Olebogeng Sentsho, CEO of Simba Mgodi Mining Incubation Fund and the 2019 winner of the Leaders of Tomorrow competition at the Investing in African Mining Indaba discusses some of the challenges and opportunities in African mining.
Olebogeng, what is your view of the African Mining industry in 2020?
There is a lot of mining potential in Africa. A lot is happening in the copper belt of Zambia and the DRC, and there are also amazing developments producing large amounts of tin. In my view the copper belt will be the next hot spot in African mining. But I’m also keeping an eye on Ghana. What is interesting about Ghana is that because of the surge in gold sales, its banking sector has matured and is starting to take off.
This proves the ripple effects of mining. Mining is a catalyst for building an economy. I’m also very excited about the developments a little further north. I’m optimistic; it’s not a rosy picture yet, but it’s certainly a glowing one.
What challenges is the mining industry in Africa likely to face?
African mining is going to suffer because we still insist on sending people underground. The labour force is going to remain the Achilles heel of the African mining industry until mines decide they no longer want to put people’s lives at risk. The minute we make a decision to say: let’s get people out from down there; let’s develop somewhere else where they’ll be safe – the sector will grow. As it stands, I believe the fact that a wage dispute can carry on for five months, cripple an industry and almost completely obliterate a town – Rustenburg in South Africa was on shut down for five months – is not how things should be done. I think we need to start having very serious conversations with labour to say, “how do we get them all out and safe?”
Extraction should never be a job creator. Beneficiation is a job creator. So, let’s now shift to where the actual employment is and where those long-term employment opportunities are. For me, if we could just deal with the labour issue and we could deal with the transfer pricing issue, I think that the sector will start renewing itself.
What would you say makes the African mining different from the rest of the world?
What people don’t know about small scale miners is that they are experts at what they do. If you sit with them for a whole day, they will take you through the entire production process of whatever mineral. There are steps in there that you may not know from the books, simply because they’ve taken the time to study exactly what it is that they are doing, and they’ve taken the time to absorb it. And so generous are they with their knowledge that they will sit you down and school you. For me, you find that nowhere else in the world, where someone will sit you down, someone with nothing to give but knowledge, and is willing to share it with you.
We get the privilege of being able to camp out when we’re exploring and prospecting, so we are sleeping out in those jungles. It’s beautiful and its fun and the people are generous. And you get so much of an education because you realise what the mineral actually means to the people who live in that area. You realise that the story extends beyond money – the story is a legacy and is part of who they are and who they want to become. You realise that African culture and mining is intertwined.
What can mining companies do better in 2020 to improve the general mining environment?
It cannot be that mining companies are still buying products from the Americas, Europe and Asia and ignoring the fact that they need to be creating backward linkages to the countries where they are mining. Host governments need mining companies to create linkages and grow the economies where they are. This issue of having all the inputs manufactured somewhere else retards our mineral economy.
If our mineral economy was allowed to thrive, we’d have much more local content. We’d also have far more young businesses growing up in the mining industry, gaining their experiences in the mining industry and becoming industrialists in the mining industry. That’s not happening because mines choose to close themselves in. We can’t even create proper economic clusters, because we don’t have those factories to support those clusters. I am convinced that the first thing they need to start addressing is to allow African businesses to do business with them on a real level. For me that is pivotal.
We need to see more women in the boardroom and more women of colour. There are too few of them. What I feel is happening is that most mining companies are forgetting that they are in Africa. You cannot be mining on the African continent and not speaking to Africans who understand the economy.
How supportive is the African mining industry of women?
They are trying very hard, but unfortunately, mining is a traditionally masculine industry. It’s masculine because we haven’t yet developed the technology to prioritise skill over strength. Once this technology is developed, it won’t matter if you are a man or a woman in mining, everybody will be able to do everything. Once we change that dynamic with the technology, I think then we’ll level the playing fields. Africa is still very patriarchal, so you’ll find that its progression towards supporting women in mining is going to be slow, but we can help that type of thing along by allowing women to take on leadership roles. I think that once we start recognising the innate capability of women to lead in the industry, we won’t need to support them anymore.
Which minerals are you watching in 2020?
We need to watch those battery minerals very closely because big things are going to happen in that space, and we don’t want to be left out. We want to make sure that we are participating in the value chain. We need to start investing in the research and development now to start manufacturing batteries – components for cell phones across that entire spectrum of producibles and storage minerals – we need to invest in research and development (R&D) so that the minute this industry starts to grow, we are right there following the growth. For me battery minerals are the next frontier, and I think it’s going to happen sooner than we expect.