FOREWORD BY VUSLAT BAYOGLU

Md Menar

Four factors could have a major impact on mineral resources in 2023. The first is geopolitics. The ongoing Russia-Ukraine war and the détente between Australia and China will determine trade in commodity prices. While the West’s continued support of Ukraine will continue to exert restrictions on Russia’s fuel exports, the thawing of Australia-China relations will boost trade between the two. The war may keep the prices of commodities such as thermal coal and anthracite high. Australian coal producers could see more of their products back into China, which is continuously improving its energy security by building more coal-fired power plants.

The International Energy Agency expects coal demand to increase. The shortage of gas and its increasing cost are among the reasons for the ongoing reliance on coal in Europe. The impact of the thawing of relations between Australia and China will likely go beyond coal exports. It could lead to increased exports of iron ore and manganese from Australia to China. This means South African products will be subject to more competition by Australia, whose iron ore and manganese market share in China was under threat during the political tension.

The second factor is China’s relaxation of its zero-Covid policy. As China ends lockdowns, economic activity is expected to rise. The world’s second-largest economy and largest importer of minerals will most likely increase its orders and manufacturing output. China’s expected rebound will drive demand for resources such as coal, manganese, iron ore, chrome, and PGMs.

The third factor is the state of logistics and their impact on supply chains. In the immediate aftermath of the Covid-19 peak, global logistics bottlenecks proved to be a major contributor to price spikes and constrained economic recovery. However, there have since been improvements globally as trade normalises. However, the situation is different in South Africa as Transnet, the state-owned logistics firm, continues to battle challenges unrelated to Covid. The capacity constraints linked to the legacy of procurement irregularities have slowed exports. But the government’s policy to liberalise rail and ports by providing access to third parties might turn the company’s fortunes and South Africa’s economy. Lastly, the ongoing renewables versus energy security debate will have a major impact on commodities. As the pressure to decarbonise grows, the prices of minerals required for battery storage will continue to rise. There is already a global race by manufacturers to own the value chain of some key minerals — from rare earths to lithium. While this race continues, the negative rhetoric on coal will drive down investment in coal mining despite the reality that it is still a required fuel in many economic jurisdictions. Lack of investment will result in the upward trajectory of the coal prices, especially if Russia remains locked in the war with Ukraine.

David

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RAIN MAKERS & POT STIRRERS

Jakob

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President And Ceo

Asante

Gold Corporation

www.asantegold.com

ASANTE Gold Corporation has kept a breakneck pace since early 2021, establishing itself as a mid-tier gold producer, focused on Ghana. In that year it bought Bibiani from Resolute Mining in a deal valued at $90m. A $30m final instalment was paid in November. Then in April last year it announced an agreement to buy the Chirano gold mine from Kinross Gold in a $225m cash and shares deal. Combined, the transactions put Asante Gold on course for roughly 340,000 ounces a year in gold production. Anthony thinks the company will establish a 400,000 oz/year run rate this year. By way of financing, Asante agreed a $140m financing package involving forward sales with institutions in Ghana. Clearly, there’s a close affiliation with the West African country, especially as 44% of its share capital is held by local institutions. Middle East investors Emiral Resources, a Dubai-headquartered investment company, and Fujairah Holdings, named after the city in the United Arab Emirates, hold 13.8% and 11% of Asante Gold respectively. Kinross Gold also has an 8% stake in the firm in part consideration for Chirano. Gold production starts to tail off from about 2025 so it’s quite likely Asante will be driving more deals in the near future, or looking for organic growth. Regarding the latter, the company is running a technical study over the proposed $117m Kubi Gold prospect located south of AngloGold Ashanti’s Obuasi. In October, Anthony listed Asante Gold on the Toronto Venture Exchange, adding to the firm’s Frankfurt and Ghana listings.

Life Of David

A mining veteran of more than 40 years, David Anthony is a miner with a capital ‘M’. His most prominent position prior to Asante Gold was as head of operations for African Barrick, subsequently renamed Acacia Mining, which ran the Bulyanhulu and North Mara mines in Tanzania. He was also COO for West African gold exploration firm Cardinal Resources, which developed the Namdini mine. The company eventually attracted a $500m buyout by China’s Shandong. Anthony also has experience in South America working in Ecuador, Brazil, Chile and Argentina. He is a mining engineer with a BSc from Queen’s University in Ontario.