on now presents an opportunity for SA to build a new, clean and inclusive energy ecosystem that can create significant new economic opportunities for this great country and, indeed, the region of Southern Africa, and truly transform the way wealth is created and shared in it. With its vast natural reserves of abundant sun and wind, SA — and the rest of the region — provide an unmissable opportunity to decarbonise and create significant new economic sectors. We at Anglo American are busy on precisely that path.

Groundbreaking partnership

If the last two years have taught us all anything, it is about the power of partnership, of working together to achieve extraordinary outcomes, and it is here that I believe that our industry — and other industries — can pool our expertise with government to build greater capacity and resilience in the public sector. Policy support, regulatory certainty and robust state institutions are essential to this — as is upholding the rule of law, preserving the safety and security of all residents, and rooting out corruption.

In March we announced a groundbreaking partnership with EDF Renewables — a global leader in renewable energy — to work together towards developing a regional renewable energy ecosystem in SA to provide 100% of our energy requirements through renewables: between three and five gigawatts of new capacity. This ecosystem will involve the construction of on-site photovoltaic (PV) plants and off-site wind farms — helping us reduce our Scope 2 emissions and providing the foundation for green hydrogen production — to power our haul trucks and beyond.

We see this ecosystem being more than just about energy. A wide range of new economic opportunities can be generated, but to ensure this value is created and shared inclusively we must consider how to use the transition as a springboard for unlocking a nation’s growth and development potential. Over the coming decade the capability to innovate and bring innovation to the market will be a crucial determinant of the global competitiveness of industries such as mining and nations like SA.

To that end SA and many other mining jurisdictions on the African continent have an opportunity to position themselves for this coming era and then harness the considerable benefits that it will bring. That time is now, and it requires forward-thinking regulatory frameworks that support innovation, allow the rapid development and adoption of new technology, and incentivise exploration for the minerals that will build the economy of the future.

Everyone’s industry

To paint the picture more vividly: delivering a pathway to limit global warming by two degrees will require almost $2-trillion in capital over the next 15 years. This is new capital that will have to be invested in finding and bringing to market the green metals and minerals that are abundant in many parts of this continent. The people of SA and Southern Africa will rightly expect us not to miss this era-defining opportunity for their countries to play their part.

By transforming ourselves as an industry we are setting up the foundations for a new economy, and the African continent will play a leading role in this. Coming from a country with a deep mining heritage, I have often been inspired by how widespread the benefits of mining are shared, compared with pretty much any other industry. Simply put: mining is everyone’s industry. This is an industry at the very heart of modern life, an industry that is helping build a new economy to save our planet for 8-billion people who depend on our metals and minerals every day — without realising it.

As the world decarbonises we recognise that this moment is not only about the role of mined products in the energy transition — but this moment is also about how we lead the way in helping develop new models of shared prosperity as part of what must be a just transition. The burden of expectation is upon us to do so responsibly, considering the full breadth of our stakeholder universe and recognising that stakeholder value takes many forms and is very much in the eye of the beholder.

Mining is not just a “part” or a “cog” of the future of the global economy and the planet we all share; it is the bedrock. Let us work with greater urgency to help build this future together.

• Wanblad is CEO of Anglo American.