Privately owned diversified miner, Menar Group, wants to become more involved in beneficiation after its acquisition of South32's Metalloys manganese alloy smelter complex in Meyerton, Gauteng.
Waheed Sulaiman, Menar head of special projects, said the acquisition was an opportunity to help in the re-industrialisation of a region that already has good logistics and power infrastructure.
“This acquisition gives us significant options in the manganese space to potentially process third-party manganese ore and our own product. This aligns with the group’s aspirations to develop a vertically integrated manganese business.
“Despite being the world’s biggest supplier of raw manganese ore, South Africa’s capacity to beneficiate has drastically decreased over the past two decades, mainly due to escalating electricity costs and electricity supply disruptions,” Sulaiman said.
“The deal was finalised last month, paving the way for Khwelamet, jointly owned by Menar Capital and Ntiso Investment Holdings, to take over Metalloys, which is involved in refining and smelting ferromanganese.
Late last year, the Competition Tribunal approved the proposed merger subject to conditions relating to employment and rehabilitation of Metalloys.
Sulaiman said Menar had committed to employ at least 30 people in the next few years. “Growth initiatives and options are being studied, which may result in additional employment opportunities,” he said.
Menar will inject about R1.8bn to revive Metalloys, which was last in production in 2020 and placed in care and maintenance amid high power costs.
Sulaiman said they were exploring multiple options to ensure the availability of sufficient uninterrupted power at competitive prices to support operations.
“The manufacturing options under consideration include utilising existing electric arc furnaces on-site or building new advanced technology blast furnaces. We are also exploring the potential of applying innovative technology to the existing electric arc furnaces, which would dramatically reduce electricity consumption.”
Our government has spoken a lot about the need for beneficiation of local minerals to add value and create jobs. Khwelamet is an opportunity to make a contribution in this regard
— Waheed Sulaiman, Menar head of special projects
Menar hopes the revival of the smelter under the Khwelamet brand will create the opportunity to replenish lost production capacity while taking advantage of locally sourced manganese ore. It also aims to potentially generate electricity, which could be used within the group or supplied to third parties.
“Our government has spoken a lot about the need for beneficiation of local minerals to add value and create jobs. Khwelamet is an opportunity to make a contribution in this regard,” Sulaiman said.
The group aims to produce approximately 250,000 tons of ferromanganese alloy a year in the long term.
“However, restoring the complex to full swing production will take place over time, once refurbishments and other measures have been fulfilled. Our immediate priority is to ensure the site remains safe and compliant with our licence conditions,” it said.
Metalloys was part of Samancor, which is 60% held by South32 and 40% held by Anglo American.
Sulaiman said although manganese prices have been depressed this year, they expect future growth in the market, driven by demand in the steelmaking industry and batteries used for EVs.
“South Africa is well-positioned to capitalise on this vibrant sector due to the country’s vast manganese reserves. Over 70% of the world's identified manganese reserves are in South Africa, primarily concentrated in the Northern Cape province,” he said.
A previous takeover bid by Satka Investments fell through in 2022 after the company failed to meet conditions.
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