An Outstanding Business
Richards Bay Minerals (RBM) is a world leader in heavy mineral sands extraction and refining; and South Africa's largest mineral sands producer and beneficiation company. Formed in 1976, RBM's growth stimulates employment, infrastructural development, and encourages the uptake of skills within the local workforce.
RBM accounts for a large percentage of KwaZulu-Natal's mining output and about 3.3 per cent of the national mining sector by value of output. The company is also one of the major employers in the province.
Rio Tinto Energy & Minerals chief executive Bold Baatar said "RBM is an outstanding business, South Africa's largest mineral sands producer and, equally importantly, a fully beneficiated metallurgical complex. We not only mine, but produce value-added products for customers around the world. We are proud of the value we create, and retain, in South Africa. This is underscored by our position as KwaZulu Natal's leading taxpayer, paying $79 million in taxes and royalties in 2018 alone."
Rio Tinto holds a 74 per cent stake in RBM and manages the operations. Blue Horizon, a B-BBEE consortium consisting of lead investors and the four host communities, owns a 24 per cent stake, while the remaining two per cent of the shares are held in an employee trust.
RBM currently operates four mines in the Zulti North lease area, a mineral separation plant and smelting facility. The mines produce predominantly rutile, zircon, titania slag, titanium dioxide feedstock and high purity iron. RBM uses a system of ponds and floating dredges to mine the ore body, where heavy valuable minerals such as ilmenite, zircon and rutile are recovered from the sand. The heavy mineral concentrate is then transported to the mineral separation plant.
The Zulti North orebody grade is declining; therefore, Rio Tinto has approved the next stage in the development of RBM through the construction of the Zulti South project. The $463million (Rio Tinto share $343 million) investment will sustain RBM's current capacity and extend mine life.
The Zulti South mine (Phase 1) will underpin RBM's supply of zircon and ilmenite over the life of mine. Construction is scheduled to start in mid-2019, subject to the granting of all necessary permits, with first commercial production expected in late 2021. The investment will be fully self-funded from RBM's cash flows, with no additional debt or recourse to Rio Tinto. The project is expected to deliver an internal rate of return of 24 per cent (Rio Tinto share).
Rio Tinto chief executive Jean-Sebastien Jacques said, "Zulti South is one of the best undeveloped minerals sand deposits in the industry, and will significantly extend RBM's position as a world-class, first-quartile asset. The long-term fundamentals of the market remain strong, and production from Zulti South will commence in time to fill a widening supply gap, ensuring RBM's position as a leader in the sector, and delivering strong returns to our shareholders."
Stewardship
RBM's mission, vision and leadership values, while underscoring principles needed for operational sustainability, are biased toward compassion and care for its people and the natural environments within which it operates. The company believes in stewardship - that is leaving things better than it found them.
Since RBM's operations started, the mining of sand dunes has been followed by a rehabilitation programme. The dune forest at Richards Bay is a narrow, young forest that only occurs on coastal sand dunes and seldom extends further inland than 500 metres from the coastline. It is a rich and diverse melting pot of species and is of special value, not only for the conservation of species, but also for the economic value it provides to society.
In addition, RBM reuses waste gas (CO) from the smelter plant as an energy source in the production process, which reduces greenhouse gas emissions. RBM's goal of social and economic development aims to ensure sustainability of host communities beyond the life of mining. RBM has invested over millions in new roads in local communities and has spent over several millions in a collaborative effort to improve the quality of education in host communities and in the broader region.