The global demand and security of supply of critical minerals was a key topic of the 2024 Mining Indaba. This was highlighted by the panel discussion held by Norton Rose Fulbright. As the world’s clean energy revolution progresses, critical minerals (such as cobalt, copper, iridium, lithium, manganese, nickel and platinum group metals) used in the production of wind turbine magnets, nuclear reactors, photovoltaics, and electric vehicles batteries are key to the prosperity of the global economy. The demand for these minerals is heightened by the scarcity of availability and the potential for supply chain vulnerabilities is a universal concern.
It is well known that Africa has vast mineral reserves, including certain critical minerals (cobalt, copper, lithium, manganese, nickel and platinum group metals). As such it is clear that further mining exploration has the potential to be a catalyst for economic growth and business opportunity. For emerging players (known as junior miners) in South Africa looking to seize this opportunity, sourcing capital to fund exploration is one of the biggest obstacles to entry and growth in this sector.
To drive exploration and to support junior miners, the Industrial Development Corporation, in partnership with the Department of Mineral Resources and Energy, has established a R400,000,000 junior mining exploration fund. The fund will be deployed in three funding calls in May, August and November of 2024 in tranches of R100,000,000, R150,000,000 and R150,000,000 respectively.
A South African junior miner is eligible to apply for funding if it (i) holds a valid prospecting licence, and (ii) is at least 51% black-owned. A minimum of R5,000,000 and a maximum of R45,000,000 will be disbursed to each grant recipient. Minister Gwede Mantashe indicated that the fund is intended to provide financial support to at least 13 junior miners.