Case Study:

Coal production and export from South Africa

Key Issues

The purpose of this case study is to investigate the link between the UK consumption of coal with biodiversity in its main import partner country, and assess the robustness of the evidence.

In recent years, South Africa has become the largest exporter of coal to the UK and evidence suggests that this trend will continue. Coal mining is concentrated in one specific area in South Africa, in the Highveld region in western Mpumalanga, in close proximity to biodiversity sensitive areas. These areas are under significant threat, and although coal mining is not the main activity responsible for this threat, it does certainly have a negative impact. South Africa has been proactive in recent years towards protecting biodiversity, but there is yet more to be done.

Generalisation of these case study findings to other mining countries is not simple, since impacts of mining on biodiversity depend on factors that might vary across countries, such as mining method, legislation and geology.

Introduction

In 2003, the UK accounted for 1.3% of world coal consumption[1]. In 2004 the UK produced 25.1 million tonnes and imported another 36.2 million tonnes, of which 10.1 million tonnes came from South Africa[2]. UK coal exports account for less than a million tonnes per year.

Table 1: Coal imports to the UK by country of origin, 2004

Export Country / Quantity (Million tonnes) / Share of volume of imports to UK in 2004 (%)
South Africa / 10.1 / 28.1
Russian Federation / 9.9 / 27.5
Australia / 6.2 / 17.1
Colombia / 3.6 / 10.0
USA / 2.1 / 5.7
Indonesia / 1.5 / 4.0
Poland / 1.2 / 3.3
Canada / 0.7 / 2.0
Others / 0.8 / 2.2
Total / 36.2 / 100.0

Source: COMTRADE.

Australia has been a major exporter of coal to the UK since 1995. South Africa has emerged as one of the top three exporters since 2000 and was the principal one in 2004. Several changes occurred in South Africa that enabled its consolidation as a leading world supplier of minerals and mineral products: the democratisation of the country in 1994; the subsequent restructuring of the economy which has increased the participation of the private sector and attracted investment; and the corporate restructuring of the mining industry including consolidation of ownership are among the key ones. Evidence suggests that South Africa will continue to have a significant role in this market.

Mining is South Africa’s major industry sector. The country is heavily reliant on coal as a source of energy where more than 90% of generated electricity comes from coal-fired power stations[3]. The following table shows South Africa’s world share and rank of coal reserves, production and exports in 2004.

Table 2: South Africa’s world position in the coal market, 2004

Coal / Quantity (Million tonnes) / World share (%) / World rank
Reserves / 28,599 / 6.0 / 6
Production / 242.8 / 5.2 / 5
Exports / 67.9 / 9.0 / 4

Source: SA Department of Minerals and Energy, South Africa’s Mineral Industry 2004-2005.

Note: Run of mine (ROM) production was 307.0 million tonnes, of which 242.8 where of saleable quality.

South Africa exports around 30.0% of its total coal production, of which Europe is the prime destination with a share of around 90.0%[4]. In 2004, South Africa exported to the UK 4.2% of its saleable production (the second largest importer of South African Coal after the Netherlands). In the period 1980-2000 coal production and exports grew at an annual rate of 3.4% and 4.0% respectively[5]. Forecasts to 2025 indicate that South Africa’s coal exports would grow, albeit decreasingly, whilst Europe’s share would be reduced substantially (different sources estimate a share of 71.5% and 51.6% in 2025).

Traceability of supply chain

The supply chain of coal is simple since this mineral requires minor processing. Part of it takes place at the producing country, i.e. washing and separation, and part at the destination country. Export coal is transported to the ports by rail where it is shipped to the UK. Information of coal deals between South African companies and traders is not in the public domain. However, Comtrade reveals that the UK imported around 193,000 tonnes of coal from the Netherlands in 2004 and the Netherlands imported 16.5 million tonnes of coal from South Africa. It is probable that some of this coal came from South Africa.

Coal mining in South Africa

Mining in South Africa is concentrated in the Highveld region in the province of Mpumalanga, contributing to 80.4% of total run-of mine (ROM) production. 56 mines are located there. Within the Highveld region, production is concentrated in the Witbank area, which accounted for nearly more than half of total ROM production in the country. The following table shows production by coalfield province.

Table 3: Coal Production by Province in South Africa, 2004

Coalfield / Province / Quantity (Mt) / Share (%) / No. of mines in province
Witbank / Mpumalanga / 173.0 / 56.3 / -
Highveld / Mpumalanga / 61.0 / 19.9 / 56
Waterberg / Limpopo / 35.0 / 11.4 / 11
Free state / Free State / 23.0 / 7.5 / 2
Ermelo / Mpumalanga / 13.0 / 4.2 / -
Others / KwaZulu-Natal / 2.2 / 0.7 / 4
Total / 307.2 / 100.0 / -

Source: Scott Wilson based on SA Department of Minerals and Energy, South Africa’s Mineral Industry 2004-2005

Figure 1: Coal mining by province in South Africa, 2004

Source: Scott Wilson based on SA Department of Minerals and Energy, South Africa’s Mineral Industry 2004-2005.

Mining is largely controlled by a few major companies. These are: BHP Billion (Ingwe), Anglo Coal, Sasol, Eyesizwe, Kumba Resources and Xstrata (Duiker Group). A change towards democracy during the 1990s has contributed to the current market consolidation. Recently, the promulgation of a socio-economic Empowerment Charter for the mining industry (May 2004) has encouraged the emergence of various small-scale mines. The level of production from these mines is unknown, although it is likely to be minor. Most of these mines are also located in Mpumalanga.

The mined coal goes through a series of processes (beneficiation) before being exported, such as washing and separation to decrease the ash content and consequently increase the calorific value. These take place in preparation plants usually located close to the mines. The coal is then transported by train to the ports from where it is shipped. Richards Bay is the main coal export port, with a capacity of about 70 million tonnes per annum. Other ports are Durban and Maputo (Mozambique), with a smaller capacity of 2 million and 1.8 million ton per annum, respectively.

Witbank is likely to continue to be the predominant coalfield region, since it has not reached its production peak. The current operating mines in this area have a lifetime of approximately 20 years. However, the Waterberg coalfield could see its share of coal production increased, since it has around 50.0% of the country’s remaining coal resources. This coalfield is located further inland, hence rail capacity would need to be developed, which could be detrimental to the environment.

Production in sensitive ecological areas

6.4% of South Africa’s land area is designated as protected (IUCN, 2003), 0.4% as RAMSAR sites and 2.8% as biosphere reserves. There are many other sensitive areas that do not fall under the protected category. Mining activity, with its known significant and sometimes irreversible negative impacts on the environment, poses an increasing threat on the environment. Scott Wilson overlapped the location of the mining areas with key biodiversity sensitive areas as a starting point to the understanding of the extent and significance of such threat.

Scott Wilson Ltd

May 20061

Case Study:

Coal production and export from South Africa

Figure 2: Map to show the coal mining regions in relation to sensitive terrestrial ecological areas

Source: Conservation International (2006), WWF G200 (2006), UNEP-WCMC Database of Protected areas (2006).

Figure 3 Map to show the coal mining regions in relation to sensitive marine and freshwater ecological areas

Source: Conservation International (2006), WWF G200 (2006), UNEP-WCMC Database of Protected areas (2006).

The exercise shows that mining activity takes place in close proximity with the Maputaland-Pondoland-Albany hotspot (27.4 million hectares) (Conservation International) and the Drakensberg Montane Woodlands and Grasslands Global 200 Ecoregion (20.2 million hectares), both of which extend along the east coast of southern Africa.

Although these areas overlap with parts of Mpumalanga, the mining areas are located in the Highveld region, to the west of the province. The most biodiverse areas are in the Escarpement (central) and Lowveld (east) where there is no significant mining. However, infrastructure requirements for accessing the mine and transporting the coal to the ports and the extraction and disposal of water from mine operations do have an impact on this area. Furthermore, these biodiversity sensitive areas have suffered from conversion to agriculture, which might have happened in part as a response to the inability to locate this activity in the mining areas and a lack of control and protected areas within areas of rich biodiversity. This is even more plausible since deep soils, such as those were mining is located, tend to have higher agricultural potential than shallow soils[6].

There are also various World Heritage sites (UNESCO) and RAMSAR sites in close proximity to the mining areas. The former are the Greater St. Lucia Wetland Park, the Fossil Hominid sites of Sterkfontein, Swartkrans, Kromdraai and environs, the Drakensberg Park, and the Mapungubwe Cultural landscape. The latter are the Verloren Valei Nature Reserve (Mpumalanga), the Nylsvley Nature Reserve (Limpopo), and the Seekoeivlei Nature Reserve (Free State).

Biodiversity in sensitive ecological areas

The Maputaland-Pondoland-Albany hotspot is floristically, climatologically and geologically complex. There are at least three clear foci of high endemism. The area’s vegetation is characterized by forests, thickets, bushveld and grasslands, and an extraordinary succulent flora. Around 80.0% of South Africa’s remaining forests fall within this hotspot. These are home to nearly 600 tree species and have the highest tree diversity of any of the world’s temperate forests. Much of the once expansive grasslands and forests inhabited by many of the large mammals are facing increased threats from industrial and local farming and also the expansion of grazing land. Approximately 8.0% of the hotspots’ area, i.e. 2.3 million hectares, is under some form of protection. According to Conservation International, major threats to this area include cultivation, plantation forestry, urbanisation, and titanium extraction on coastal sands.

The Drakensberg Montane Woodlands and Grasslands Global 200 Ecoregion is important for the large numbers of endemic grassland plants and reptiles, including areas of quartzite and dolomite rock in the north western section. It is also famous for the restoration of the southern white rhino, living in one of the largest game parks in South Africa. The area provides a habitat for reptiles found nowhere else in the world. About 32 to 45% of this ecoregion has been converted from natural vegetation to other land cover types. The conservation status is very limited, with less than 1% of the grasslands officially protected. Threats to this area include conversion to agriculture, timber extraction, fire, bark-stripping of medicinal trees, soil erosion, cattle-grazing, firewood collection, afforestation with exotic trees, and other invasive plants. The grassland biome is one of southern Africa’s most endangered habitats.

Biodiversity issues are cross cutting and overlap across administrative boundaries. There is more than one government department and different tiers of government overseeing biodiversity issues. Primary responsibility falls under the Department of Environmental Affairs and Tourism (DEAT), but is shared with the Department of Water Affairs and Forestry, the Department of Agriculture and other institutions. Additionally, the South African National Biodiversity Institute (SANBI) was created to focus on all forms of biodiversity. The legislative framework is in place, although further work is required since it is relatively new, and most importantly it needs effective implementation at the provincial and local levels.

Law enforcement and protection in conservation areas is sometimes poor, and the protected area system does not always correspond with the biodiversity of the region. Grasslands, woody grasslands and coastal forests and thickets are underrepresented in the system. Mining activity takes place in areas of wet grasslands that the SANBI classifies as priority, but some activity lies outside these boundaries. The following figure shows these areas.

Figure 4: Priority areas for the South African National Biodiversity Institute (SANBI)

Source: National Biodiversity Institute (SANBI)

In April 2005, DEAT launched the country’s first national spatial biodiversity assessment, undertaken by SANB. This assessment identifies areas in urgent need of protection and makes specific recommendations on how best to link conservation with development. This is an important step, but its success requires a step change in the evaluation of priorities in the policies, plans and actions of a wide range of stakeholders whose core business is not biodiversity. Such changes take time and are influenced by political, economic and social pressures.

Other conservation initiatives include the efforts to establish a protected area linking nature reserves in Swaziland, southern Mozambique and northern KwaZulu-Natal, the establishment of the Baviaanskloof mega reserve, and the expansion of the Greater Addo Park and the Mountain Zebra Reserve. The recently completed Subtropical Thicket Ecosystem Planning (STEP) project produced a conservation plan for the region, with the participation of several stakeholders, which identified priority areas to be considered as new protected areas.

In KwaZulu-Natal a private initiative introduced a conservation programme in 1978, which involved the establishment of committees of landowners who guaranteed the protection of the natural environment or certain natural features. There are now about 218 conservancies covering about 1.5 million hectares (15,000 km²).

Anglo coal has been adopting the practice of keeping the sensitive species that would otherwise be affected by mining operations on a nursery, to return them back to their original habitat once operations are over. This practice has been taking place for the last 2 to 3 years. The operating mines in Mpumalanga have a lifetime of about 20 years from now; hence it is not possible to evaluate the outcome of this practice.

Impacts of coal mining on biodiversity

Coal mining operations are a short-term activity with significant long-term impacts on the environment. These come from all stages of mining activity, i.e. exploration, mine development and exploitation and mineral treatment. The treatment that coal for export goes through is washing[7]. Also, impacts depend on the mining method, i.e. surface or underground mining. In South Africa both methods produce similar amounts of coal.

The impacts of both surface and underground mining can be summarised as follows:

  • Soil erosion, deforestation.
  • Dust and noise pollution: arises as trucks are driven on unsealed roads, through coal crushing and drilling, and wind blowing over mining areas.
  • Surface and ground water pollution: water is contaminated by acid drainage which arises from the exposure of rocks containing minerals with sulphur to air and water. Mining requires the use of large volumes of water.
  • Land use disturbance: particularly from surface mining since it requires larger areas of land to be disturbed. Also, exploration activities which take place over areas larger than the mine itself, although negative impacts are much less significant.
  • Air pollution: from dust, and release of sulphur dioxide, carbon dioxide and methane from coal mining, processing and combustion. Also, from energy consumption for mining operations, some of which requires coal combustion.
  • Consumption of wood for the construction of the mines.
  • The production of waste rock with residual coal as a result of the beneficiation process, which accumulates through time and can potentially ignite.
  • Infrastructure necessary throughout all stages of mining operations to access the site and transport extracted mineral to the ports, such as routes and auxiliary facilities, even more so if mining takes place in remote areas.

There are other indirect impacts, namely, disruption of communities, of their social relationships, organisations, cultures, and livelihoods, and severe impacts on health and quality of life.

Surface mining is carried out by strip or opencast mining. Risks of acid drainage are less with surface mining than with underground mining, since most of the coal is generally extracted and coal measures are usually below the regional water table. Opencast mining, used when geology makes strip mining inappropriate, produces considerable impacts on the environment since it produces large amounts of waste coal. The sulphur compounds can slowly oxidise or ignite, releasing sulphur oxides that can kill the vegetation cover and accelerate soil loss. In addition to this, the acid can permeate by rainwater and pollute ground water.

Underground mining takes place in areas where coal seams are deep. Impacts are significant as methane can be released into the atmosphere. The deeper the mine, the higher the content of this greenhouse gas in the coal. However, mines in South Africa are less deep than mines elsewhere in the world, and, because most of the mines in the country lie below the local groundwater level, once mines are abandoned and fill up with water air cannot reach the coal and so the greenhouse gas is not released. Mines in the KwaZulu-Natal province lie above the local groundwater level and so significant acid drainage is generated from sulphur oxidation. However, these mines are relatively small and have a minor share in total coal production in the country. Underground mining can be done by room-and-pillar or longwall methods. When longwall mining is used, the roofs are allowed to collapse behind the mined-out area, resulting in the reduction of ground surface levels (subsidence) which can alter the drainage. Also, the remaining coal can heat and ignite. However, longwall mining represents just 6.0% of underground mining.