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Namibian mining at new highs

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Namibian mining at new highs
Gold production benefited from better-than-expected grades from the underground Wolfshag operation at B2Gold’s Otjikoto mine. Image credit: Leon Louw for WhyAfrica

Namibian mining at new highs

Namibia’s 2023 GDP figures highlights the growing importance of the mining industry relative to other sectors.

By Leon Louw, owner of WhyAfrica and editor of the WhyAfrica magazine

Namibia’s mining industry continues its expansion. The contribution of mining to GDP increased to 14.4% in 2023, up from 9% in 2021 and 11.9 % in 2022.

The expansion in mining was primarily driven by the increased production of gold, uranium, and diamonds. In 2023, Namibia achieved record gold and uranium production, reaching 9,800 kilograms and 8,283 tonnes, respectively.

This represents an annual growth of 31% for gold production and 24.5% for total uranium production.

According to Zebra Kasete, the President of the Chamber of Mines of Namibia, gold production benefited from expanded mining and processing capacity at the Navachab mine, as well as better-than-expected grades from the underground Wolfshag operation at B2Gold’s Otjikoto mine. Kasete spoke at the 45th Annual General Meeting of the Chamber of Mines of Namibia yesterday.

“The increase in uranium production resulted from several factors, including reduced production delays caused by better management of water supply disruptions, enhanced efficiency in processing plants at Husab and Rossing, and a positive uranium price environment.

“Despite a slowdown in demand and declining diamond prices, Namibia managed to increase diamond production by 6.3%. This achievement was attributed to expanded mining capacity and successful operational ramp-up efforts by Namdeb and higher production from Debmarine’s offshore operations,” said Kasete.

Bedrock of the economy (Namibian mining at new highs)

Kasete said that his first year of tenure was one during which the mining industry in Namibia showed exceptional growth and has now indeed anchored its position as the bedrock of the Namibian economy along with its rising sister sectors namely, energy and oil and gas,

“The mining industry continues to be alive with opportunity. Notably, this is being supported by an improving uranium market which will unlock the development of uranium mines and further exploration for uranium, a buoyant gold market and the development of Namibia’s third gold mine, along with growing international interest in Namibia’s critical mineral potential to support the green energy transition,” said Kasete.

Despite its remarkable performance, there are crucial legislative matters that stakeholders are keeping an eye on. The pending Minerals Bill, the Mine Closure Framework, and the revised Health & Safety regulations are all important and crucial to support the mining industry’s great potential.

Gold and uranium top performers (Namibian mining at new highs)

The top performing commodities for minerals mined in Namibia were gold and uranium. Year on year, the average gold price increased by 8% from 2022 to 2023, while the uranium price rose from just over USD50/lb in January 2023 to USD90/lb at the end of the year.

The sustained increase in the gold price was driven by safe-haven demand, as uncertainty around global growth persisted in 2023 in a tightening monetary policy environment and increasing geopolitical tensions fuelled by the wars in Ukraine and the Gaza Strip.

The uranium price has steadily been building momentum since 2019 and various analysts have forecast that a full recovery is likely to materialise in 2024.

The World Nuclear Association predicts a cumulative deficit of 150 million pounds until the end of 2040. This imbalance stems from a confluence of factors on both the supply and demand sides.

On the supply front, a prolonged period of depressed uranium prices deterred investment in exploration, resulting in a dearth of new mine developments over the past decade.

Meanwhile, on the demand side, growing governmental support for nuclear power as a stable baseload energy source has instilled confidence in the global uranium demand outlook. Meanwhile, the average prices of copper, zinc, lead and tin recorded year on year declines of 4%, 24%, 1% and 17% respectively.

A vibrant exploration environment (Namibian mining at new highs)

According to Kasete exploration and development chamber members recorded a 18.1% increase in exploration expenditure from 2022 to 2023.

“This growth reflects a vibrant mining exploration environment, particularly for critical minerals, gold, uranium, and copper. Osino Resources, Bannerman, and Reptile Uranium played a pivotal role in driving this increase through their progressive exploration efforts as they position themselves for mine-development.

“Other major players in critical mineral and base metal exploration, such as Craton, Namibia Critical Metals, and Damaran, also contributed to this positive trend. Against this backdrop, the Chamber anticipates a significant increase in exploration interest and investment in the next few years, and with that, growing opportunity for Namibians to participate in these activities.

“The challenge, however, remains for Namibians to effectively raise financing for exploration projects. Namibians need to be empowered with the knowledge and skills on how to raise funds for exploration, enabling them to become active partners and contributors to projects.

“Overcoming this challenge requires collective collaboration between education and finance institutions, MME, and other stakeholders to equip locals with the know-how and skills to successfully raise capital for exploration projects,” said Kasete.

Namibian mining at new highs

Namibian mining at new highs
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Namibian mining at new highs

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