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The Power is Still Off in South Africa – the Effects on Mining
Byron W. King, Energy and Oil (“Profiting in an energy driven world…”)
The lights are still not back on in South Africa. This does not bode well for the metals & ores from the mines down there.
The recent news can be found here. But here is how it will effect some specific metal markets….
When South Africa electricity producer Eskom shut off the power, all major South African underground platinum mines closed. Immediately the platinum group metals in shortest supply – platinum and rhodium – experienced record prices as industrial users and speculators panicked over security of supplies.
South Africa controls about 70% of new mine output for these metals. Thus any supply interruption is significant immediately for price terms, and also critical in terms of availability over the medium to long run.
(6 February 2008)
Byron has contributed articles to Energy Bulletin.
South Africa’s mines battle on new low-electricity diet
Africa World News via Earth Times
Johannesburg – A week after they ground to a halt for lack of electricity at an estimated cost of nearly 200 million rand (27 million dollars) a day, South Africa’s mines were struggling on a new, cut-power regimen and warning of job losses. On January 25, production at the country’s biggest gold, diamond and platinum mines screeched to a halt after beleaguered state electricity supplier Eskom warned it could not guarantee their power supply.
After five days with just enough power to undertake essential maintenance work but no production Eskom has been increasing power to the mines over the past three days in 10 per cent increments.
By Friday the mining companies had recovered 90 per cent of their previous power supply – or what now passes for full supply after Eskom ordered them to cut their consumption by 10 per cent – and were ramping up production.
But several companies have warned that they cannot operate as normal without more power, raising fears of job cuts.
(1 February 2008)
South Africa in the premature long emergency
Anonymous via James Howard Kunstler
It began with a few potholes in the roads, the odd interruption to the water supply in the suburbs, a couple of days with strike action preventing the delivery of municipal services – no garbage collection, protest action disrupting the mining industry and picketing & toy toying at shopping malls…It continued over the next couple of years, largely with disregard for the disruptions, a little irritation to daily commercial and home life by the lack of service provision in food, gas, water and power.
In recent months, at the receivables end of the supply chain, there was a little aggravation at the delays, the lack of service, the shortage of a few consumer luxuries in the retail shops…, ‘but hey, what the hell, this is a great country, we cannot fault the lifestyle, the weather…’. For a couple of months, perhaps a year back or so, there seemed little or no reason to change our way of life, our lifestyles…a little further down the road and the disruptions become more frequent, we learn to cope, learn to accept the rising cost of living, gas supply shortages in the Winter of 2007, the intermittent water disruptions, the odd power outage and the potholes. Potholes may well be the singular measure of the calamity we are in or about to face.
…And just as we were wondering how the effect, implications and opinions of an emergency would pan out into daily life, what the tell tail signs would be… it happened, all of this is the short space of about 2-3 weeks, the realization dawns that it has begun, the country is experiencing and living through the beginning of the Long Emergency, rather unexpectedly and certainly too prematurely.
I proffer that the events in South Africa, tragic as they are, as they play themselves out, will give a good indication of the events that the USA and other countries will realize in the years to come as The Long Emergency’ comes to pass.
(4 February 2008)
Jim says that he received the letter from a lady in South Africa, a farmer.
