Our products and markets

Management approach

We systematically address the safety, health and environmental issues relating to our products at all stages of the product life cycle. We have specific measures in place to protect the health and safety of those using or delivering our products. Procedures for assessing product health and safety are addressed during conceptual development, research and development, product certification, manufacturing and production, marketing and promotion, storage, distribution and supply, use and disposal, or recycling.

PGMs – the green metals

PGMs are used in many applications to reduce environmental impacts, including catalysts for refining processes that improve energy efficiency, autocatalysts that reduce harmful emissions such as nitrous oxides and particulates in diesel and gasoline engines. As such, they play a significant role in reducing air pollution by substantially limiting the discharge of these emissions.

A sustainable approach

PGMs are recyclable, which reduces our environmental footprint and augments their supply. The automotive sector is the most efficient recycler of PGMs. A whole industry has been developed to recycle autocatalytic convertors from scrapped vehicles and around 25% of the platinum used in new autocatalytic convertors comes from this source.

Recycling and beneficiation of PGMs are important parts of our product responsibility. Through our association with one of the world’s leading autocatalyst recyclers, Implats is a significant recycler of metals.

We adhere to all the protocols on transporting hazardous materials, including labelling containers with their contents, safe handling and use, and disposal. There were no incidents in this regard during the year. Our detailed product safety protocols are available on the Implats website.

Beneficiation

The South African government recently released a beneficiation strategy, which places greater emphasis on adding value to locally sourced raw material. It provides a platform whereby resource companies can play a facilitative role in the beneficiation strategy.

The strategy identifies several instruments that constitute an enabling environment for beneficiation (policies, legislation, incentives, etc) as well as government’s policy on beneficiation. These include: access to raw materials at developmental prices, infrastructure (access, cost and logistics), limited innovation and more broadly R&D and shortage to mitigate identified binding constraints and leverage on existing national processes, such as the New Growth Path and the National Infrastructure Programme.

It is significant that the strategy seeks to leverage benefit from the combined growth of India and China to the extent that these regions are projected to be three times the size of the OECD countries. Government notes that China has committed to increase investment in South Africa’s beneficiation programme in order to take advantage of the proximity to mineral source of production, as outlined in the Comprehensive Strategic Partnership with South Africa in 2010.

It remains incumbent upon the PGM producers to ensure adequate supply of PGMs to advance local manufacturing/coating. In this regard the PGM industry plays an active and important role in the PGM Beneficiation Committee (PBC), comprising government, business (mining and manufacturing) and labour.

Our strategy aims to provide guidance and facilitate preferential supply and does not focus on active involvement in downstream projects. Implats currently supplies one fifth of our production to manufacturers in South Africa. These are based on normal commercial terms and underpinned by international US Dollar prices.

With demand for PGMs expected to outstrip supply over the long term, technological innovation ensuring greater utility from every ounce of metal available will accelerate. This opens up an opportunity for growth of PGM demand and the ability to create greater value for stakeholders.

• Additional growth in its ounce profile
• Active collaboration with other industry players in fuel cell development in support of the Department of Science and Technology’s hydrogen fuel cell technology by setting up a fuel cell development association for the industry
• Active involvement in the South African Minerals to Metals Research Institute (SAMMRI) a public/private partnership to develop supporting technology and technical skills with the Department of Science and Technology.

Finally, as alluded to previously, our research is uncovering companies at the cutting edge of fuel cell development that are moving the fuel cell agenda forward towards commercial viability. Within this sphere of involvement, we are looking at uncovering latent investment opportunities for Implats that could also meet the requirements for local technology transfer.

Fuel cells review 2011

Driven by environmental legislation to reduce the global carbon footprint and other pollutants as well as curbing fossil fuel dependency, the first phase of fuel cell commercialisation has made its debut.

Fuel cell operation

Whilst many types of fuel cells exist the operational mechanism remains similar. In a fuel cell, electric current is produced via an electrochemical reaction between a source fuel (generally hydrogen rich) and oxygen. In a proton exchange membrane fuel cell, hydrogen is fed into the anode, which passes over a catalyst that enables the hydrogen atoms to be split into electrons and protons. The electrons are channelled through a circuit to produce electricity. The protons pass through the proton exchange membrane. Oxygen (usually from the air) enters the cathode and combines with the hydrogen electrons and protons to form water. Water vapour and heat are released as by-products of the reaction.

Source: http:www.ballard.com 2 June 2011

The reaction in a single fuel cell produces a very low voltage. Therefore many cells are combined into a stack to produce the desired level of electrical power. The electrical power generated via the electrochemical process is captured to enable the movement and functioning of an electrical device.

Fuel cells can provide energy in a variety of everyday applications.
The stationary market includes the provision of power to buildings and telecommunication infrastructure.
Transportation applications include cars, buses, boats and scooters.
Portable applications include power for outdoor activities, military applications and micro-power electronic devices such as laptops, smart phones and digital cameras.

PGMs in fuel cells

Platinum group metals, having excellent resistance to oxidation and high temperature corrosion, remain the most effective catalyst as they provide unique characteristics of durability, power density and efficiency in fuel cells. The electrodes in a fuel cell are generally coated with PGMs allowing the breakdown of the hydrogen atom. Whilst platinum contributes 20% – 40% of the overall fuel cell cost, it is still used in the most commercially successful fuel cells. The high platinum price though, is driving a search for alternatives. Nanotechnology, could assist in reducing the amount of platinum per fuel cell unit, making fuel cells more affordable. The reduction of the overall cost of a fuel cell system as well as hydrogen provision as the main fuel is gaining momentum. Whilst public awareness and incentives for fuel cell adoption is crucial, the focus remains on the development of hydrogen infrastructure and the associated regulations and standards that govern its use alongside existing conventional fuel forecourts.

Performance in FY2011

Only minor customer complaints were received during the year. These were in connection with labelling and packaging of products, which were resolved.

There were no incidents of non-compliance with regulations and voluntary codes concerning health and safety impacts of products and services during their life cycle.

Customer analysis

The PGMs and base metals we produce are sold to various customers in South Africa and around the world. The table included overleaf provides information on Implats’ products and beneficiation. The Group’s regular customers are primarily in Asia, North America, Europe and South Africa. Usually, the countries with whom we choose to trade are selected to limit our credit risk and increase our geographic diversification.

Implats sells to a range of customers, both end users and intermediaries, in the automotive and related industries; industrial, jewellery and chemical sectors. Sales by sector largely reflect the global split in PGM end users. Customers in South Africa and the United States are mostly in the automotive and related sectors while those in Japan and Europe represent the broader industry.

ISO certification

Implats has in place quality management systems for the quality management of processes based on the International Organisation of standardisation ISO 9001 Quality System and ISO 17025 with the exception of the Rustenburg and Marula operations.

We also have in place the ISO 14001 Environmental Management System at various operations. The standards are used to manage our environmental impacts and mitigate any risk related to our processes throughout the value chain.

	Operation		Date of initial   ISO 14001   certification		Most recent audits
	Impala Rustenburg		2003		May 2010
	Impala Springs		2000		April 2011
	Mimosa		2007		April 2011
	Zimplats		2005		December 2010
	Marula				Due in March 2012

	Uses of PGMs
			Platinum		Palladium		Rhodium		Ruthenium		Iridium
	Automotive		Catalyst to control exhaust emissions   Spark plug tips   Oxygen sensors in vehicle on-board diagnostic systems		Catalyst to control exhaust emissions (particularly hydrocarbon control) Oxygen sensors in vehicle on-board diagnostic systems		Catalyst to control exhaust emissions (essential for NOv control)				Alloying agent in spark plug tips
	Chemical		Gauze for catalytic production of nitric acid Process catalyst for producing bulk (PTA) and speciality chemicals (eg silicones)		Catchment gauze to nitric acid production   Process catalysts		Process catalysts, eg acetic acid, oxo alcohols and rubber products   Alloy with platinum in nitric acid production		Process catalysts, eg production of ammonia (Kellogg process)		Process catalysts, eg production of acetic acid (Cativa process)
	Dental		Hardener in dental alloys		Alloying agent				Alloying agent
	Electro-chemical								Coating for anodes in chlorine and caustic soda production   Sodium chlorate production		Coating for anodes in chlorine and caustic soda production   Sodium chlorate production   Coating for electrode – for electro-galvanising of steel strip
	Electronics		Alloy coating for hard disks to improve storage capacity   Thermocouples to monitor temperature in steel, semi-conductor and glass industries		Conductive paste in multi-layer ceramic chip capacitators Conductive tracks of hybrid integrated circuits   Salts for plating processes		Alloyed with platinum in thermocouples		Resistor pastes for hybrid integrated circuits and chip resistors   PMR technology to increase hard disk memory storage		Fabrication of crucibles for growing rare earth and other crystals (lasers and memory chips) Thermocouples
	Glass		Production of LCD glass Bushings for producing glass fibre   Speciality glasses   Glass for TVs, monitors and cathode ray tubes   Glass substrates for hard disks				Alloyed with platinum in producing LCD glass Alloyed with platinum in bushings
	Investment		Small/large bars, coins ETFs (exchange traded funds)		Coins ETFs
	Jewellery		Fabrication		Fabrication   Alloying agent Platinum jewellery   Whitening agent in production of white gold		Electroplating to give jewellery white finish		Alloying agent in platinum jewellery		Alloying agent in platinum jewellery
	Petroleum		Reforming and isomerisation for upgrading octane quality		Hydrocracking to achieve higher yields						Alloyed with platinum in reforming catalysts
	Other		Anti-cancer drugs   Protective coating on turbine blades   Pacemakers and catheters   Control of industrial emissions (volatile organic compounds)   Magnets		Control of industrial emissions (volatile organic compounds)						Alloyed with platinum in pacemakers and catheters
	Fuel cells		Electrode coating in fuel cell stack   Fuel-processing catalyst   Tailgas burner		Tailgas burner		Fuel-processing catalyst		Electrode coating in fuel cell stack

Implats Sustainable Development Report 2011|www.implats.co.za