By Leon Louw
Nico Pienaar has been a stalwart for Aspasa and in the quarrying and mining space. We asked him to share some of his thoughts with African Mining.
Nico Pienaar, director of Aspasa. Image credit: ASPASA
Nico, can you please give us a short summary of Aspasa with a specific focus on how it has changed from being an association focusing on quarries and aggregate materials to now incorporating mineral mining as well – please also indicate which other mining sectors are now represented by Aspasa.
When Aspasa was started some 30 years ago, it was a combination of smaller groups in provinces. All of these were put together into one national body, which was then called the Aggregate Sand Producers Association of South Africa (Aspasa).
Over the years, the brand name Aspasa became strong. When considering the change in Aspasa, it was made clear that the acronym should remain, but what can be dropped are the words “Aggregate and Sand Producers”. It became clear that small mines not necessarily operating in the sand and aggregate sectors had a need to make use of Aspasa’s services.
This got Aspasa thinking that the organisation could expand its service into other minerals mined in South Africa. However, sand and aggregate would remain our foundation. Sand and aggregates are the most mined minerals in the world. No infrastructure can be built or developed without these basic materials. However, Aspasa decided to add, amongst others, sand, dimension stone and silica.
Does Aspasa have enough say at the Mineral Council of South Africa, and how does it collaborate with other bodies and association representing junior mining companies and small-scale miners at the Council?
Aspasa is on the Board of the Minerals Council and has been on the Board for 22 years. The directors were asked to also represent smaller associations like the Clay Brick Association and the South African Diamond Producers Body. This sub-committee at the Minerals Council has been established under the name of “Associations Leadership Forum”. There are industry players and even unions that are of the view that Aspasa needs to move away, out of the Minerals Council to play its own game as the Aspasa brand is very strong and viewed as a strong service provider. Whereas the Minerals Council plays a higher-level role, Aspasa provides a more practical and hands-on service, which helps the smaller operations. It is therefore clear that at both levels there are benefits to the industry.
What in your view are the biggest challenges facing small scale mining companies in South Africa today?
The smaller scale mining industry has many challenges. Although it is always assumed that Illegal mining means the theft of precious metals like gold, diamonds, and platinum. This assumption is regrettably not correct as the minerals that Aspasa represents are very hard hit. Aggregate, gravel, sand, clay, and diamonds are seriously affected. The problem is that the regulator does not apply its mind to this problem. Aspasa has pushed this issue to a wide group, but no responses have been seen.
Skills development and the Mining Qualification Authority (MQA) system is not working for small operations. There are very few service providers that are hands-on practical, relevant, or effective. Some service providers are unethical and just want to collect funds but ensure that those trained are fully competent.
It seems anybody who applies for a mining licence, often get given them. Often there is an operation and legal quarry in the area, but then some unknown person or group applies and obtains the ‘licence’. Those who do not get a ‘licence’, just start mining, and do not comply to any rules, while down the road the ‘legally responsible’ operator has to comply with all the laws and regulations. A clear level of discrimination.
The Mining Legislation is South Africa is developed for a ‘general mining’ regime. Big mines have staff and systems, whereas the smaller players cannot keep up and battle to comply. This includes health and safety, environmental and other issues. The regulator’s various regional offices all have different views about laws and different interpretation about their application. Employers with more than one operation finds it difficult keep up with different interpretations. The problem is if the law is not clear, equal and fair, then there is uncertainty and non-compliance.
Nico, the construction sector has been through a horrid four or five years, how has it affected quarries that produce aggregate material and cement? For example, has there been a significant drop in the number of operating quarries in South Africa over the last two years or so? What about cement plants? Do you feel that the current situation will improve soon?
Yes, the construction industry, after the 2011 World Cup had a drop. The building materials industry has had sad and good stories. Some quarries and mines have been affected and with Covid-19, some have been mothballed. The problem is that those who do not make it, was already in a wobbly situation before Covid-19. Other companies are opening and buying the weaker sites. It is clear that where operations have strong and good management teams they survive, where they are weak, they struggle to keep up.
You have extensive experience in dealing with mining operations for many years. What do quarries and mining operations normally get wrong when it comes to environmental compliance and what should they look out for that can cause production interruptions?
Environmental issues have become much more important in the smaller surface mines. Environmental legislation is wide, complicated, not coordinated and often not clearly written. For an operation to know all about the complicated mining legislation, is not viable as the field is complicated and depends on interpretations and views. Most environmentalists do not understand the operation of a small surface mine or quarry. Aspasa has and is developing a new way of handling the environmental impacts to make it easier for managers and operations to handle this complicated field.
Do you agree that mining regulations are ominous for smaller mining companies and new entrants to the sector and why? In your view, what can government do to make it easier for small-scale and new mining companies to operate in South Africa?
Mining legislation, regulations and codes of practices are all very complicated. Most of the legislation is written for big mines, which is not only difficult to implement, but also is costly and cumbersome.
Due to this, many small operations just refuse to comply and often act in an illegal manner. When a smaller operation has to comply, one finds many of them just mining illegally.
Are there any good aspects of South African mining regulations and of the way juniors operate in South Africa that can be duplicated in the rest of Africa?
The South African basic legislation is of a high standard. Not allowing fatalities to occur in mines is an important issue in South African mining. The rest of Africa is not documented, so what happens in some other African countries is not clear. We, as Aspasa, have a health and safety audit system for our members which is viewed as one of the best in the world.
Mining is the backbone of the South African economy. Without mining we are lost as a country. Our government departments and the mining industries employers are very well organised and coordinated. This means that when somebody operates in this industry, they can be assured that it is a well-run industry.
What advice would you give young entrepreneurs that want to start their own mining companies and quarries in South Africa? What are the potential pitfalls and how can they negotiate the difficult circumstances in the country?
To start a mining business in this part of the world is challenging. There has to be a clear market for the minerals you intend mining. Construction materials are not exported like other commodities as the use is at ‘home’. Getting the paperwork and understanding it is something that is often ignored. Purchasing crushers and other machines, plant and equipment is a crucial aspect and of utmost importance, as a quarry is not an easy operation to run. It is always beneficial to partner with somebody that already has experience in the industry.