Statutory reporting and notes to the non-financial statements

 

Economic performance

Local procurement

Group local procurement grew to 53% from 48% in FY2010 with the greatest achievement being at Impala Springs.

Significant assistance from government

In the year under review Implats, through its South African operations and its Sustainable Development Department, undertook to build several schools in its areas of operation and labour sending area. These projects were undertaken with the Department of Education in the various provinces on a Rand-for-Rand contribution basis.

In the year under review the Department of Education contributed a total of R8.5 million towards the construction of the following schools:
  • Mbadong Primary School – Eastern Cape (R3.5 million)
  • Marula Schools – Limpopo (R5 million).

In kind or political donations

Implats abides by its policy of not making political donations, either in kind or directly. For the year under review no such contributions were made by the organisation.

Associations and memberships

Implats is a member of the National Business Initiative (NBI) and the South African Mining Development Association (samda).

Social performance

Safety

COMPLIANCE
Implats has a safety management system guided by OHSAS. All safety reporting is in line with the requirements of the DMR. Following the review of the Mining Charter in 2010, safety and health reporting as part of the social and labour plan as outlined by the Minerals Petroleum and Resources Development Act (MPRDA), Implats has reviewed its reporting procedures to ensure compliance.

EMERGENCY PREPAREDNESS
Implats has emergency teams at all operations that undergo regular training including drills, to manage a range of incidents.

AWARDS
Internal awards

The following shafts received safety awards:
  • Platinum – Ngwarati, Zimplats process, Rukodzi 2A and 2 Shaft – Rustenburg
  • Gold – Refineries, Mimosa, Zimplats
  • Silver – SA processing, Bimha, opencast (Zimplats)
  • Bronze – 8, 5, 7, and 6 Shaft – Rustenburg

Health

HEAT STRESS
Heat stress remains a potential occupational health risk in certain occupations. The process of testing and controls to ensure employees are able to work in hot environments is very well controlled, however, and no cases of heat exhaustion or heat stress were diagnosed during the year.

Cholera and malaria
Following the cholera epidemic in Zimbabwe in early 2009, Zimplats continued its extensive education campaign and, where necessary, provided medication and treated water to employees and their families. These measures have successfully contained the number of infections at our operations.

Implats provides ongoing malaria education, advisory services and prophylaxis for employees who travel to malaria areas.

Following the identification of the anopheles mosquito larva at Zimplats, this region is now being treated as a malaria area. Employee and community education, spraying and mosquito surveillance and monitoring are in place.

A total of 52 cases were diagnosed in FY2011 (FY2010: 35).

Swine flu
No cases of swine flu were reported in the year under review.

People

COMPLIANCE
Implats complies fully with all legislation governing the mining industry and reports annually to the Department of Mineral Resources. Through its social and labour plans, it ensures the delivery of empowerment projects and ensures the achievement of its objectives as dictated by the Mining Charter. Areas of focus are on employment equity, skills development, preferential procurement, enterprise development, housing and living conditions, as well as income-generating projects and infrastructure.

EMPLOYMENT CREATED
As at FY2011 year-end, the Implats Group had 57 127 employees. Of these 39 624 were own employees, while 17 504 were contracted labour. The 11% increase in contracted labour was as a result of project development at our Impala Rustenburg operations, building up to the 1 Moz platinum production beyond 2016.

Due to the historical legacies of migrant labour within South Africa 13,4% of the employees working in our South African operations were sourced from neighbouring countries. While Implats does not discriminate against employees from neighbouring countries, we aim, as much as possible, to employ people from the areas surrounding our operations.

SOCIO-ECONOMIC DEVELOPMENT
Awards

In FY2011 Implats received the Sunday Times: Corporate Social Investment Leadership Award for its contribution to social development through its various SED projects and initiatives.

SIGNIFICANT FINES RELATING TO NON-COMPLIANCE WITH LAWS AND REGULATIONS
No fines were received in the year under review for non-compliance to laws and regulation.

Environment Performance
Compliance
Implats environmental programmes are guided by various legislation both in South Africa and Zimbabwe. In Zimbabwe legal compliance is with respect to laws governing that country on a “polluter pays” principle. Some of our operations are accredited through the ISO14001 Environmental Standard.

AWARDS
Implats was awarded two gold certificates by the National Business Initiative in recognition of our participation in the 2010 Carbon Disclosure Project. The awards were made for a high rating on the Carbon Disclosure Leadership Index (CDLI) and for a Band B (fast following) rating on the Carbon Performance Leadership Index (CPLI).

KEY PRODUCTION STATISTICS AND MATERRIAL CONSUMPTION
Non-renewable raw material consumed include rock mined and milled, slag treated as well as liquid fuels, coal, explosives, oils, grease and grinding medium (steel balls). Timber used by our operations is sourced from sustainable forestry enterprises. Total Group ore milled was 20 794 tonnes, a 3% increase from the previous years. Platinum produced equated to 1,836 oz, a 7% increase from the previous year.

LAND MANAGEMENT, BIODIVERSITY AND REHABILITATION
Closure plans have been developed for all our mining operations. The MPRDA requires the holders of mining licences to annually reassess their environmental liability and amend their financial provision accordingly. The calculation of the closure liability of Implats’ South African mining operations is performed annually by an independent specialist and is based on available rehabilitation fees. The liability estimate is reflected in current monetary terms. Impala is required to align the liability assessment with the DMR’s guideline on closure-related financial provision. This has resulted in the ongoing addition of certain regulatory costing components which were omitted from previous assessments. Improved understanding and quantification of operational environmental impacts and stricter environmental requirements may further influence the liability estimate. The MPRDA’s provisions for mine closure, including financial provision, is only applicable to our South African mining operations and therefore excludes our Zimbabwean and refining operations.

All environmental issues at the Refineries operation are therefore governed by the NEMA which is South Africa’s framework legislation governing environmental issues. Apart from NEMA’s duty of care responsibility, no formal closure plans and financial provision are required.

The Mines and Minerals Act (MMA) and the Environmental Management Act (EMA) govern the Zimbabwean mining operations. The MMA requires an authorised environmental impact assessment (EIA) prior to the commencement of any mining activity. This EIA and the associated remediation of impacts are managed by Zimbabwe’s Environmental Management Agency. The requirement of approved closure plans is also contained within the EIA process. The only requirement on financial provision is currently contained under Statutory Instrument (SI) 6 of 2007: Effluent and solid waste disposal. These regulations state that “fees for financial guarantees for security for complying with environmental conditions for reclamation of mines and mining operations will be based on third-party costs to rehabilitate land that is disturbed as a result of mining operations”. This, however, has not been implemented fully and currently no fees are listed. It is anticipated that in future these fees will be payable into a state-owned fund, and for which Implats has made provision.

Rehabilitation at Impala Rustenburg is undertaken concurrently with all opencast mining activities with a total of 40.2ha rehabilitated during FY2011. Impala has initiated a project to assist in evaluating the status and success of its rehabilitation programme. Landscape functionality is assessed and used as a basis from which rehabilitated areas are signed off.

All opencast mining operations at Zimplats ceased towards the end of 2008. A rehabilitation programme was subsequently developed and formally implemented in January 2011. The programme is aimed at backfilling the voids with waste rock, sloping to a maximum of 18° and re-establishing indigenous grass and tree species. This project is expected to be completed in 2016 at an estimated cost of US$7.9 million.

In FY2009, Impala Springs decommissioned the enhanced evaporation spray system it had used since the early 1990s as part of its effluent treatment facilities. The site is now being rehabilitated using phytoremediation (vegetation) techniques. Once root systems are established, the trees begin to extract pollutants from the soil, storing these in their leaves. For the first few years, it will be necessary to harvest the leaves until the soil has been sufficiently cleansed. The main purpose of the first phase is to stabilise the soil pH by extracting the salts from the ground. After this initial period, more trees will be introduced to assist with metal uptake from the soil.

Group rehabilitation provisions and liabilities are indicated in the table overleaf.

Tailings dam management
During the process of mining, significant amounts of ore (minerals-bearing material) are brought to the surface and processed to extract the precious metals. Waste rock and tailings (the slurry left behind when the minerals concentrate is sent on for further processing), are deposited on surface in waste rock dumps and tailings dams, respectively. Implats uses on-land impoundments for the disposal of tailings, called tailings storage facilities (TSFs). Comprehensive controls are in place to contain and collect all decanted water from these TSFs and to re-use this water in our processing facilities.

The safe management of tailings dams is a specialist task and is typically contracted to civil engineering and environmental consultants. Very specific plans are in place for their design, construction, operation, monitoring and closure.

A TSF guideline document was also compiled in FY2011. This will aid with the life cycle management of the TSF and ensure environmental and operational sustainability.

Given their high salt concentrations, these TSFs are a potential source of ground and surface water contamination. Programmes are in place to minimise this impact, including landscaping and vegetation, appropriate to the area of operation and designated land use. As far as possible, rehabilitation takes place concurrently with tailings deposition processes. At Impala Rustenburg woodchips and sewage sludge from our operations are collected and used by a community-based business to make compost. The compost is then used in the process of rehabilitating tailings dam slopes.

As with the opencast operations LFA has also been introduced to assess the tailings rehabilitation programme.

Biodiversity management
All prospecting, mining, processing and refining activities are subject to environmental impact assessments (EIAs) and ecological impact assessments before any activity may begin.

Biodiversity is considered in each operation’s EMP and is managed as an integral part of each operation’s EMS. Formal Biodiversity Management plans have been compiled for both the Rustenburg and Marula operations. The primary aim of these plans is to identify any species and habitats that are at risk and to implement mitigation measures to protect and restore biological systems within the mining operations. Mimosa, which is not in a protected area of high-biodiversity value, has a resource conservation plan that focuses on wildlife habitats protection and flora conservation. Impala Refineries is a corporate trustee of the Blesbokspruit Environmental Centre. Blesbokspruit Environmental Centre, which is located near a wetland site, provides environmental education to schools and communities.

Other than Zimplats’ Ngezi Mine, which partially extends into a national park, none of the Group’s operations are in protected areas.

Biodiversity Management reports provide quantitative and spatial data which will be used to compile systematic conservation plans where required. For the Rustenburg operations, six core conservation areas are proposed, based on the identified red data-listed species and sites with above average species richness. These areas also correlate well with the hot spots of species richness for the different organism groups. Implementation of management strategies will commence in FY2012.

Development of a Heritage Resources Management Plan was initiated in January 2011 for the Rustenburg operations and the project is expected to be completed during FY2012. A Heritage Management Plan was also completed for Marula and action plans are being implemented.

Both the biodiversity and heritage management plans at the Rustenburg operations will be managed through a central Geographic Information System (GIS) which was developed and implemented during FY2011.

This approach is in line with the Group’s intention of becoming more involved in biodiversity offset programmes to mitigate long-term harm to the environment.

Waste management
Dramatic changes to the waste management legislation in South Africa took place with the promulgation of NEMWA in July 2009. Subsequently, various draft regulations have been published and are expected to the formally implemented in FY2012. The regulations will require waste management activities to be licensed.

All our South African operations have identified their various waste management activities and licensing of these activities has commenced. We plan, if possible, to have completed the licensing of all these activities within FY2012.

Rustenburg operations and Springs refineries have both commenced with the EIA processes to obtain the required waste licences, in line with NEMWA.

NEMWA requires Implats’ South African operations to demonstrate that it complies with its waste hierarchy requirements. Updates of the waste inventories have been completed at Rustenburg, Springs and Marula and they have been aligned with the newly proposed waste categorisation proposed by government. These inventories will form the basis of long-term waste management plans which we expect to implement at these operations over the next few years. These plans will focus on reducing waste and increasing recycling activities.

The Group is developing a waste management strategy which will set the approach for waste management at a Group level. Implats adopted a strategy of total waste management as a long-term solution to the waste management problem, with the establishment of a new central salvage yard at our Rustenburg operations as a first step. This will provide our Rustenburg operations with a central facility from which they can manage their waste streams. Formal design plans are being drawn up for the yard and we will apply for a licence in accordance with NEMWA’s licensing requirements. Formal design plans have been compiled and will be submitted as part of the waste licences application initiated in FY2011.

To ensure that Impala’s liability in terms of waste handling and disposal is clearly identified, various waste audits were conducted on our current waste contractors. These audits, aimed at ensuring that Impala’s waste is handled in an environmentally acceptable and responsible manner, will continue in FY2012.

Internal and external reporting requirements for waste management are becoming more stringent. A centralised waste management facility at the Rustenburg operation will facilitate accurate and consistent recording and reporting of waste volumes.

The centralised salvage facility will also form the platform from which our implementation of the SAP waste management module can be resumed. While the implementation of the system has seen many delays over the past few years, it has been successfully implemented at our Rustenburg landfill site, where all volumes are recorded in real time onto SAP. This has provided easier and quicker access to waste volumes. The system also forms the basis of reporting onto the Department of Environmental Affairs’ (DEA) Waste Information System (WIS).

At Impala Rustenburg, an external specialist company is contracted to salvage, reclaim, sort and recycle waste and final collection and transportation of hazardous waste is carried out by a waste contractor. Due to the special requirements for handling and disposal of medical waste, all medical waste generated by Impala Medical Services is collected, treated and disposed of by a specialist external contractor.

Impala Rustenburg operates its own permitted general landfill site, managed by an external landfill operator, giving Impala Rustenburg operations full control over its general waste and allowing further recycling to be conducted at the disposal site. Current discussions with the Royal Bafokeng Nation will see this site made available for waste disposal from the surrounding villages.

Impala Springs has a holistic effluent management programme in place and is a zero effluent site. The refinery generates three major waste streams: salt from the precious metals refinery crystalliser, boiler ash and jarosite, both from the base metals refinery. These are disposed of in appropriately registered landfills. Crystalliser salts and jarosite are currently deposited at a permitted hazardous landfill and boiler ash is recycled for brick-making.

Marula’s waste inventory has also been updated and action plans are in place to ensure compliance with the waste hierarchy requirements of the new legislation.

An issue of concern in Zimbabwe is that currently there is no permitted hazardous landfill site, so operations in Zimbabwe have no option but to accumulate hazardous waste or to export it. Implats has facilitated discussions between government and service providers and we hope to find a practical solution to this issue in the near future.

Mimosa is implementing an alternative method of analysing ore which does not generate lead laden cupels which is the main hazardous waste stream. Other hydrocarbon contaminated waste is being incinerated.

SIGNFICANT FINES FOR NON-COMPLIANCE TO ENVIRONMENTAL LAWS
In the year under review, no significant fines were received for breach or non-compliance in relation to environmental regulations.