12 | FRIDAY February 28 2020MINING & MINERALS12 | FRIDAY February 28 2020MINING & MINERALSLiesl VenterShrinking investment is forcing mining companies to look for new ways to structure projects.This is according to Bold Bataar, CEO of Group Energy and Minerals at Rio Tinto, who said the sector was increasingly portrayed as “r i sk y ”.“Our business model is being subjected to scrutiny,” he said, and while money was moving around the world to less risky sectors, the economic slowdown in China, where demand for commodities had dropped, had also played a role.According to Bataar, now more than ever governments in Africa need to deliver stable political environments that are attractive to investors.“ We have to engage and collaborate more effectively with those that host our presence,” said Bataar. “The model we have sought has been one of shared value. In other words, companies like ours create profit which we in turn invest in the country we operate in.”He said across Africa the mining sector had invested heavily in infrastructure, building hospitals, schools, power plants and roads. But, with mining under pressure, it was now time to collectively pool resources so companies operating in the same regions could work in clusters with governments to provide more services and more solutions.“We need to collaborate and integrate our supply chains. The transformational effect of local sourcing and content in the regions around our assets is understood by us all, so why not collaborate more,” he said. “In my home, Mongolia, our operation has 75% local procurement, providing everything from the overalls to the boots.”He said power, water and road were three of the biggest challenges affecting the mining sector.“Reliable and efficient power generation is a pre-requisite for mining and that, inevitably, is capital intensive. Power solutions that are fossil based will become increasingly difficult to finance and fund. The energy and mining sectors are largely intertwined, but the collaboration and coordination between these industries are not.”Bataar said Africa was at a pivotal moment, with a lot of opportunity, but it would require a collective approach, partnerships of shared purpose, to realise them.
INSERT: Companies operating in the same regions could work in clusters with governments to provide more services and more solutions.– Bold Bataar