Kumba Iron Ore is looking for new mining opportunities in the Northern Cape and in the rest of Africa to shore up its dwindling mineral reserves, with the group expecting its peak production to taper off in the next decade.
The group, Africa’s largest iron producer, said in its annual report published on Friday that as peak production tapers off by 2035, the company may face constraints in replacing mineral resources and ore reserves.
“A failure to grow our reserves or develop new operations to maintain our current levels of production beyond the remaining life-of-mine, will undermine our ability to generate long-term value,” it said.
“There may be a potential challenge regarding general affordability and the availability of capital over the next three years.”
According to the report, Kumba’s prized asset, the Sishen mine in the Northern Cape, has a life span of about 16 years remaining to 2040.
In operation since 1953, the mine accounts for 72% of the group’s annual ore production. The company said at the end of the 2024 financial year, Sishen had 3,713 permanent full-time employees and 3,555 full-time mining contractors.
Kumba’s board last approved investment of R7.6bn in ultra-high dense medium separation (UHDMS) technology at Sishen to boost the quality of iron ore and extend the mine’s operational life. This brought the total investment in UHDMS technology to R11.2bn.
Kumba expects its new UHDMS technology to triple the proportion of premium quality ore production at Sishen, taking it to 55% from the current 18%.
“In August, the board approved a proposal to recommence construction of UHDMS processing technology at Sishen, which will enable us to treble the proportion of premium iron ore product from Sishen, reducing our scope 1 and 3 GHG emissions, and creating a new pathway to extend Sishen’s life to 2044,” Kumba said.
The group, run by Mpumi Zikalala, the only woman CEO of a sizable mine in SA, is also exploring other measures to boost its mineral reserves profile.
These include developing alternative technologies to beneficiate low-grade ore, investigating options for downstream beneficiation and exploring new mining opportunities in Northern Cape and elsewhere in Africa, it said.
The company is also forging ahead with its Northern Cape exploration programme “having secured access to explore neighbouring properties close to Kolomela, with the option to take up shareholding in the deposits should the exploration activities prove successful,” the company said.
The company last year completed its Kapstevel South project at Kolomela, delivering its first ore in June 2024.
Kumba last year passed the muster of a large-scale portfolio review undertaken by Anglo American as part of the group’s asset simplification process. The review saw Anglo turn its back on its diamonds, platinum group metals (PGM), nickel and steelmaking coal business.
This is as Anglo focuses its portfolio on copper, premium iron ore and crop nutrients — having fended off two bids last year from the world’s largest mining house BHP, which sought its copper assets.
With Jacob Webster
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