Huge Comet Impact brought Wealth

The Witwatersrand gold-producing area in South Africa is underlain by an underground geological formation also known as the Witwatersrand Basin. It lies on the Kaapvaal Craton, and is one of the world’s largest gold placer deposits. This elliptical basin stretches over an arc of roughly 400km traversing across the Free State, North West and Gauteng provinces in South Africa. Gold occurs only along the northern and western margins of this basin, but not in a continuous band.

The basin is covered by younger sedimentary and volcanic rocks such as those making up the Ventersdorp and Karoo Supergroups. The underlying sedimentary rock has been laid down over a period which ended about 2,700 years ago, when widespread faulting resulted in extensive lava flows covering the Witwatersrand Basin.

The gold was embedded in a conglomerate and at first, it was assumed that this was alluvial gold in an old riverbed. It was then found that the conglomerate, or conglomeratic zone, was part of a sedimentary succession. It was traced east and westward for a continuous distance of 50km and became known as the Central Rand Gold Field.

The gold in this basin occurs in the coarse grained conglomerates forming the upper portions of the “Witwatersrand Supergroup” that hosts roughly 7 000m of sedimentation. It is found here in association with uranium, quartz, carbon seams, phyllosilicates and pyrite. The mineralization of the Witwatersrand reefs is extensive and a total of 70 ore minerals, including diamonds, have been documented from the Witwatersrand conglomerates.

After 120 years of mining on the Kaapvaal Craton, operations in this area have reached depths of 4000m. At this depth, the natural rock temperatures reach about 50°C and the virgin vertical rock pressures of the order of 100 MPa provide an indication of the enormity of the challenges and hazards facing mining.

GOLD MINING IN SOUTH AFRICA

The discovery of gold in the late 19th century spawned the development of the city of Johannesburg, Egoli, or the city of gold, and numerous towns around the gold diggings, including Barberton, and Pilgrim’s Rest. In the 20th century the large gold mines on the West Wits line were established, and towns like Carletonville and Klerksdorp became important and busy centres around the world-famous gold mines viz Kloof, Driefontein and Western Deep levels. For many years South Africa was the world’s primary gold producer.

The glory days of the gold sector started waning in the early 21st century, as mines went deeper to find the rich reef patches. At the same time the gold price had dropped significantly from the previous highs, and the global economy hit headwinds, culminating in the global financial crisis in 2008. Although the crisis has eased in many countries, the effects on the South African mining industry have been profound and enduring.

Combined with internal pressures on the gold industry, rising costs and labour demands, the slow-down in the Chinese economy in 2013/2014 has prolonged the pressure on the resource sector. During 2013 South Africa’s contribution to newly-mined global gold supply dropped to 5.3%. It is estimated that some half of the industry is not profitable, or classified as marginal.

Over the past decade the gold mining industry’s contribution to mining GDP in SA has reduced significantly, in line with reduced gold production levels. Since 2012, mineral sales have fallen 40%, however the contribution to South African mineral export income remains significant at 17%.

Employment in the gold sector has continued to decline since the 1980s, with around 120,000 workers currently employed. At the same time productivity has declined and wages have risen. Despite this, gold mining activities remain a mainstay of employment in many communities around the country, and every employee in the gold sector supports between five and 10 other dependents. On the upside every direct job in the mining sector results in two indirect jobs being created elsewhere.

Key facts and figures

Six metals, all of them silvery-white in appearance, make up the suite of platinum group metals (PGMs)
These metals occur together in PGM bearing ore
South Africa’s Bushveld Complex hosts approximately 80% of PGM-bearing ore
PGMs are durable and corrosion-resistant
The primary application for PGMs is in catalytic converters. In 2013 auto catalysts accounted for 34% of gross world demand for platinum, palladium and rhodium combined
PGMs are indispensable in many industrial applications including in computer hard disks, mobile phones and glass, amongst others
In medical applications PGMs are used in the manufacture of anti-cancer drugs, cardiac treatment, implants, dental applications
The durability, quality, and aesthetic appeal of silvery-white platinum and palladium has for centuries contributed to its appeal in jewellery manufacture
China accounts for 50% of the world’s platinum jewellery offtake
Because PGMs are highly recyclable, they are used, rather than consumed

Location map and geology
Location of the Bushveld Complex, South Africa Location of the Bushveld Complex, South Africa

The Bushveld Complex, formed some 2 billion years ago, is found in the northern part of South Africa, and is the world’s largest layered intrusion. This igneous body hosts more than half the work’s platinum group metals, and other associated minerals such as chromium, vanadium and refractory minerals.

The intrusion is divided into four limbs – the northern, southern, eastern and western limbs. The Bushveld Complex is made up of the Rustenburg Layered Suite, the Lebowa Granites and the Rooiberg Felsics. It is underlain by rocks from the Transvaal Supergroup and overlain by Karoo sediments.

The Rustenburg Layered Suite contains mainly mafic rocks and is divided into a number of different zones. The marginal zone is found around the edge of the intrusion, while from the base of the complex up is the Lower Zone, the Critical Zone, the Main Zone and lastly the Upper Zone.

The chromitite seams in the Critical Zone are divided into the lower, the middle and the upper groups (UG), with the LG6, UG1 and UG2 being of greatest economic importance.

The magnetite in the Upper Zone is rich in vanadium.

The Merensky Reef is found between the Critical and the Main Zone, and is rich in Platinum Group Elements (PGEs) – i.e. platinum, palladium, rhodium, iridium, osmium and ruthenium. (source: Wits website)

Platinum in history

The first known occurrence of platinum in an application dates back to 700BC in Egypt, where the metal was used in the Casket of Thebes (a little box decorated with hieroglyphics in gold, silver and an alloy of PGMs).

Much later, in the 1500s in South America, the Spanish Conquistadors found many occurrences of what they termed platina, while they were panning for gold. In Europe, scientists of the day had a difficult time of trying to categorise and find application for the metal, mainly because of its durability and other extraordinary properties. A breakthrough came in the 18th century when a Swedish researcher added arsenic to the metal, but it was only in 1782 that platinum was successfully melted by adding oxygen.

After a further 25 years it became possible to produce platinum commercially using this method, and the metal was used mainly for decorative purposes. With the scientific and technological progress in the enlightenment era, there were breakthroughs in the refining of platinum, followed by the discovery of palladium and rhodium. The catalytic properties of platinum became apparent for the first time, and the first fuel cell was devised in 1842 using platinum electrodes.

In England the collaborative work of Percival Norton Johnson and his apprentice George Matthey gave rise to the eponymous partnership Johnson and Matthey. Their work at the time culminated in perfecting the techniques of separation and refining of PGMs and casting the metal in homogeneous ingots.

At that stage supplies were difficult to source, and came primarily from Colombia, the Urals in Russia and from later discoveries in Canada, which became the world’s largest supplier until the mid 20th century.
Platinum mining in South Africa

In South Africa the discovery of the first platinum nuggets dates back to 1924. The geologist Hans Merensky’s follow-up work resulted in the discovery of two deposits, each around 100 kilometres in length, which became known as the Bushveld Igneous Complex. This discovery started with test work in the area around Mashishing (formerly known as Lydenburg). Based on successive encouraging findings, Merensky approached a circle of friends to raise funds to investigate any payable platinum deposits. He used the farm Maandagshoek as a base and later secured 23 claims, and worked quickly to locate other platinum occurrences in the area. Merensky’s work resulted in the naming of the Merensky reef. In 1925 follow-up work resulted in the identification of the eastern limb of the Bushveld Complex.

The mines on this geological structure have for many years produced more than 75% of the world’s output.

Since World War 2 platinum mine production grew continuously in response to new applications being developed for the metals. A significant new use of platinum was in the petroleum industry, where platinum catalysts were introduced to increase the octane rating of petroleum and to manufacture important primary feedstocks for the growing plastics industry. This was followed in the 1960s by growing demand for platinum jewellery – given its purity, colour, prestige and value.

In the latter half of the 20th century, the platinum sector in South Africa was dominated by Gencor, JCI and Lonrho. Corporate actions eventually saw the mines in these groups housed under Implats, Amplats and Lonmin respectively, the majors in the sector, and responsible for producing up to 80% of the world’s PGM supplies.

The advent of black economic empowerment, and the use-it-or-lose-it approach to minerals rights (envisaged in the MPRDA) led to a shift in the sector, and the growth and rise of smaller platinum companies, including intense interest from foreign investors and operators alike. This legislation coincided with an upswing in PGM demand and prices from 2002 through to 2008, before a global economic depression heralded the end of the glory days in the platinum sector and shut many smaller operators down.