mintek annual report 2007...5 annual report 2007 mr mzi khumalo, chairman of board. chairman’s...

MINTEK

ANNUAL

REPORT

2007

OUR MANDATEMintek’s mandate is to serve the national interestthrough high-calibre research, development, and technology transfer

that promotes mineral technology, and fosters the establishment and

and products derived from them.

OUR VISIONTo be a global leader in mineral and metallurgical R&D and

technology transfer.

OUR MISSIONTo serve our stakeholders by promoting technology, industrial growth

and human development.

OUR COMPACT• add value to South Africa’s mineral resources;

• expand the country’s mineral technology industries;

• develop the minerals industries in the SADC and throughout Africa;

• support the growth of SMMEs in the minerals sector; and,

annual report 2007annual report 2007

MINTEK

ANNUAL REPORT

2007

CONTENTS

Mintek Mandate, Vision, Mission and Compact..................inside front cover

Highlights 2006 - 2007..........................................................................2

The Mining Value Chain.........................................................................3

Chairman’s Review................................................................................4Board Structure...............................................................................................................4

CEO’s Report.........................................................................................8Management Structure...................................................................................................8

Performance against objectives...........................................................14

Technical Review................................................................................16Gold................................................................................................17

PGMs..............................................................................................20

Ferrous metals..........................................................................................................22

Non-ferrous metals.................................................................................................24

Industrial minerals.................................................................................................28

Quality, Environment and Safety........................................................................29

Commercial Activities..................................................................30Participation in operating companies............................................................31

Mintek business development projects........................................................31

Process control products..............................................................................33

Capital equipment........................................................................................35

South African Reference Materials............................................................35

Minerals Policy and Sustainable Development....................36Mineral Economics and Strategy...............................................................37

Resource-Based Sustainable Development............................................38

Kgabane Jewellery Initiative....................................................................41

People................................................................................42Human Capital Managment..................................................................43

Transformation and Employment Equity................................................43

Black Economic Empowerment (BEE)...............................................44

Participative Approach: Mintek and NUM................................................44

HIV and AIDS..........................................................................................44

Wellness................................................................................44

Diversity.................................................................................................45

SAP and Human Economics...................................................................45

Human Capital Development..................................................................45

Mintek Publications.............................................................48

Financial Statements 2007..................................................51Corporate Governance..............................................................................52

Audit Committee Report..............................................................................55

Directors’ Report.........................................................................................57

Report of the Auditor-General.......................................................................59

Financial statements and notes....................................................................62

Glossary..............................................................inside back cover

Contact details.......................................................inside back cover

annual report 2007 2annual report 2007

HIGHLIGHTS OF

2006-2007

• Independence Platinum agreed to fund a three-year work

technology.

preliminary in vitro

in 2007/08.

®

annual report 20073 annual report 2007

THE MINING VALUE CHAIN

Technologies and services developed by Mintek

Exploration• Geochemical sample analysis;

• Mineral/ore characterisation;

• Artisanal and small-scale mining (ASSM) project evaluation.

Physical separation

• Bulk sample preparation;

•

•

Separation.

Pyrometallurgy• Pelletisation and briquetting;

• Pre-heating and pre-reduction;

• Modelling and simulation;

• SAF control strategy;

• Fluidised bed and condenser technologies;

• High-temperature solid state and phase

Hydrometallurgy and Biotechnology• Atmospheric and pressure leaching;

metals);

• Solvent extraction and ion exchange;

• Electrowinning;

• Process simulation;

• Activated carbon regeneration;

3O

8

recovery;

• Leach circuit control.•

– zinc (PWG to SHG)

• Titanium chlorination technology.

Value addition•

– Catalysis;– Biomedical;– Nanotechnology;

• “Smart” materials and sensors;

• PGM-based superalloys;

• Low-nickel stainless alloys;

General

process mineralogy;

and development;

installation and commissioning;

.

Concentration

Comminution/Flotation

•

• Plant audits;

•

• Control and optimisation strategies.

Mining• ASSM technology;

• Mining inputs economic studies.

annual report 2007 4

Mzi Khumalo

Chairman of the Board

Chairman: Mawenzi

Resources Ltd. and

Metallon Corporation Ltd.

Dr. Paul Jourdan

of Mintek

Abe Mngomezulu

Chief Director: Mineral

Investment and Policy,

Department of Minerals and

Energy

Dr. Nozibele Mjoli

Managing Director:

Hlathi Development

Services

Dr. Frank Crundwell

Consultant:

Crundwell

Management Solutions

Prof. Phuti Ngoepe

Director: Materials

Modelling Centre,

School of Physical

and Mineral Sciences,

University of Limpopo

Gugu Mthethwa

Manager: Acquisitions

Finance Group,

Standard Bank

Ralph Havenstein

CEO: Anglo American

Platinum Corporation Ltd.

Vinogaren Pillay

Executive Director: CSIR

Mining Technology

Mintek Board of Directors

annual report 2007

annual report 20075

Mr Mzi Khumalo,

Chairman of Board.

CHAIRMAN’S REVIEW

I am pleased to report another year of above-average

growth – the second such year in succession - for Mintek’s core

research and development (R&D) business. Total income for the

to R322.02 million, a year-on-year increase of 13.2 per cent, to which the

Science Vote (core funding) contributed 32.4 per cent. Total expenditure

R13.48 million in the sale of an associated company, as well as earned a share

million.

Fuelled by the resources boom, which shows little sign of abating, global

spending on mineral exploration reached a new high estimated at US$7.5 billion

This windfall has seen substantial investment in mineral exploration and

a long time, and have required relatively little exploration investment, but

have required resolution of technical problems, a change in commodity

price, or changes in political environment, to make them commercial

opportunities. Late-stage exploration, which involves a substantial

component of metallurgical test work, has also become increasingly

decision.

The market for minerals technology is strongly dependent on capital

spending in the mining and metals industries. The current strength

of the market is due to the increasing consumption of metals and

the tight supply-and-demand balance. Supply is constrained by

grade (higher-cost) ore bodies and increased environmental and

technological requirements.

During the year under review, Mintek experienced substantial

growth in its activities related to the platinum-group metals

(PGMs), as a result of the continuing high level of interest in new

on the optimisation of gold circuits, cyanide auditing and consulting,

cyanide analyser and LeachStar advanced process control strategy

have been rapidly adopted by industry.


particularly in the areas of PGMs and non-ferrous metals,

has focused on the smaller companies, who do not have the

believe that our ongoing efforts in this regard have made a

considerable contribution to increasing the competitiveness of

of industrial minerals is usually fairly low-intensity, owing to the

relatively small size of the market. However, this year there

was considerable activity in our new diamond characterisation

facility.

Mintek is growing its capacity to lead and support multiple

employment in mining, manufacturing, and agriculture at the local

and rural levels. Substantial growth was experienced in the area

of sustainable development, due to strong support from the DME,

although this activity is expanding rapidly off a low base, and there

must be some caution in future years regarding the potential for

continued increases.

Mintek is playing an increasingly important role in developing the minerals

based organisation, it is important for Mintek to grow sustainably by

the development of future technologies. In this regard, our biggest challenge

is attracting and retaining experienced scientists and engineers in the face of

Mintek also initiated a programme to recruit a small number of highly-skilled,

experienced engineers from overseas.

growth will depend on upgrades to existing technical and pilot-plant infrastructure.

Perhaps the most critical bottleneck in operations is our analytical capacity, which

services the pilot-plant operations as well as external contract work. During the year

but still approximately twice that of preceding years.

annual report 2007

Mr Harold Motaung, and new members Mr Simon Sikhosana, Mr

Mohlomi Ntilane, Ms Lindiwe Mhlabeni, Dr

The current period is a tremendously exciting time to be involved in the

minerals and metals industries. Mintek is well positioned as a premium

provider of services, products, and technology to the minerals industry

worldwide. It has a comprehensive set of strategies that should enable it to

maintain, if not grow, its market share in a highly competitive environment.

both realistic and attainable, and adequate provision has been made to cover

therefore to be secure. Following its strategic R&D framework, Mintek will

continue to invest in long-term applied R&D, contributing to the technologies

of the future to underpin the future competitiveness of our minerals sector and

his contribution to strengthening and growing Mintek into the globally

like to wish him well in his future endeavours.

Mr Mzi Khumalo

7


Dr Paul Jourdan

Dr Roger Paul

Vimlan Govender

Petrus Fusi

annual report 2007

annual report 20079

CEO of Mintek.

Main pic:

An aerial view

of the Mintek

campus.

CEO’S REPORT

As a result of the phenomenal global commodities

boom,

remains a major producer of the world’s most strategic minerals, and

Africa, as well as projects in Zambia and the Democratic Republic of the

have been started around applications for fuel cells and diesel

under our wing, and new projects are planned for the automotive

issues at all levels in South Africa, including participation in the

New Partnership for Africa’s Development (NEPAD) and the African


Dr Paul Jourdan

Dr Roger PaulVimlan Govender Petrus Fusi

Dr Nellie Mutemeri

Agit Singh Muzi Ncgobo

Busi NtuliDr Elma van der

Lingen

Dr Johan Nell

Amanda QuadlingDr Johan Nell as at 31 March 2007

economic growth and development issues around mining and

resources” for United Nations Economic Commission for Africa

where a large number of potential new projects are being

plan was also formulated for the national and international craft

Pics from top

to bottom:

The Atomic Force Micro-

scope.

The bioleach-ing mini-

plant.

Beadmakingfrom recycled

glass.

Samplepreparation.

of granite waste.

annual report 200711

Inc

om

e,

RM

illi

on

Inc

om

ep

er

em

plo

ye

eR

‘00

0income grew from

million in 2006/07,

incurring as income from

the Compact, which I signed with the then Minister of Minerals and

both fundamental and applied research, which has led to a number

Pics from top

to bottom:

Visitors from the Gambian GeologicalSurvey.

Olive spoons made by rural women of South Africa.

Testing precious-metal catalystsfor cleaning up diesel emissions.

A sample of AUROliteTM

gold-basedcatalyst.


success, and plans to scale up the process to a commercial level

the SADC but also in the rest of the African continent and

and products and have provided process development and

assisted NEPAD, UNECA and the AfDB in developing coherent

great potential for creating sustainable livelihoods, it has been our

Science Vote, decentralised divisions into strategic business units (SBUs), and

Our concerted drive towards internal transformation has made the organisation much

more

Pics from top

to bottom:

An industrial CIL gold

plant.

Minfurncarbon-

regeneration furnaces.

Potterymaking.

Trans-formation in the industry.

SSM training at Giyane.


Pics from top

to bottom:

The Biomedical screening laboratory.

APIC jigging technology.

Harold Motaung,new board chairmanand CEO of Anooraq Resources.

Morake Abiel Mngomezulu,the newly appointedCEO of Mintek, as per 1 September 2007.

The Diamond character-isationlaboratory.

Magnesiummetalproduction.

of the Mineral Development Branch at the Department of Minerals and

combines a little focus, a lot of heart, and a pool of talented


Mandate

Financial perspective

annual report 2007

Sources of income 2005/2006 2006/2007

R million Income, R million Target

Ratio of contract/ total income 53.6% 52.4%

PERFORMANCE AGAINST OBJECTIVES

Stakeholder perspective

Critical objective KPA Target Summary Performance results

}


Organisational perspective

Measure 2005/2006 2006/2007

Learning and growth perspective

output

Transformational perspective

Employment equity demographics

annual report 2007


Main pic:

Solvent drying

in the AuTEK

biomedical

screening

laboratory.

TECHNICAL REVIEW

GOLD INDUSTRY

AuTEK – extending the industrial uses of gold

Project AuTEK, the joint R&D initiative between Mintek and the three major

South African gold producers to develop new industrial uses for gold, is now

nanotechnology and biomedical applications.

AuTEK Biomedical

Biomedical research under Project AuTEK, jointly funded by Harmony Gold

and Mintek, focuses on developing new types of metal-based therapeutic

agents, with the emphasis on cancer, malaria, and HIV/AIDS. The past year

in the in-house team. Mintek’s HIV BSL II biomedical laboratory was fully

commissioned, and funding received

from the Technology and Human

Resources for Industry Programme

(THRIP) allowed for the acquisition

of a Nuclear Magnetic Resonance

(NMR) instrument, which will be

commissioned in early 2008. New

development opportunities are being

investigated through networking

and collaborative approaches

to the large pharmaceutical

companies, with the emphasis

on HIV.

More than 170 compounds

have been screened so far for

anti-tumour activity, with 30

per cent showing promising

results. Structure-based

design has resulted in an increase in the “hit rate” (activity plus

selectivity) to 10 per cent. The pharmacological work is largely

undertaken at the universities of Cape Town, Western Cape, and

Pretoria, with synthetic efforts taking place in-house and at three

local universities (Cape Town, Johannesburg, and KwaZulu-

USA for possible assistance with the further development of the

most promising compounds.

Under the HIV programme, more than 100 compounds were

screened in the past year (the majority of them in-house), with an

inhibitor rate of 16 per cent. Advanced studies on 19 interesting

candidates are under way, and it is planned to submit samples to

partners in the USA for further evaluation as a step towards pre-

clinical trials.

Steady progress has also been made in the anti-malarial

programme, which like the cancer programme is also largely

university-based. More than 40 ligands have been prepared, and

“Biomedical research

under Project AuTEK,

jointly funded by Harmony

Gold and Mintek, focuses

on developing new types

of metal-based therapeutic

agents, with the emphasis

on cancer, malaria, and

HIV/AIDS.”


Pics from

top to

bottom:

The

biomedical

laboratory –

preparation

of in vitro

cell assays.

The Atomic

Force

Microscope

in the nano-

technology

centre.

A respirator

canister and

AUROliteTM

gold-based

catalyst.

Evaluating

precious-

metal-based

catalysts

for diesel

exhaust

after-

treatment

applications.

complexation studies are in progress. Initial data from screening

tests are expected in the last quarter of 2007.

To date, the AuTEK biomedical programme has produced two

PhD and three MSc graduates, and a further eight PhD, six MSc,

and four post-doctoral candidates are currently registered. Work

under the programme has won seven awards, and resulted in

100 contributions to professional journals and conferences, with

49 being international.

AuTEK Nanotechnology

The AuTEK nanotechnology programme, which is co-funded by

electrochemistry, molecular recognition (biolabelling), and

drug delivery systems. A novel method has been developed

for producing anisotropic precious-metal nanoparticles, and

further work is being carried out to control product quality, particle

size distribution, and reproducibility with the aim of imparting

desirable electronic, magnetic, optical, and catalytic properties.

Certain systems are being investigated for their possible use in

electrochemical sensors for the detection of glucose and other

biological structures.

The production of organically stabilised gold nanoparticles

for application in molecular recognition (biolabelling) has been

successfully scaled up to 2 litre batches. These will be stabilised and

functionalised by attaching bio-molecules, with the goal of developing

malaria, HIV, and diabetes. Similar technology involving multiplexing of the

underlying structure will be utilised to adapt the particles for drug delivery a

well as diagnostics.

To ensure that South Africa remains internationally competitive in this fast-

ordinated at national level by the Department of Science and Technology (DST)

through its National Nanotechnology Strategy. One of the main pillars of this

initiative is establishing a number of innovation centres around the country. Two

centres will be established in 2007, one at Mintek and the other at the CSIR. The

primary aims of the centre at Mintek are to train young scientists who will stimulate

the growth of an emerging nanotechnology industry in South Africa, develop

prototype products, and add value to the precious metals being produced locally.

The DST, the Medical Research Council, and the Water Research Commission

will be participating in the initiative, which will initially have three focal areas around

sensors, molecular recognition, and nanotechnology for the water industry.

AuTEK Catalysis

The AuTEK catalysis programme, which is co-sponsored by AngloGold Ashanti,

seeks to develop gold catalysts for industrial applications. One of the major hurdles to

establishing a gold catalyst market has been a lack of commercially viable quantities

of material for product testing and screening. Large-scale production of gold catalysts

is not easy, owing to issues such as gold particle size, reproducibility, and deactivation,

and involves synthesis techniques that are completely different to those currently

employed in PGM catalyst production. Research at AuTEK has been directed at

overcoming these hurdles and has led to the development of the AUROliteTM range of

gold catalysts.

Under the AuTEK catalysis programme, the current production capacity of 20 kg

per batch is currently being further scaled-up to the 65 kg scale to meet demand.

Construction of the plant, which is sponsored by the DST’s Precious Metals Initiative, is


Pics from top to

bottom:

AUROliteTM

gold-based

catalyst.

Inspecting

emergency

equipment

during an ICMI

audit of a gold

plant.

Cyanide

speciation by

segmented

analysis.

Calibrating

a Cynoprobe

before

installation on a

gold plant.

expected to be complete by the fourth quarter of 2007.

AuTEK, in conjunction with the World Gold Council (WGC), is

actively marketing these gold-based catalysts under the trademark

AUROliteTM, and supplying end-users. The typical AUROlite

product range includes Au/Al2O3, Au/Fe2O3, Au/TiO2, Au/ZnO. Joint

marketing displays have been held at the North American Catalysts

Conference and Europacat – generating much interest, which has

translated into further orders. AUROlite materials have been supplied to

petrochemicals, oleochemicals, and respirators and other safety equipment.

Gold catalysts are unique in terms of their ability to catalyse oxidation

reactions at low temperature and/or by the use of molecular oxygen.

Examples of such reactions include:

• Carbon monoxide oxidation.

• Oxidation/selective oxidation of organics – e.g. glucose to gluconic acid,

cyclohexane to nylon precursors.

• Epoxidation – e.g. propene to propene oxide.

Gold catalysts have also been found to be suitable for the removal of mercury

from coal power plant emissions, and the hydrodechlorination (destruction) of

ground water pollutants such as trichloroethene.

Gold catalysts also offer the ability to oxidise the carbon monoxide in

hydrogen feedstock for fuel cells, converting it to “inert” carbon dioxide and

thereby preventing degradation of the cell’s performance. Mintek is still

seeking commercial partners to assist in the further development of this

technology, which has been tested at Johnson Matthey’s laboratories

and subsequently trademarked and patented under the name

AUROPureH2TM.

Cyanide services

Mintek took part in full compliance audits of Sasol Polymers’

Sasolburg sodium cyanide plant and of Sasol Infrachem to assess

for compliance with the Producers’ and Transportation codes of the

International Cyanide Management Institute (ICMI). ICMI-based

“gap” audits were also undertaken at the Navachab gold mine in

Namibia and Geita in Tanzania. The audits planned for Iduapriem

and Bibiani in Ghana were re-scheduled, and will now take

place in 2007. Mintek takes the role of technical Expert Auditor

accreditation as Lead Auditor.

At the end of the year under review, the Cyanide Centre

Laboratory underwent an audit in terms of ISO 17025 (Testing

Laboratories), and Mintek expects to achieve full compliance with

this standard in mid-2007.

Mintek has built a solid foundation in soil, solution, and gas-phase

analysis and mass-balancing of cyanide, and is currently looking

at extending this expertise to other metals. As part of this process,

an advance gold-leach reactor is being commissioned that will

enable conditions such as agitation intensity, shear characteristics,

temperature, pressure, pH value, and redox potential to be

carefully monitored and controlled. The pulp can be sampled during

operation, with sub-samples taken for analysis and returned to the

leach without distorting the mass balance. Cyanide concentration and

species are monitored using the Cynoprobe on-line analyser, and a

SCADA system is used for data capture and trending. The new reactor


Pics from top

to bottom:

Apparatus

for

determining

the rate

of oxygen

uptake

during gold

leaching.

Elution

the MINIXTM

gold-selective

resin.

The control

room in

Mintek’s

DC arc

demonstration

smelting

facility.

will initially be used in development work on high-arsenic gold

ores, incorporating arsenic speciation and mass-balancing. The

equipment will eventually form part of a comprehensive facility

for characterisation and problem-solving on gold leach and

adsorption circuits, from both the process and the environmental

aspects.

Process development

An extensive suite of testwork, including mineralogy,

comminution and gravity concentration, leaching, adsorption,

and carbon-in-pulp/carbon-in-leach (CIP/CIL) modelling, was

Gold’s Modder East project. On the commercial plant, which is

being designed by Bateman, about 40 per cent of the gold will

be extracted in a gravity circuit, with the remainder recovered by

CIL. The work showed that recoveries of between 87 per cent and

new gold mine on the East Rand in almost 30 years, is scheduled

to start production in the third quarter of 2009, and will reach a level

of 110 000 ounces (3.42 tons) a year at full output.

Laboratory testwork was conducted to evaluate processing options as

part of the feasibility study, carried out by MDM Engineering, for Mano

River Resources’ New Liberty gold project in Liberia. This project is

production targeted for the latter part of 2007.

A visit was paid to CVG Minerven in Venezuela to carry out a basic

Recommendations were made regarding options for upgrading the plants’

capacities and introducing new technology, as well as for tailings re-

treatment and cyanide management. Further work, including testing of a bulk

sample for process development, is anticipated in 2007.

The MINIXTM gold-selective resin was tested in a resin-in-leach (RIL) pilot plant

at Fairview gold mine, which was run by Gold Fields in collaboration with the

then owners of the mine. Gold Fields, who supply the Biox® technology used at

Fairview, are continuing work with Mintek to reduce the thiocyanate concentration

in the tailings. The MINIX resin was also tested successfully for scavenging

dissolved gold from slimes-dam return water at a Witwatersrand gold mine.

A number of service projects were carried out for projects in Botswana, the DRC,

Ghana, Mali, Romania, Zambia, and Zimbabwe, as well as South Africa. Ongoing

testing of surfactants (wetting agents) for application in heap leaching was conducted

in collaboration with the manufacturer. A new CIP/CIL and resin-in-pulp/resin-in-leach

(RIP/RIL) computer modelling programme was developed to interface with standard

Microsoft®Windows-based processes.

PLATINUM-GROUP METALS (PGM) INDUSTRY

Demonstration of the smelting step of the proposed ConRoast process for recovering

PGMs from high-chromium low-sulphur concentrates continued until the end of the year

under review. Four major DC furnace campaigns have now been conducted, treating a

total of 28 000 tons of revert tailings and other materials with Cr2O

3 contents of up to 5

per cent, at feed rates exceeding 1 000 tons per month. During the last campaign, which

ran continuously for 17 months, the availability of the furnace was 91 per cent.

The full ConRoast process involves the smelting of dead-roasted sulphide concentrates,

with recovery of the PGMs and base metals into an iron-based alloy rather than a sulphide


Pics from top to

bottom:

A furnace tap

during the

ConRoast

smelting

campaign.

Flotation pilot

Pilanesberg

Pics 3 and 4:

The QEMSCAN

and Mineral

Liberation

Analyser

are used

extensively for

PGM process

development.

of ore types and concentrate compositions - it removes the limits

on the minimum quantities of contained base metals or sulphur, and

can tolerate the high chromite levels in concentrates characteristic

of UG2 ores without the necessity for copper cooling elements in the

furnace sidewalls.

of material was smelted in a 200 kilovolt-ampere DC arc furnace. A high

recovery was obtained, with 98% of the platinum, palladium, and rhodium

reporting to the iron alloy phase. An engineering feasibility study of the

process is under way, with Mintek providing design inputs for the proposed

commercial furnace.

Laboratory and pilot-plant testwork was carried out in support of the

feasibility study, by SRK Consulting, on Platmin’s Pilanesberg project. The

bench-scale testwork was conducted on diamond drill core samples and

the silicate and UG2 ores in industry-standard primary and secondary circuits,

were performed using ore from a trial pit excavated at the Tuschenkomst

property. The data generated during this work will be used to design the

processing plant, which will consist of separate concentrators for the silicate

ore and UG2.

A 60-ton representative sample from Ridge Mining’s Sheba’s Ridge project

was piloted to provide metallurgical design data for the feasibility study.

towards the pre-feasibility study (Annual Report 2006), with recoveries

of 86 per cent for copper, 69 per cent for nickel, and 73 per cent for

is scheduled for completion at the end of calendar 2007. According to

the pre-feasibility study, completed in March 2005, Sheba’s Ridge will

produce 24 000 ton of nickel, 12 000 tons of copper, and 390 000

ounces of PGMs and gold per annum.

Three pilot runs, plus extensive laboratory-scale work, were

completed on different ore types for Barrick Gold’s Sedibelo

project, and this work is continuing into 2007. Other investigations

were carried out for Sylvania Resources on the recovery of PGMs

from chromite tailings, and for AfriOre’s Akanani project (now

owned by Lonmin).

A considerable number of quantitative mineralogical

investigations, using the QEMScan and Mineral Liberation

characteristics of the PGMs, were carried out in conjunction with

the process development work. Mintek also worked closely with

the suppliers of both these technologies to increase the accuracy

of the results from rapid, automated scans of PGM-bearing

samples. This is a particular issue with the PGMs, because of the

overlap in spectral windows. In a new development, a quantitative

scanning electron microscope was set up on site at Mintek for

one of the major PGM producers. Mintek has been running the

instrument on the client’s behalf to provide prioritised mineralogical

support during studies of the various plant streams for mass-balance

purposes and other research projects.

As part of its research into more cost-effective comminution

technologies, Mintek commissioned a pilot-scale high-pressure grinding


Pics from top

to bottom:

A pilot-scale

high-pressure

grinding

roll .

Pouring

molten

metal into

atomiser

cup.

Product from

roll (HPGR). This is a relatively new technology, which uses the

principle of interparticle crushing between two counter-rotating

conventional crushing in certain applications, the HPGR generates

a product with very favourable characteristics for downstream

processing, from incipient crack formation to complete particle

disintegration.

Testwork has been carried out on a number of ore types, mainly

from the PGM sector. While UG2 ores are generally too abrasive

for effective processing, considerable success has been realised

with Merensky ores. The results show that incorporating a HPGR

before the primary milling stage could lead to lower comminution

costs and enhanced metallurgical performance. Locked-cycle tests

to investigate whether the HPGR could in some instances replace

the primary milling circuit have indicated that a grind of 100 per cent

passing 600 micrometres can be achieved with a circulating load of

70 per cent. Mintek is planning to install a second, larger HPGR during

2007.

Phase 1 of a study in minor element deportment in PGM smelting,

which was conducted as part of the AMIRA P671 Project, was

completed. The results showed the need for further development of

analytical techniques, which would form a basis for the likely extension

of the project.

The Platinum Development Initiative (PDI) is a collaborative programme,

supported by the three major platinum producers, to develop new industrial

uses for platinum. The initial work of the programme focused on developing

platinum-based analogues of nickel-based superalloys. Experimental

phase-diagram work on the platinum-aluminium-chromium and platinum-

nickel-ruthenium systems has been completed, while the establishment of a

thermodynamic database for the platinum-aluminium-chromium-ruthenium alloy

system is almost complete. The outstanding phase diagram work will be done

at the University of the Witwatersrand under the Centre of Excellence in Strong

Materials.

The DST-funded programme for fast-tracking the commercialisation of platinum-

base superalloys has progressed according to plan. Three projects were initially

envisaged – the glass industry, coatings, and powder metallurgy. After a review, the

glass component was terminated, since it was felt that this project could not compete

with the well-established technology offered by the major players in the sector. A R2

million physical vapour deposition system has been commissioned for the coatings

work, which is being undertaken in collaboration with the University of the Free State

alloyed buttons produced at Mintek, and are being characterised at UFS as part of a

PhD study.

An Atomijet atomisation rig, capable of producing platinum powders in the size range

from 30 to 150 micrometres has been commissioned, and an uniaxial compaction press

is being re-furbished and should be delivered in the second half of 2007.

In September, six members of the PDI research team gave presentations at the

Japanese-South African-German Workshop and Summer School in Bayreuth, Germany.

This comprised a gathering of scientists from Germany, Japan, Russia and South Africa

FERROUS METALS INDUSTRY

The titaniferous magnetite layers in the Upper Zone of the Bushveld Complex contains


Pics from top

to bottom:

Small-scale

smelting

titaniferous

magnetite.

Conducting

a ferronickel

smelting

campaign at

Mintek for

Oriel Resources

Plc.

A grinding ball

sectioned for

metallurgical

analysis.

SmartboltTM

austenitic

stainless steel.

vast resources of iron, vanadium, and titanium, but to date no

process has been developed that can economically recover

all three of these metals. The high titania levels make the ore

unsuitable for smelting in a traditional blast furnace, and the

and Vanadium, which operate the Mapochs Mine, processes the ore for

iron and vanadium, but discards the low-grade titanium slag.

Veremo Holdings has begun an evaluation of the feasibility of utilising

part of the titaniferous magnetite ore from the Bushveld Complex to

produce iron units that could be used as feed for foundries and steel plants.

The initial feasibility study includes the potential recovery of titania and

vanadium from the slag.

Approximately 5 tons of concentrate was produced from 14 tons of trenched

material and smelted in Mintek’s 200 kilovolt-ampere DC arc furnace.

The testwork was aimed at producing slag that could be used in further

development work, as well as evaluating the deportment of iron, titanium,

and vanadium under varied reducing conditions.

additions, the process could be controlled to produce good-quality iron with

high recoveries and a wide range of titania-containing slag compositions.

Further development work will investigate the feasibility of upgrading

2 and

recovering the vanadium from the slag.

Oriel Resources Plc (Oriel) has been engaged in developing its

Shevchenko Nickel project in Kazakhstan since 2004, and conducted a

major ferronickel smelting campaign at Mintek in 2005 (Annual Report

2005). Bateman was appointed in late 2004 to conduct a feasibility

study that was completed at the end of 2005 based on the work at

Mintek . The process includes an Aerofall mill and Polcal calciner

from Polysius, Germany, and the twin electrode DC arc furnace

is similar to the approach envisaged for the Koniambo ferronickel

project in New Caledonia, now owned by Xstrata.

Oriel has continued to develop the Shevchenko project and

to evaluate the selected process options so that the most

appropriate approach can be chosen for the project to proceed.

Mintek has been conducting additional testwork on these process

options for Oriel to assist with the project development.

In 2005, Mintek began a major collaborative project, funded

by the Innovation Fund and supported by Anglo Platinum, the

University of Pretoria, and an industrial partner, to develop

a more cost-effective grinding ball for the minerals industry.

Samples produced in laboratory-scale melts are undergoing

screening, and in parallel with this, reference balls are being

produced so that the casting methods can be optimised. Batch

tests of balls cast from the most promising materials are planned

Trials of the “smart” rockbolt, or SmartBoltTM, are continuing in

“highly critical” areas on two deep-level gold mines. Mintek is

working with a team of specialists towards the commercialisation of

both the SmartBolt and the HerculesTM low-nickel austenitic stainless

steel, and the Innovation Fund has indicated that it will support

commercialisation if the two projects merit it.


Pics from top

to bottom:

Spiral

separation of

chromite.

Density

fractions of

an iron-ore

sample.

The

Sarcheshmeh

mine in Iran.

The project proposals and funding agreements for the ferrous

and base metals pillars of the Advanced Metals Initiative, which

quarter of 2007. Three projects have been proposed under this

initiative, all of which are aligned strongly with the automotive

industry.

An investigation was begun on the pre-reduction of manganese

ore and the possibility of recovering energy from the liquid slag.

These processes hold potential for reducing the carbon dioxide

emissions produced during smelting, and possibly for the

production of hydrogen.

Work continued on iron ore characterisation for Kumba

Resources in support of the Sishen Expansion Project. In

addition, investigations were carried out on the upgrading of

elutriation, and magnetic separation.

Metallurgical testwork, involving investigations of the size

distribution, comminution characteristics, washability using heavy

liquid separation, and gravity separation using tables and spirals,

was conducted on material from Chromex Mining’s Mecklenburg

chromite project. The results were used as input for the detailed

design and costing exercise, and to forecast the product split into

chemical, and foundry grade).

NON-FERROUS METALS INDUSTRY

The bioleaching work package under the European Union’s BioMinE

project, which is co-ordinated by Mintek, has continued to progress well.

During the year under review, a number of project partners investigated

the process engineering development, as well as the more fundamental

technology, related to the bio-hydrometallurgical treatment of two low-grade

Integrated pilot campaigns on the complex polymetallic concentrates from both

of these deposits is scheduled to begin at Mintek in the second half of 2007,

and will run through to mid-2008. It is anticipated that a number of our European

colleagues in BioMinE will participate in this programme, which, if successful, will

lead to pre-feasibility studies. Although the resources are of European origin, the

outcome of the work will be directly relevant to similar deposits in southern Africa

and in other parts of the world. BioMinE is funded under the EU’s Sixth Framework

Programme (FP6), and is also supported by a major strategic investment by the

DST.

Large-scale piloting of Mintek’s heap bioleaching technology for chalcopyrite-

bearing copper ores continued at the Sarcheshmeh Copper Complex in southern

2005, a further three 20 kt heaps were commissioned at approximately three-monthly

Copper Industries Company (NICICO) has decided to proceed with the development

of a commercial plant, with a capacity of 12 kt of copper metal per annum, at the

Dahrezar copper mine. Mintek will be contributing to the feasibility study for the project,

which is scheduled for completion towards the end of 2007, and will remain closely

involved in the engineering and commissioning of the planned commercial plant.

The successful heap bioleaching of chalcopyritic ores depends on the generation and

preservation of heat of chemical reaction in the heap, and prolonging the permeability

of the heap. These objectives have been realised by a combination of certain heap

construction features and operational tactics, and the life cycle of each heap has been


Pics from top

to bottom:

Heap bio-

leaching at

Sarcheshmeh.

• Pregnant

leach solution

ponds.

• Pond under

construction.

• Inoculum

preparation

plant.

• Auger

sampling of

heap.

partitioned into several operating stages, each with its own targets

and criteria for completion. This approach has required a new

level of sophistication in heap leaching. For the Iranian pilot plant,

a spreadsheet-based operator advisory and administration system

has been developed, which tracks the life cycle of each individual cell

within a heap, and provides operator support for the most essential daily

decisions. These include the allocation of irrigant (intermediate leach

or to intermediate leach solution), and adjustment of the irrigation and

aeration rates to satisfy the stoichiometry of the reaction and maximise

heat accumulation within the heap. For commercial applications, a more

sophisticated package with additional features is being developed, that will

integrate with current industry-standard SCADA and database software.

As a result of the success at NICICO, Mintek has undertaken a considerable

amount of heap-bioleaching amenability testwork, which could lead to this

technology being further evaluated for application to low-grade copper, nickel

(sulphides and laterites), and uranium deposits in southern and central Africa.

Development continued on a novel technique for inoculating bacteria into

leach heaps, with the aim of obtaining a more rapid start-up and enhanced

oxidation rates, which will lead to higher heap temperatures and faster

copper leaching. A set of 6 m column leach tests were conducted on a low-

grade chalcopyrite ore, and further work is being conducted on techniques

to monitor the process. This project is being carried out with an industrial

partner, with funding from the Biotechnology Partnership and Development

(BioPAD) initiative.

Mintek is continuing with research on the development and optimisation

of molecular techniques for identifying the micro-organisms involved in

tank and heap leaching, in order to gain an improved understanding

vice

versa. Work at the University of the Free State and Rhodes University

on the production of precious-metal nanoparticles by biosynthesis

is focusing on the isolation of the proteins and enzymes involved,

with the aim of linking these to the varios sizes and shapes of

particles that are produced. A second round of THRIP funding has

been received for investigations into the bioleaching of silicate

minerals. Two MSc projects are under way, on nickel laterites (at

the University of KwaZulu-Natal) and the bio-assisted weathering

of kimberlites (at the University of the Witwatersrand), and will

be completed in March 2008. Two BTech projects are being

undertaken at Tshwane University of Technology on the biological

degradation of cyanide species.

In support of a study of a major expansion at the Nkomati

nickel mine, an 80 ton bulk sample of the Chromititic Peridotite

Mineralised Zone (PCMZ) was processed in Mintek’s milling and

The plant incorporated a scavenger cleaner circuit and employed

optimised residence times to enhance the recovery of the slow-

undertaken on a sample from the Main Mineralised Zone (MMZ).

ore, previously regarded as uneconomic, can be processed to

yield a saleable concentrate. This, together with improved metal-

price forecasts, made it possible to lower the cut-off grade applied to

portions of the resource, thus increasing the open-pit reserves.

As a result of applying the lower cut-off grades and including the


Pics from top

to bottom:

Flotation

pilot-plant

campaign on

Nkomati ore.

The Nkomati

Nickel Mine

(photo

courtesy

Nkomati

Nickel).

Pilot-plant

operators

take samples

from the

manganese

solvent-

extraction

circuit

to purify

the cobalt

electrolyte

before

electro-

Copper

electro-

the KOV

PCMZ, Nkomati’s nickel reserves have increased by 50 per

cent – to 485 377 tons. The by-product reserves have also

43 per cent, and 4.181 million ounces of PGMs, a 70 per cent

increase. Based on these positive results, LionOre and ARM

commissioned DRA to proceed with a bankable feasibility study

for the large-scale expansion of the concentrator plants.

The proposed large-scale expansion, planned for 2010, will

incorporate mining of the PCMZ, increasing annual production

to approximately 20 000 tons of nickel and extending the life of

the mine to beyond 2020. An interim expansion exploiting the

disseminated MMZ will maintain nickel production at its current

level of about 5 000 tons per year after the massive sulphide

mineralisation is depleted in 2008.

Mintek has carried out process development work for a number

of copper-cobalt projects in Zambia and the DRC. Among these

a South African mining company in the DRC for many years. The

started up in September 2006. The second phase, which will involve

cobalt metal on-site at Ruashi, is under construction.

Mintek began bench and pilot work, which would be used in the bankable

feasibility study for phase II of the project, in April 2006. Three campaigns

were conducted, and the work was completed during March 2007.

In the design of the solvent-extraction and electrowinning circuit, Mintek

worked closely with Metorex’s design company, TWP Matomo Process

Plant. The plant has been designed for a capacity of 120 000 tons of ore per

month. When the phase II expansion is completed, production at Ruashi is

expected to increase to 45 000 tons of copper cathode and approximately 3

500 tons of cobalt metal and cobalt carbonate per annum.

A major process development campaign was conducted for the KOV copper-

cobalt project, also in the DRC. A total of 27 tons of material was delivered to

laboratory tests to determine the optimum leach conditions, integrated piloting of the

leaching, copper solvent extraction and electrowinning circuit, and Aspen simulation

LME Grade A standard (higher than 99.95 per cent copper), were produced. The KOV

complex, which contains one of the world’s largest high-quality copper and cobalt

resources, is being re-developed by Nikanor plc. The project will include a major

27 500 tons per year of cobalt products.

Dense-media separation, milling, and leaching testwork were carried out to investigate a

Green Team Consultants International.

Mintek has been involved in numerous projects to remove iron and manganese from

dilute cobalt sulphate solutions by oxidative precipitation using air/SO2. This technology

is attractive as it can be done at ambient temperature, relatively low pH, and ferrous

iron is quantitatively removed within 1-2 hours. In order to produce cobalt cathode of the

desired quality, iron, manganese, copper, zinc, and aluminium must generally be removed

from the feed to electrowinning. The requirements to produce an intermediate cobalt salt

are generally less stringent, but usually iron, aluminium, and manganese still need to be

removed.


Pics from top to

bottom:

The Outotec

high-shear

impeller.

Laboratory

NicksynTM

reagent in

support of the

at Tali Nickel.

The thermal

Magnesium

Process demon-

stration plant.

The recent interest shown in this technology by emerging

copper-cobalt producers in central Africa has encouraged Mintek

to do some work to identify potential scale-up issues. Various

agitators and gas induction systems were investigated, and a high-

shear impeller designed and supplied by Outotec was selected for

further testwork on a 2 m3 scale to examine the effects of parameters

such as SO2

and temperature on the process. Optimisation tests remain to be done

on power consumption and various aspects around gas induction.

Two smelting campaigns were conducted on discard slag from BCL in

Botswana to compare the use of AC and DC furnaces for recovering

nickel and copper. The results showed that both technologies were equally

effective, and that the company could substantially improve the recoveries

in its slag-cleaning operation by adding reductant to the existing settling

furnaces.

The Mintek-developed nickel synergist (Nicksyn™) was evaluated to

optimise nickel recovery and nickel-calcium separation at Tati Nickel in

Botswana. Laboratory test work was conducted at Mintek on the feed to the

nickel solvent-extraction circuit to optimise the combination of the synergist

and the Versatic 10 commercial extractant, and the results applied on the

Activox® hydrometallurgical demonstration plant at Tati using a 0.5 ton

commercial batch of Nicksyn.

on the organic phase, which could result in gypsum formation in

the extraction circuit if the feed becomes saturated with calcium.

Previously, Tati Nickel minimised the problem by diluting the feed

stream with fresh water, but this would increase the size of the

production. Furthermore, with Versatic 10, the pH of extraction

cannot be increased as this causes higher calcium loadings -

extraction stages).

With the synergistic system, the calcium loading was about

one-tenth that obtained previously, and gypsum formation can

be completely avoided. The Versatic-Nicksyn combination also

achieved higher nickel recoveries (99.7 per cent compared

with about 99.3 per cent) using only four stages. In addition,

lower reagent losses were experienced, which can be ascribed

to the much lower pH of operation and the reduction in crude

formation.

Work continued on the production of titanium-aluminium master

alloys by aluminothermic reduction, and a project is in progress

at the University of Cape Town on the fundamental aspects of the

titanium-aluminium-oxygen-carbon-nitrogen system to determine

the best criteria for scale-up.

Following a review of the economics of the Mintek Thermal

Magnesium Process, Anglo American has decided not to pursue

commercialisation, since it is felt that it would not be able to

compete with the low-cost Chinese producers. Mintek will continue to

look for opportunities for applying the technology.


Pics from top

to bottom:

Small-scale

pressure

leaching of

a uranium

contentrate.

uranium

leach liquor.

Uranium

oxide

precipitation.

Hydro-

phobicity

a diamond-

bearing

concentrate.

INDUSTRIAL MINERALS

ambient and pressure leaching, gold diagnostic leaching,

and CIL adsorption, was done for the Buffelsfontein tailings

recovery project owned by First Uranium, the gold and uranium

subsidiary of Simmer and Jack Mines. Based in this preliminary

to recover an uranium concentrate, then pressure leaching,

solvent extraction and ion exchange using NIMCIX continuous

leach residues would be treated in a CIL plant for gold recovery.

Also for First Uranium, pilot-scale leaching was conducted on a

bulk underground sample from the Ezulweni project to produce

a feed for solid-liquid separation, countercurrent decantation,

and ion-exchange testwork. The results will be used to generate

design criteria for a possible NIMCIX plant. Both these projects

are continuing into 2007.

Testwork was completed on the development of the process

Malawi, as part of the bankable feasibility study by GRD Minproc.

Paladin gave the go-ahead for the development of the project in

February 2007, and commissioning is scheduled for the third quarter

of 2008. Kayelekera will be Paladin’s second uranium mine in southern

Africa – Langer Heinrich in Namibia, for which Mintek conducted

2007.

Mintek’s uranium business continues to grow, and an increasing number

of approaches are being received concerning proposed projects on

Witwatersrand-type materials, particularly tailings re-processing for both

uranium and gold. Some of these are potentially very large projects. Mintek’s

strength in this area is the comprehensiveness of the services it can provide,

from initial investigations up to large scale piloting.

During the year, a new laboratory facility for characterising diamonds according

to their hydrophobicity (response to grease-table recovery) and luminescence

(recovery by X-ray methods) was fully commissioned. The laboratory has met with

an extremely favourable response form major industry players, including De Beers,

SouthernEra, and Bateman, and work on optimising recovery processes has been

done for a number of projects in South Africa and overseas. Mintek has engaged

an internationally recognised expert in kimberlite petrology and diamond studies,

and this project will be expanded in 2007/08 to include diamond characterisation for

purposes of marketing valuation and population discrimination.

Ongoing heavy-liquid separation testwork was carried out for De Beers to evaluate

Mintek’s capabilities in chlorination technology were further developed with the

can handle kilogram-size samples, resulting in a much-improved mass balance.

A suite of testwork, including sample characterisation, heavy-liquid separation, shaking-

conducted on a sample of bauxite. The aim of the work was to simulate a processing


Pics from top

to bottom:

Personal

Protection

Equipment

(PPE) for

radiation

Monitoring a

bulk sample of

uranium ore.

Mintek’s HIV

Committee.

Access to

potentially

hazardous

areas is

restricted

to trained

personnel.

route to remove the quartz and hematite/goethite from the

material. It was found that around two-thirds of the total silica,

and more than half of the Fe2O

3, could be removed, which as well

as resulting in a higher-quality product, would reduce the formation

of “red mud” in the Bayer process.

QUALITY, ENVIRONMENT AND SAFETY

Mintek’s Environmental Management System underwent a successful

audit, for OHSAS 18001 (Occupational Health and Safety), will take place

in 2007, and that for IS0 9001 (Quality) the following year. Re-assessment

The Analytical Services laboratories underwent a successful surveillance

audit for ISO 17025 compliance in 2006.

At the end of the period under review, the Lost Time Injury Frequency Rate

(LTIFR) was 2.0, compared with the target of 1.0. The Client Dissatisfaction

Frequency Rate (CDFR), after consistently achieving the target of less

than 10, rose sharply in the second half of the year. This was due to late

delivery of results, and communication problems with the clients, on

several minor projects undertaken by one of Mintek’s divisions. Steps

have been taken to remedy these problems.

During 2006, two new indices were established: the Major

Environmental Incidents Frequency Rate (MEIFR) and Public

Dissatisfaction Frequency Rate (PDFR). Mintek’s MEIFR is above the

target of 5 at the moment. The upward trend is possibly the result of

as corrective action is implemented. The PDFR (which is a subset

of the MEIFR) is also above the target – however, the public

Mintek is registered as a uranium testwork facility with the NNR

and the Department of Minerals and Energy (DME). A Radiation

Protection Programme (RPP) has been incorporated as part of

the overall Safety, Health, and Environment programme, and

an internal audit schedule, incorporating site inspections by the

NNR, has been implemented.

“During the year, a new laboratory facility

for characterising diamonds according to their

hydrophobicity (response to grease-table recovery)

and luminescence (recovery by X-ray methods) was

fully commissioned.”


Main pic:Tapping

PGM-bearing

alloy during

a Consmelt

campaign.

annual report 2007

COMMERCIAL

ACTIVITIES

Mintek’s commercial activities comprise participation in operating

companies and joint ventures, sales of equipment and technology licensing

agreements. Mintek also actively promotes the establishment of mineral-

based development projects that could utilise its technologies.

PARTICIPATION IN OPERATING COMPANIES

Mindev (Pty) Ltd. (Mindev) is a wholly owned local holding company that

was established by Mintek in 2002 to support the commercialisation of its

technologies via partnerships in operating business ventures.

Mogale Alloys (Pty) Ltd. was formed in

2003 to recover nickel and chromium

from furnace dust produced by Columbus

Stainless at Middelburg, using the DC

arc furnace at Samancor Ferrochrome’s

Krugersdorp facility. During the period

under review, Mindev concluded the sale

of its 25 per cent interest in Mogale and

a licence agreement for the DC smelting

technology to PGR 17 Investments (Pty)

Ltd., the existing management team,

for a total consideration of R43.15

from the premium that the remaining

shareholders were prepared to

pay in order to gain control of the

company.

Mindev is in the process

of divesting its 25 per cent

shareholding in TollSort (Pty) Ltd., to MikroSort (Pty) Ltd. the

vendors of the optical sorting technology, following a decision

been made in the optical sorting of low-grade gold, PGM, and

other ores, it was decided that the additional investment and

time required to fully develop the technology to a point where it

unacceptably high risk.

MINTEK BUSINESS DEVELOPMENT PROJECTS

Mintek’s Business Development group is pursuing several

opportunities for commercialisation of the organisation’s

intellectual property.

Independence ConRoast PGM Project

In June 2006, Mintek and Independence Platinum Ltd. (IPt), a

subsidiary of Braemore Resources plc, entered into an exclusive

agreement for the commercial development and implementation

of the ConRoast process. In terms of the agreement, IPt will fund a

“Several independent

analyses have concluded

that, depending on the

implementation of smelter

expansions by the major

producers and the number

of new PGM projects that

come on stream, the South

African PGM sector will

require additional smelting

capacity within the next

”


Pics from top

to bottom:

tion testwork.

The SAVMIN

pilot plant

at Grootvlei

gold mine.

Metallo-

graphic

character-

isation of

grinding

balls.

annual report 2007

US$15 million work programme over three years, including a

emerging PGM producers in South Africa.

Several independent analyses have concluded that, depending

on the implementation of smelter expansions by the major

producers and the number of new PGM projects that come on

stream, the South African PGM sector will require additional

than half of the new production will come from UG2 ores,

which pose technical challenges for conventional six-in-line

particularly for nickel, will be needed to enable the processing

of Platreef ores.

As part of the development programme, IPt will continue with the

demonstration work at a commercial scale (from 1 000 - 2 000

tons per month) at Mintek, using a range of high-chromium PGM

concentrates.

IPt is evaluating the project in terms of a smelter with a target

capacity of 360 000 tons of concentrate per annum. The feasibility

annum), which is being conducted by engineering project house TWP

SAVMIN development and licence agreements

Mintek’s SAVMIN process for purifying sulphate-polluted mine drainage

has undergone two highly successful large-scale demonstrations,

Negotiations are now underway to license the technology, on a non-

satisfy the environmental obligations of the mining companies in the area, and

pilot plant is currently underway.

Iron and steelmaking projects

A study was completed for the IDC on cataloguing iron-ore resources in South

The results indicated that an expansion of South Africa’s steelmaking capacity to

supply some of the requirements of the increased world demand for steel could

be feasible.

testing and feasibility study services. These include:

• Maputo Metallurgical Complex - a plant to produce 3 million tons per annum of

steel and 1.5 million tons per annum of iron ore pellets using Palabora magnetite.

• Coega Steel Complex - a plant to produce 3 million tons per annum of steel and 5

million tons per annum of iron ore pellets using Kumba concentrate.

• Northern Cape Steel - a plant to produce 3 million tons per annum of steel using

• A plant to produce around 1 million tons of steel per annum using Foskor magnetite.

• A plant to produce around 1 million tons per annum of iron or steel using Bushveld

Complex magnetite.


Pics from top

to bottom:

Columns for

heap bioleach

process devel-

opment.

The FloatStar

and optimisa-

tion strategy

is installed on

the majority of

South Africa’s

PGM concen-

trators.

An industrial

milling circuit.

annual report 2007

Heap leaching of nickel laterites

Heap leaching of low grade nickel laterite ores is receiving

considerable attention from nickel producers internationally. If

technically and commercially viable, it will represent a paradigm shift

in the industry. Mintek is drawing on its experience in heap leaching in

other areas to develop expertise in nickel laterite processing, under the

auspices of a project with an industry partner. The Mintek technology,

at this stage, is not unique - it is rather a general competency in this

work in this exciting area.

Thermal magnesium

Following a review of the economics of the Mintek Thermal Magnesium

Process, Anglo American has decided not to pursue commercialisation,

since it is felt that it would not be able to compete with the low-cost Chinese

producers. Mintek will continue to look for opportunities for applying the

technology.

PROCESS-CONTROL PRODUCTS

than expected, mainly as a result of timing problems at various clients’

sites. FloatStars were implemented on a trial basis at Aquarius Platinum’s

Everest operation, and at a major nickel producer in Australia. At the

which set the limits within which the level setpoints can be moved, were

incorporated into the Grade-Recovery Optimiser. Five more banks of

cells were incorporated into the FloatStar control scheme at Tati Nickel

in Botswana, and a successful re-installation was undertaken at

the Crocodile River PGM plant. Service contracts were concluded

major copper producer in Chile.

of minerals in a sample. Such a technique, if successfully

developed, could be used to assist in the design and

of control schemes.

MillStar milling control was implemented on two ball mills at a

zinc producer in Mexico, and this will probably be followed by a

FloatStar installation during 2007. Following a successful trial

period, MillStar stabilising control was installed on the 3 000

ton-per-hour SAG mill - one of the world’s largest - in Chile. The

company has requested Mintek to investigate the feasibility of

installing stabilising control on two further SAG mills.

A new version of the mill power optimiser, which uses dynamic

data to optimise the load setpoint, was implemented at the Mixed

and UG2 plants at Lonmin’s Karee operations, and at Eastern

Platinum C Stream. The optimiser previously underwent trials in

terms of the corporate service contract with Lonmin (Annual Report

2006), which as well as the servicing of all current process-control

installations and software upgrades, includes an agreement for

Mintek to trial-install new technology at Lonmin’s plants in return for

reduced prices on purchases.


Pics from top

to bottom:

A Cynoprobe

was installed

at Polymetall

in Russia, and

this will be

followed by

a LeachStar

controller in

2007.

The measure-

ment cell in

the Cyno-

probe.

Mintek’s Arc

Monitor, or

Arcmon, is

an adjunct to

the FurnStar

Minstral

system that

provides

additional

information

about the

conduction

behaviour

within the

burden in sub-

merged-arc

furnaces.

AngloGold Ashanti’s Mponeng gold mine, which installed the

purchased a Cynoprobe online cyanide analyser to complement

the control strategy. Four WAD Cynoprobes, which are able

to measure the concentration of both “free” and weak-acid-

dissociable cyanide, were installed at local gold plants – two

at Beatrix and two at Driefontein. A unit was purchased by

AngloGold Ashanti’s Siguiri gold mine in Guinea and will

be commissioned in 2007, and a very successful trial was

concluded at Geita in Tanzania.

A Cynoprobe was installed at Polymetall in Russia, and this

will be followed by a LeachStar controller in 2007. Cynoprobes

were purchased by Newmont Mining Corporation’s Midas

operation in Nevada and (together with a LeachStar controller)

at Waihi in New Zealand. A trial installation was begun at the

Newmont/Peñoles La Herradura joint venture in Mexico, and

Barrick’s Henty gold mine in western Tasmania, which previously

had an older version installed on a trial basis, purchased an

upgrade.

Further development of the Cynoprobe is under way, with

measurement range of the instrument to both higher and lower

concentrations while retaining the accuracy across the range. In

particular, the monitoring of “post-mixing” aquatic systems requires the

measurement of free cyanide at parts-per-billion levels.

The latest version of the FurnStar MinstralTM control strategy for

submerged-arc furnaces, which includes power optimisation and

resistance optimisation modules, was released. FurnStar control was

implemented at South Africa’s two newest ferrochromium producers – the

Xstrata-Merafe Lion project and International Ferro Metals’ Buffelsfontein

smelter – which have a combined annual capacity of 627 000 tons of

ferrochromium. Lion Ferrochrome, near Steelpoort in Mpumalanga, which

began production in September 2006, utilises two 63 MVA furnaces. The

in mid-January, and the second of the two 66 MVA furnaces came on line in early

February.

New FurnStar installations were also completed on a further two furnaces at

upgraded with the latest version of the software.

Mintek’s Arc Monitor, or Arcmon, is an adjunct to the FurnStar Minstral system that

provides additional information about the conduction behaviour within the burden in

submerged-arc furnaces. Arcmon makes it possible to study the detailed behaviour

of the electrical circuit in a submerged-arc furnace in real time. Its ability to distinguish

between arcing and resistive conduction provides useful information about the burden

of a furnace within its reactive zone, including the carbon balance and the metal

bath level. Arcing information can also be used to improve the regulation of electrode

Extensive Arcmon studies have been undertaken on the electrical conduction in silicon

metal, ferrosilicon and ferrochromium furnaces, and during 2006 a further trial was

2007.

annual report 200735 annual report 2007

Pics from top to

bottom:

A 125 kilogram

per hour

Minfurn carbon-

regeneration

furnace was

commissioned at

Compañia

Minera San

Simon SA in

Peru.

The latest

version of

the Atomijet

atomiser was

installed and

commissioned at

Impala Platinum

Springs.

Four new

standards in the

series of South

African Refer-

ence Materials

(SARMs) were

manufactured

Metallurgical

accounting

and geological

resource evalu-

ations depend to

a large degree

on the qual-

ity of analytical

results. Mintek

is seeking op-

portunities to

grow its SARMs

business.

CAPITAL EQUIPMENT

A 125 kilogram per hour Minfurn carbon-regeneration furnace was

commissioned at Compañia Minera San Simon SA in Peru. This

was the second installation of the higher-capacity Minfurn, which was

in a larger unit. The larger furnace has a capacity comparable with

conventional regeneration equipment such as rotary kilns, while retaining

the advantages of the unique resistive-heating technology employed in the

Minfurn. A 75 kilogram per hour furnace was installed at Yamana Gold’s São

Francisco operation in Brazil. Orders were received for a further 75 kilogram

per hour unit (Mineração Turmalina, Brazil) and a 125 kilogram per hour unit

(COMARSA, Peru), and these will be commissioned early in 2007. These two

furnaces are the latest PLC-based models, with the ability to allow remote

access via Ethernet if the appropriate hardware is installed.

hopes to break into this market shortly.

The latest version of the Atomijet atomiser was installed and commissioned

capacity of 50 kilograms per batch, can operate at temperatures up to more

than 1 600°C, compared with 1 100°C in earlier models. This extends the

range of materials that can be processed.

SOUTH AFRICAN REFERENCE MATERIALS

Four new standards in the series of South African Reference Materials

– a ferrochromium metal, a ferrochromium slag, a low-grade nickel-

PGM sulphide, and a feed-grade Merensky Reef material. In addition,

four uranium standards were produced for a consulting company. A

uranium ore standard and a UG2 PGM standard will be released

Further gold, uranium, and rock reference materials are planned

to replenish stock levels, as well as new materials for copper,

cobalt, nickel, and tantalite ores, Toxicity Characteristic Leaching

Procedure (TCLP) standards, and polluted soils and sediments. A

vertical stirred mill has been purchased for the fast production of

micrometres) and a small standard deviation.

Metallurgical accounting and geological resource evaluations

depend to a large degree on the quality of analytical results,

and Mintek is seeking opportunities to grow its SARMs business.

The SARM programme has joined the recently formed South

African branch of the ISO Committee on Reference Materials

(REMCO), whose aim is to co-ordinate a broad international effort

“Further development of the Cynoprobe is under

circuitry to extend the measurement range of the

instrument to both higher and lower concentrations

”


Main pic:Hand-sortingmagnesiteore at a small-scaleoperation in the Limpopo province.

MINERAL POLICY

AND SUSTAINABLE

DEVELOPMENT

MINERAL ECONOMICS AND STRATEGY

Mintek’s Mineral Economics and Strategy Unit (MESU) conducts

regional commodity-based mineral economic studies to promote value

addition and sustainable development through the minerals industry, both in

South Africa and elsewhere in Africa.

Regional Mineral Economics

Strategic regional minerals scans are undertaken to highlight infrastructure

requirements, advantages of ordered development and clustering of

projects, preliminary economic analysis, and identify downstream and value

added developmental opportunities from

mineral-based projects. Two detailed

scans investigated the mineral

potentials of Limpopo and KwaZulu-

Natal.

The Limpopo scan will be used to

develop a mineral strategy for the

year. The KwaZulu-Natal project

re-investigated the remaining

coal mining potential for

the province, reviewed the

industrial minerals sector,

that could be exploited. A key feature of both projects was the

use of GIS software that allowed for different scenarios to be

evaluated. Interactive GIS-based datasets formed an integral

part of the deliverables for these projects.

MESU played a central role in studies of a number of iron

and steel projects in southern Africa. MESU also acted as

secretariat in Maputo Metallurgical Corridor Project, which

investigated the potential to establish a steel complex in Maputo

that would utilise magnetite resources from the Palabora Mining

Company dumps.

RESOURCE BASED SUSTAINABLE DEVELOPMENT

The Resource Based Sustainable Development (RBSD) strategy

has three principal themes.

• A capital equipment and services focus that supports

“Mintek also contributed to the strategy for sustainable development in mining, of development, indicators for and the development of guidelines for various aspects of the environmental impacts of mining operations.”


Pics from top to bottom:MESU is developinga strategy for Limpopo Province for supportingindustrialclusteringof supplier industries.

TheSustainableDevelopment(SD) unit continuedwith the DME’s “SustainableDevelopmentthrough Mining”programme. With water and energy becomingincreasingly scarce, not only in South Africa but across the Africancontinent,these could prove major constraintsto new mininginvestments.

The SD programme alsoundertooka study tour to the EU to engage with the EU mineralsand metals community, including the European Commission.

technology equipment and services solutions to mining

customers around the globe.

• Encouraging the lateral migration of technology from the

minerals sector to elsewhere in the economy.

products, RBSD brings a perspective of opportunities

for industrial, technological, and trade development

“upstream” and “side-stream” to the mining industry.

MESU is developing a strategy for Limpopo Province for

supporting industrial clustering of supplier industries. The

client in this project needs to develop a set of responses and

incentives to create sustainable industries in some of its mining

nodes to ensure that a manufacturing industrial cluster can be

established that is able to outlive the mining sector. The project

advice to industry and government on strategies to maximise

economic linkages and growth.

Economics Support

MESU conducted various empirical analytical studies of mining

commodities, and tracked and evaluated commodity prices cycles.

A diagnostic approach was used to identify key challenges facing the

sector and design appropriate responses. Models that predict and explain

the current commodities booms were developed. MESU was represented

at the G20 Energy and Resources Meeting in Banff, Canada.

Sustainable Development

Sustainable Development through Mining programme

The Sustainable Development (SD) unit continued with the DME’s

“Sustainable Development through Mining” programme. One of the major

projects completed was the development of an auditable checklist for

programming into the Site Inspection Assistance tool being developed for DME

for sustainable development in mining, and the development of guidelines for

various aspects of the environmental impacts of mining operations.

The SD unit is actively pursuing links with various local and international

processing. The Unit started preliminary work on a project funded by the DST that

investigates new technology mixes to conserve water during mining and processing.

becoming increasingly scarce, not only in South Africa but across the African continent,

these could prove major constraints to new mining investments.

annual report 2007

Pics from Top to bottom:MESUconductedvariousempiricalanalyticalstudies of mining sector data such as supply and demand analysiscommodities,and tracked and evaluated commodityprices cycles. A wood-fuelled pottery kiln was designed and commissionedfor the potters at Mapuve village in Limpopo, under the project sponsored by the WF Kellogg foundation.A crusher and mill were set up in Giyani, Limpopoprovince, and tests on vegetable plots have started.A small iGoli (mercury-free gold-recovery) plant was set up near Springs on the East Rand to recover gold from concentratesproduced by a small-scale operator.Mintekparticipated in the planning of the technical programme for the CASM (World Bank) annualconference in Madagascar.

39

REACH

At the beginning of 2006, MESU started investigating the impact

of the European Union’s (EU) REACH policy on South Africa’s

and Africa’s mining industry. South African mineral exports into

the EU were analysed in terms of REACH and other trade policies.

The SD programme also undertook a study tour to the EU to engage

with the EU minerals and metals community, including the European

Commission.

SMALL-SCALE MINING AND BENEFICIATION

the artisanal and small-scale mining sector through researching and

developing appropriate technologies, and by providing training and

support to ensure that development can be as sustainable as possible,

even when based on limited resources.

A wood-fuelled pottery kiln was designed and commissioned for the

potters at Mapuve village in Limpopo, under the project sponsored by

resulting in a higher-quality, more durable product.

A pilot plant was installed at the Lyttelton dolomite mine in Marble Hall

trials, in which the product was compared with commercial fertiliser

on a number of farms in the area, showed this material to be very

successful at improving the growth of a variety of vegetables.

These trials are continuing into 2007.

and mill were set up in Giyani, Limpopo province, and tests

on vegetable plots have started. Acidulation trials are being

carried out to test the release of phosphorus from mixtures of

A small iGoli (mercury-free gold-recovery) plant was set

up near Springs on the East Rand to recover gold from

concentrates produced by a small-scale operator. A pilot-

sized plant has been commissioned at Mintek to demonstrate

the process to potential users. A small group of artisanal

miners from Tanzania were trained in the process, and

a small iGoli plant will be commissioned and an on-site

demonstration will be conducted in Tanzania towards the end

of 2007.

Mintek participated in the planning of the technical programme

Mintek technology for the manufacture of glass has been

transferred to groups of rural people in Limpopo, Kwa Zulu Natal,

Gauteng and Mpumalanga.


Pics from top to bottom:Almost 800 learnersreceived training at Mintek’s Randburg campus and at satellite sites around the country. Women pot-ters were helped to improve their pottery-mak-ing skills and to market their goods, at Letsopa Artwork in and Timbita Pottery in Bushbuck-ridge.

Other spe-cialisedtraining in-cluded craft work (glass beads, jew-ellery, and pottery), soil ameliorantproduction, brickmaking,and orna-mental stone carving.Three glass-beadmakingunits were set up, at Ulundiin Kwa-Zulu-Natal,Hazyviewin Mpuma-langa, and the Cradle of Human-kind World HeritageSite, with training and equipmentsupplied.

A strategic marketing plan was formulated for the national

and international craft market segments. A feasibility study

was conducted to assess the potential of reviving the

sandstone industry in Qwa-Qwa. Business and marketing

plans were drawn up for a number of individual small-scale

operations, and assistance given with sourcing funds.

The MQA has continued Mintek’s accreditation as a skills

provider. During the period under review, 789 learners

received training at Mintek’s Randburg campus and at

satellite sites around the country. The modules included an

introduction to small-scale mining, legislation, exploration

geology, mining survey, minerals processing, health and

adding, and business skills and leadership. The commodities

Other specialised training included craft work (glass beads,

jewellery, and pottery), soil ameliorant production, brickmaking,

and ornamental stone carving. Three glass-beadmaking

units were set up, at Ulundi in KwaZulu-Natal, Hazyview in

with training and equipment supplied. Under the DME’s sustainable

development programme, work on training in ornamental stone

processing using waste material from commercial dimension-

were helped to improve their pottery-making skills and to market

Bushbuckridge.

The Timbita ceramics incubator based at Mintek is in the process

of registering with the MAPPP-SETA, the industry Skills Education

Training Authority (SETA) responsible for facilitating education and

training in the media, advertising, publishing, printing and packaging

sector, as a service provider for the Unit Standard: Craft Production,

according to registered unit standards and nationally recognised

new ceramic items to test the market. Timbita conducts tests on clays

from different localities for their suitability for ceramics or brickmaking, and

a clay database has been set up to record the geographical location of

suitable deposits.

received support from the following organisations:

CASM (Communities and Small-Scale Mining); the DME; the DST; Eskom;

the MQA; Marble Hall Municipality; the seda Technology Programme of the


Pics from top to bottom:The Kgabane jewellerytrainingprogramme focuses on the manufacture of jewellery in South Africa, using indigenousskills and traditionaldesigns.Swizzle sticks designed with an African theme.Crocheted handbags made by the rural African women. A further seven new workshop facilities – two of which will be funded by mining companies as part of their social offsets programmes - and six upgrades, are planned for 2007.

KGABANE JEWELLERY INITIATIVE

The Kgabane jewellery training programme focuses on the

manufacture of jewellery in South Africa, using indigenous

skills and traditional designs. It also provides manufacturing and

marketing support, as well as training, to poor rural and urban

communities. Eight new jewellery workshops were set up at in

Mpumalanga,

Cape. The workshop at Mopumolo in KwaZulu-Natal is notable for

at Steelpoort was funded by Xstrata as one of their social development

initiatives surrounding the Project Lion ferrochromium-smelting joint

venture.

Eight existing workshops were upgraded during the year. A further seven

new facilities – two of which will be funded by mining companies as part

of their social offsets programmes - and six upgrades, are planned for

2007.

As part of a DME initiative, Kgabane facilitates a skills exchange

programme with the People’s Republic of China. Two teams totalling

scheme to date.

Mintek also facilitated a platinum casting exhibition, in conjunction

with the DME and Lonmin Platinum, at the bi-annual Electra Mining

exhibition in Johannesburg.

“Mintek’s Mineral Economics and Strategy Unit (MESU) conducts regional commodity-

based mineral economic studies to promote value addition and sustainable development through

the minerals industry, both in South Africa and elsewhere in Africa.”


Main pic:Transformation of Mintek’s work force of highly skilled engineers,scientists and technologistshas improved steadily.

PEOPLE

HUMAN CAPITAL MANAGEMENT

Mintek attributes its position as one of the world’s leaders in mineral and

metallurgical technology to its workforce of highly skilled engineers, scientists

and technologists, who have been developing groundbreaking technologies,

products and services for the local and international mining and minerals

industries since 1934.

For the past few years, the global shortage of hard-core technical skills,

such as engineers, scientists and technical personnel has also become

increasingly evident in the South African labour market. Here the shortage is

companies in the mining, minerals and related industries competing for the

same pool of human capital and expertise in order to survive.

through competition from local and international companies. To offset

these losses the organisation embarked on a successful recruitment drive,

simultaneously developing and formulating a retention strategy to arrest

employee turnover. As one of the most important measures to retain

strategic human capital, the organisation has made every effort to close

the salary gap with the open market, however this is still a challenge for

Mintek. Strong focus has also been placed on succession planning.

TRANSFORMATION AND EMPLOYMENT EQUITY

Despite the great

shortage of engineers,

scientists and

technologists from

the historically

disadvantaged

groups at

managerial and

professional level,

Mintek’s workforce

transformation has improved steadily with the percentage

of historically disadvantaged individuals in all categories

exceeding the 50 per cent mark. The organisation has reached

its Board-approved target of 77 per cent designated group

(DG) representation. Transformation in the group’s technical

business units has also improved, and multilateral initiatives are

being employed to induce scarce scientists, engineers and highly

specialised technical staff from the historically disadvantaged group

to join the organisation.

The table above, extracted from Mintek’s Employment Equity

Report, which was accepted by the Department of Labour during

transformation in respect of previously disadvantaged persons at

management and professional levels.


Pics from top to bottom:TheEmploymentEquity and DiversityForum, which represents all categories of employees,endeavoursto create an environment whichembracesdiversity and employmentequity.

Mintek will be providing intensive in-house labour relations trainingworkshops,which will includeNUM shop stewards.A high level of HIV/AIDS awareness is maintainedby the regular distributionof posters andpamphlets.

BLACK ECONOMIC EMPOWERMENT

A joint survey by Mintek and an independent accredited

consulting organisation to verify the DG-status of the

companies in Mintek’s preferred supplier base found that the

vast majority of suppliers, including recruitment agencies and

labour brokers, were BEE compliant. Mintek has set itself

clear targets, as contained in the Compact with the Minister of

Minerals and Energy, for suppliers’ BEE compliance and will

seek alternative suppliers if these targets are not met.

PARTICIPATIVE APPROACH: MINTEK AND NUM

Mintek’s working relationship with the National Union of

Mineworkers (NUM) remains positive and NUM continually

interacts and consults with Mintek on issues that affect its

members in the workplace. With both parties aspiring to create

a more participative environment, Mintek will be providing

intensive in-house labour relations training workshops, which

will include NUM shop stewards. This will enable both Mintek and

organised labour to effectively engage on the same level in terms

of knowledge and skills in employee relations.

HIV AND AIDS

Mintek’s HIV/AIDS Committee consists of representatives from

management, the NUM, the Staff Association, Health and Safety, and

Mintek’s operating divisions.

A high level of HIV/AIDS awareness is maintained by the regular

distribution of posters and pamphlets. During the year Mintek held

a tuberculosis (TB) awareness campaign. The focus on TB is very

important, since HIV/AIDS usually manifests itself through this disease.

The Occupational Health Clinic distributes the Haart Bulletin News on a

weekly basis to all Mintek peer educators in order to keep them abreast

of the latest information and developments on HIV/AIDS matters. Peer

group counselling training has also been conducted by peer educators

from various divisions at Mintek to develop skills and provide an in-depth

understanding of HIV/AIDS issues.

A dedicated HIV/AIDS site on the Mintek website and intranet is being

developed so that up-to-date information is available at all times.

The Mintek Medical Clinic, in association with the Randburg Municipality,

also offers voluntary HIV/AIDS testing and counselling. The Mintek HIV/

AIDS Committee continues to support the Ikaneng/Itireleng AIDS Outreach

Programme.

The “Know Your Status” campaign is an ongoing initiative and approximately 18

per cent of all Mintek employees know their HIV/AIDS status and efforts are being

made to de-stigmatise HIV/AIDS in the workplace.

WELLNESS

To promote and encourage the wellness of its employees, Mintek, in conjunction

with a well-known behavioural risk management partner, has been providing its

workforce with Employee Assistance Programme (EAP) services. As can be seen

from the growing utilisation of EAP services across various levels of the organisation,

employees are appropriately using the EAP to diminish the potential negative impact of

behavioural risk factors.

Despite the healthy state of the South African economy, statistics have shown that money


Pics from top to bottom:Mintek has set itself clear targets, as contained in the Compact with the Minister of Minerals and Energy, for suppliers’ BEE complianceand will seek alternativesuppliers if these targets are not met. Minteksupported 44 trainees by providing on-site in-service training to enable students at universities of technology to complete their compulsory one year of practical experience.A total of 335 staff members, as well as an additional 57 non-permanentmembers of staff, received diversetraining and developmentinterventions.

management, relationships, and legal issues were the most

important matters dealt with over this period. As such issues

ultimately increase stress, Mintek will provide stress management

year to assist employees in dealing with matters of this nature.

Counselling services are offered in all of the most commonly spoken

South African languages, which enhances the EAP service considerably.

The EAP services have been well received by a diverse range of Mintek

callers, who are all aware of the multilingual nature of the service and are

comfortable making use of it.

DIVERSITY

The Employment Equity and Diversity Forum which represents all

categories of employees, endeavours to create an environment which

embraces diversity and employment equity. By nurturing diversity and

eliminating equity barriers, while conforming to legislation and best practice,

the Forum strives to ensure that Mintek’s environment is conducive to

meeting strategic and operational goals. The Forum will consult with

management as well as staff with regard to, amongst others matters, the

new Employment Equity Plan 2009.

In the past year, the Forum has actively increased the awareness of

appreciating differences across the organisation. This was initiated

and implemented through a series of activities, beginning with the

short project called “In someone else’s shoes”, which was aimed at

increasing understanding of how people with disabilities have to

function within a work environment.

The Forum, in collaboration with the HIV/AIDS Committee, also

supported the orphans at the Itireleng Home in Soweto.

SAP AND HUMAN RESOURCES

Phase 1 of the SAP HR module, including payroll administration,

year. Phase 1 comprised the upload, set-up and training of all

users, as well as the piloting of the system. It is anticipated that

Mintek will implement Phase II of the SAP HR Module in the new

HUMAN CAPITAL DEVELOPMENT

Staff

Mintek has been actively developing its human capital in order

to be able to compete effectively in the development of its

intellectual property. A total of 335 staff members, as well as an

additional 57 non-permanent members of staff, received diverse

training and development interventions.

Bursary programme and scholarships

Parliamentary Grant, supported 41 undergraduate and 37

supported 44 trainees by providing on-site in-service training to

enable students at universities of technology to complete their

compulsory one year of practical experience. Ten scholarships were

also awarded to students at universities of technology.


Pics from top to bottom:The Mining

Authorityalso supports six graduates completinga one-year internship at Mintek.Pics 2 and 3: Mintekpartici-pates in the Technology and Human Resources for Industry Programme (THRIP), an initiative of the Depart-ment of Trade and Industry adminis-tered by the NationalResearch Foundation.

Mintek hosted a group of girl-learnersfrom schools in and around the greater Johannesburg area as part of the na-tional “bring-a-girl-childto-work” day.

The aim of the bursary programme is primarily to meet the

skills needs of Mintek’s operating technical divisions, and also

to provide appropriately-skilled graduates to the broader South

African minerals and metallurgy sector, as per Mintek’s Mission

Mintek’s bursary programme.

Mintek’s collaboration with the University of Cape Town (UCT)

has led to the awarding of a UCT/Mintek Prestige Scholarship,

granted on the basis of academic merit to a doctoral student

Mintek.

The Department of Science and Technology (DST) funds two

initiatives at Mintek. The Research Professional Development

Programme, comprising eight Fellows at postgraduate level,

aims to address the accelerated development of a group of

poised to contribute to the South African innovation platforms as

Internship Programme, involving seven graduates, aims to provide

valuable practical experience at Mintek to graduates over the course

supports six graduates completing a one-year internship at Mintek.

Where possible, Mintek offers permanent employment to outstanding

interns at the end of their training period.

Mintek participates in the Technology and Human Resources for Industry

Programme (THRIP), an initiative of the Department of Trade and Industry

administered by the

National Research

Foundation. The

programme aims to

promote increased

interaction and

diffusion of technology

between industry, higher

education institutions,

and science, engineering

and technology institutions,

and to provide an enhanced

educational experience

through customised participation by students in collaborative projects. Three of

Mintek’s divisions - Advanced Materials, Hydrometallurgy, and High-temperature

Technology - make extensive use of this programme as a means to conduct

commercially-focused research and development while at the same time exposing

students to industry-relevant activities.

Promoting the engineering profession to girl learners

Mintek hosted a group of girl-learners from schools in and around the greater

Johannesburg area as part of the national “bring-a-girl-child-to-work” day.

In addition, Mintek hosted a number of secondary schools on tours of its facilities during

the course of the year.


Pics from top to bottom:Minquiz is South Africa’s premier national science competitionfor Grade 12 learners.Learnersattendingthe Gauteng events were given tours of Mintek’s divisionaloperations.A total of 60 schools from all nine of South Africa’s provinces took competition.MinquizFinalists 2006.

Science, engineering and technology (SET) awareness and promotions

Mintek participated in various SET-promotion activities during the

course of the year based on its own awareness and promotion

programme, and also in collaboration with the DST and the Department

of Minerals and Energy (DME). The aim of such engagements is to

promote SET among the general public, and also to generate an interest

in SET-related careers among learners. Events included the DST’s INSITE

exhibition, the Sasol Techno-X exhibition, the DME’s Learner Focus Week,

the Sci-Bono Discovery Centre’s Careers Week, the Rand Easter Show, the

National Science Week, and many university open days.

Adopt-a-School

Kwadedangendlale High School

in Zola North, Soweto, in 2003,

and following the success of

this initiative, extended the

programme to the Itirele-Zenzele

Comprehensive High School at

Waterford Farm, Hartebeespoort,

and Ferndale High School in

Randburg. These schools are

assisted with facilities such as

teaching aids, library facilities,

and computer and laboratory

equipment, with the aim of

improving the teaching of

mathematics and science.

Students are also exposed

to “hands on” science-

related activities during

visits to Mintek, including Mintek’s exciting annual Minquiz

competition.

Minquiz

Minquiz is South Africa’s premier national science competition

for Grade 12 learners. The competition aims to encourage

and to promote an awareness of the importance of minerals

to South Africa. Minquiz started as a local competition for

schools located close to Mintek in 1988, and due to the

popularity of the competition this has now become a national

event.

Mintek aims to continually enhance the prestige and

awareness of the event. About 350 schools from all of South

were given tours of Mintek’s divisional operations. A total of

team-building exercises as well as a motivational talk, directed at

encouraging and motivating both learners and educators.

“Mintek attributes its position as one of the world’s leaders in mineral and metallurgical technology to its workforce of highly skilled engineers, scientists and technologists, who have been developing groundbreaking technologies, products and services for the local and international mining and minerals industries since 1934.”


PUBLICATIONS

1 April 2006-31 March 2007

Abdel-Latif M. Pilot Plant Demonstration of the Mintek Thermal Magnesium Process (MTMP). Proceedings of the International Symposium on Magnesium Technology in the Global Age. Conference of the Metallurgist, Montreal, Quebec, Canada, 1-4 October 2006.*

Barker IJ, Rennie, MS, Hockaday CJ, Brereton-Stiles PJ.Measurement and Control of Arcing in a Submerged-arc Furnace. XI International Conference on Innovations in the Ferro Alloy Industry (Infacon XI), Delhi, 18-20 Feb 2007. pp 685-694.*

Barkhuizen D, McPherson J and Van der Lingen E. Catalysis of the CO Oxidation Reaction by Au/TiO

2, Au/Al

2O

3 & Au/ZnO. Conference:

Catalysis Society of South Africa 2006, Mossel Bay, November 14-20 (2006).

Basson J. Curr TR and Gerricke WA. South Africa’s Ferro Alloys Industry: Present Status and Future Outlook. XI International Conference on Innovations in the Ferro Alloy Industry (Infacon XI), Delhi, 18-20 Feb 2007. pp 4-24.*

Bennett C, Knoblauch J, Foggo C, Strobos PJJ, Van der Spuy

Automation of the Kimberley Nickel Mine Flotation Operation using an Advanced Control System. Metallurgical Plant Design and Operating Strategies (MetPlant 2006), Perth, Australia, 18-19 September 2006.

Bis[bis(diphenylphosphino)ethane]rhodium(I) tetraphenylborate. Acta

Cryst. (2006), E62, m101–m102.*

Introduction of Phosphine-

Part of Solid Phase Peptide Synthesis. Z. Naturforsch. (2007), 62b, pp 460 – 466.*

Butyldiphenylphosphine oxide. Acta Cryst. (2007), E63, pp 1032–1033.*

B. cis-1,2-Bis(diphenylphosphino)ethylene Oxide. Acta Cryst. (2007), E63, pp1387-1389.

Gold (I) Complexes of Cys-Enkephalin. GOLD2006: New Industrial Applications for Gold, Limerick, Ireland, 2-8 September (2006).*

KineticMonte Carlo Simulation of Gold Nanoparticle Growth. GOLD2006: New Industrial Applications for Gold, Limerick, Ireland, 2-8 September (2006).*

Nucleation and Growth of Gold Nanoparticles on Graphite. GOLD2006: New Industrial Applications for Gold, Limerick, Ireland, 2-8 September (2006).*

Experimental and Computational Investigation of Gold Nanoparticle Growth on Graphite. GOLD2006: New Industrial Applications for Gold, Limerick, Ireland, 2-8 September (2006).*

HG. Crystalising gold(I), gold(II) and gold(III) with tetrahydrothiophene. OATA, August (2006), Cape Town, South Africa.

, New Pt-based Alloys for High Temperature Application in Aggressive Environments: The Next Stage. “Platinum Surges Ahead”, 2nd International Platinum Conference, Sun City, 8

– 12 October 2006. South African Institute of Mining and Metallurgy,

Symposium Series S45, pp 57-66.*

Cornish LA, Süss R, Building

a Database for the Prediction of Phases in a Pt-based

Superalloys. “Platinum Surges Ahead”, 2nd International

Platinum Conference, Sun City, 8 – 12 October 2006.

South African Institute of Mining and Metallurgy,

Symposium Series S45, pp 91-102.*

JH. Crystal Structure Changes in Pt-based Superalloys

During in-situ Heating, Microscopy Society of Southern

Africa Conference, Volume 36, p. 8, Port Elizabeth, 28

November – 1st December (2006).

D, Cornish LA. Unexpected Ordering Behaviour of

Pt3Al Intermetallic Precipitates, J. Alloys Compounds

432 (2007) 96–102.*

Iron Redox-Equilibria and Sulphide Capacity of PGM

Smelter-type Slags. Miner. Eng. vol. 19 (2006). pp.

212-218.

J. Critical Assessment of the Quartz Crystal

Microbalance with Dissipation as an Analytical

Tool for Biosensor Development and Fundamental

Studies: Metallo phthalocyanine-Glucose Oxidase Bio-

Composite Sensors, Biosensors Bioelectronics (2007)

in press.*

The

First Tetrazolylidene Complexes of gold(I), ICCC Cape

Town, South Africa, August (2006).

Utilisation

of Various Bonding modes of N-rich Heterocycles in gold(I)

chemistry, OATA, Town, South Africa, August (2006)

Utilisation

of Various Bonding Modes of N-rich Heterocycles in gold(I)

Chemistry, GOLD2006: New Industrial Applications for Gold,

Limerick, Ireland, September (2006).*

Gericke M. SPL8: Application of Biotechnology in the Mining

and Metallurgical Industries. 14th Biennial Congress of the South

African Society for Microbiology.

Glaner L. Cornish, LA and Joja B. The 1000 deg C Isothermal

Section of the Ni-Pt-Ru phase diagram, Microscopy Society of

Southern Africa Conference, Volume 36, p. 9, Port Elizabeth, 28

November – 1 December (2006).

Green BR.

Alternative Flow Sheets Determined by Ore characteristics.

Uranium Africa 2007. 28 –30 March 2007, Balalaika, Sandton.

Hewer R, Vorster J, Steffens FE, Meyer D. 1H NMR-based

Metabolic Disorders in HIV Positive / AIDS Patients. IUBMB, Kyoto,

Japan, June (2006). Paper no. 5P-B-195,

Jones RT and Curr, TR. Pyrometallurgy at Mintek. Southern African

Pyrometallurgy Conference 2006, South African Institute of Mining

and Metallurgy, Johannesburg, 5-8 March 2006, pp 127-150. 2006.*


McEwan JJ, Scott M and Goodwin FE. The Optimisation of

Hexadecanethiol Coatings to Improve the Tarnish Resistance of

Sterling Silver. South African Institute of Mining and Metallurgy, 8th

International Corrosion Conference, Saxonwold, Johannesburg, 14-

15 November 2006.*

McEwan JJ, Scott M and Goodwin FE. Coatings to Retard the

Formation of Tarnish on Silver and Silver Alloys. South African Institute

of Mining and Metallurgy, 8th International Corrosion Conference,

Saxonwold, Johannesburg, 14-15 November 2006.

Dramatic

Promotion of Gold/titania for CO Oxidation by Sulphate Ions. Chem.

Commun., (2007), pp 1044-1046.*

Effects of Incorporation

of Ions into Au/TiO2 Catalysts for Carbon Monoxide Oxidation Topic

Catal., 44, (2007), pp. 167-172.*

The Synthesis

and Characterization of Gold/polymer Composites. GOLD2006: New

Industrial Applications for Gold, Limerick, Ireland, 2-8 September

(2006).*

Mugonda M. The Socio-economic Implications of Mine Closure - A

South African and Zimbabwean Scenario. First International Seminar

on Mine Closure, Perth, Australia, 13-15 September 2006 and at Hard

Rock 2006 conference, Sustainable Modern Mining Applications,

Tucson, Arizona, USA, 14 Nov 2006.

Muwila A and Papo MJ. A More Corrosion Resistant Hercules(TM)

Alloy South African Institute of Mining and Metallurgy, 8th International

Corrosion Conference, Saxonwold, Johannesburg, 14-15 November

2006.*

Using SLASH to Improve Agricultural

Productivity in the Greater Marble Hall Area. A Presentation of the

Work in Progress. International Coal Ash Conference, CSIR, Pretoria,

2-4 Oct 2006 and The First All-Africa Technology Diffusion Conference,

Birchwood Hotel, Benoni, 12-14 June 2006.*

Soil Properties and Processes

Driving the Leaching of Nitrate in the Forested Catchments of the

Eastern Escarpment of South Africa. 2006. Forest Ecol. Mgmt. J.

Characterisation of Pt-rich Alloys in the Pt-Al-Nb system. Microscopy

Society of Southern Africa Conference, Volume 36, p. 11, Port

Elizabeth, 28 November – 1 December (2006).

A Study of the Ternary Phases in the Pt-Al-Ru system. Microscopy

Society of Southern Africa Conference, Volume 36, p. 12, Port

Elizabeth, 28 November – 1 December (2006).

Paul RL. Gold Research to Industrial Products (AuTek). GOLD2006:

New Industrial Applications for Gold, Limerick, Ireland, 2-8 September

(2006).*

Independence Platinum

Limited (IPt) - Formation and Objectives. “Platinum Surges Ahead”,

2nd International Platinum Conference, Sun City, 8th – 12th October

2006. South African Institute of Mining and Metallurgy, Symposium

Series S45, 231-236, (2006).*

Reinecke IJ and Lagendijk. H. A Twin Cathode DC Arc Smelting

Test at Mintek to Demonstrate the Feasibility of Smelting FeNi from

Calcine Prepared from Siliceous Laterite Ores from Kazakhstan for

Oriel Resources PLC. XI International Conference on Innovations in

the Ferro Alloy Industry (Infacon XI), (2007). pp 781-797.*

Kriel FH and Van Rensburg CEJ. 6-

Thioguanine Derivatives as Potential Anti-Cancer Agents, GOLD2006:

New Industrial Applications for Gold, Limerick, Ireland, 2-8 September

(2006).*

Jourdan PP. Links with Domestic Industry, Downstream Processing and the Provision

of Inputs. Resource based industrialisation in South Africa, Mozambique, March 2006.

Kalala JT. and Hinde AL. Development of Improved Laboratory and Piloting Test Procedures

at Mintek for the Design of AG/SAG Milling Circuits. In: Mular et al., Editors, Proceedings of

International Autogenous and Semiautogenous Grinding Technology 2006. vol. IX, pp 222-239, CIM,

Vancouver, Canada.*

Khanye DS, Caddy J, Layh M. Gold(I) Phosphine Complexes Incorporating Alkyl Substituents with Ethane and Ethylene Backbones. Gold Bull., (2007), 40 (1),pp45-51.*

Khanye DS, Caddy J, Layh M, Marques HM, and

Fernandes MA. Gold(I) Phosphine Complexes Incorporating Alkyl Substituents with Ethane and Ethylene Backbones. GOLD2006: New Industrial Applications for Gold, Limerick, Ireland, 2-8 September (2006).*

Kriel FH, Layh M, Caddy J and Fernandes. M.A.

SAAWK (Suid Afrikaanse Akademie vir Wetenskap en Kuns) Studentesimposium 2006, University of the North West, Potchefstroom, Nov (2006).

Kriel FH, Caddy J, Layh M, Marques HM and

Fernades MA. Gold(I) Phosphine Complexes Incorporating a Hydrazine Bridge. GOLD2006: New Industrial Applications for Gold, Limerick, Ireland, 2-8 September (2006).*

Luckos, A. Denton, G and Den Hoed P.

Current and Potential Applications of Fluid-bed Technology in the Ferroalloy Industry. XI International Conference on Innovations in the Ferro Alloy Industry (Infacon XI), Delhi, 18-20 Feb 2007. pp. 124-132.*

Cornish LA, Chown LH and Süss R.

Hot Corrosion Behaviour of Pt-alloys for Application in the Next Generation of Gas Turbines. “Platinum Surges Ahead”, 2nd International Platinum Conference, Sun City, 8th – 12th October 2006. South African Institute of Mining and Metallurgy, Symposium Series S45, pp 81-90, (2006).*

R. Synthesis and Characterisation of Dialkyl Tin Bis(diphenylphosphino)-Maleic Acid Adducts, the Molecular Structure of Two Polymorphs. J.

Organometall. Chem. (2006), pp 691,717.*

Marsland S. Importance and Method of Using Reference Materials in Measuring

Reliability of Analytical Results and Why Customers Should Use Them. South African Institute of Mining and Metallurgy,

23-24 November 2006. Vol. 107 February 2007.pp 75-78.

Surface Chemistry and Electrocatalytic Behaviour of Tetra-Carboxy

Substituted Iron, Cobalt and Manganese Phthalocyanine Monolayers on Gold Electrode.

Electrochim. Acta (2007) accepted.*


Development of an Effective

Method for Inoculation of Heap Leach Operations. South African

Microbiology Society Congress (SASM 2006), CSIR, Pretoria, 10-12

April 2006.

Slabbert GA and McEwan JJ.

the SMME Industry, 1st All Africa Technology Division Conference, 12-

14 June. pp. 1-13. Tshumisano Trust, June (2006).

Advancements and Applications in Milling Control.

SAIMM/SACAC Colloquium: State of the Art of Automation and

Control in the Metals and Minerals Processing Industries. Rand Water

Board, Rietvlei, SA, 2006.

. Investigation of As-Cast

Alloys in the Pt-Cr-Ru System. J. Alloys Compounds, 416 (2006) pp.

80-92 2006.*

Süss R and Cornish LA. Microstructural Evolution in the Pt-Al-Cr

System. Microscopy Society of Southern Africa Conference, Volume

36, p. 14, Port Elizabeth, 28th November – 1st December (2006).

Traut T, The Application

of Synchrotron Radiation Techniques in the Development of Novel

Gold-Based Anti-HIV Compound. Science@Synchrotron: Cape Town,

February 2007.

Tshikhudo TR. Monolayer Protected Clusters (MPCs) of Gold

and Silver: Preparation and Potential Bio-Analytical Applications.

NanoAfrica Conference, Cape Town, South Africa, 29 November, 2006

and Nanotrends Conference, Midrand, South Africa, 19-21 February,

(2007).*

Tshikhudo RT, Brennan JL, Wang Z and Brust M. Development

Applications. GOLD2006: New Industrial Applications for Gold,

Limerick, Ireland, 2-8 September (2006).*

Tshikhudo RT, Brennan JL, Wang Z and Brust M. Engineering

of Easily Functionalised Water-soluble Gold Monolayer Protected

Clusters (MPCs) for Potential Bioanalytical Applications,

GOLD2006: New Industrial Applications for Gold, Limerick,

Ireland, 2-8 September (2006).*

Van Hege, B, Van Tonder, D, Bell R, Wyethe J and Kotze M.

Recovery of Base Metals Using MetRIX(TM). Conference:

Alta 2006, May, 2006, Perth, Australia (2006).*

Van Staden PJ. Progress at Mintek in Heap Bioleaching.

Proceedings of HydroCopper 2007, IV International

Copper Hydrometallurgy Workshop, 16-18 May 2007,

Viña del Mar, Chile. Menacho, J.M. and Casas De

Prada, J.M. (eds.), pp 17-22.*

Watson A, Cornish LA and Suss R. Development of

a Database for the Prediction of Phases in Pt-based

Superalloys: Cr-Pt-Ru. Rare Metals, Vol.25 No. 5,

October 2006.*

Bidentate Amino- and Iminophosphine Ligands in

Mono- and Dinuclear Gold (I) Complexes: Synthesis,

structures and AuCl displacement by AuC6F5. Inorg.

Chem. Comm. (2007), 10, pp 358-342.*

MA, Layh M, Coyanis M and Van Rensburg CEJ.

Determination of the Biodistribution of Au-compounds

(intended as potential chemotherapeutics) by the

Use of Radiolabelled Tracers - Imaging in Pre-clinical

& Clinical Drug Development. Boston, USA March

2007.

* These papers were peer-reviewed.


ANNUAL

FINANCIAL STATEMENTS

FOR THE YEAR ENDED

31 MARCH 2007

CONTENTS

Corporate Governance.......................................................................52

Audit Committee Report.....................................................................55

Directors’ Report.................................................................................57

Report of the Auditor-General .............................................................59

Statements of Financial Position.........................................................62

Statements of Financial Performance..................................................63

Cash Flow Statements.........................................................................64

Statements of Changes in Net Assets.................................................65

Notes to the Annual Financial Statements...........................................66


CORPORATE GOVERNANCE

Mintek is committed to the principles of openness, integrity and accountability in

its dealings with all stakeholders. It endorses the Code of Corporate Practices and Conduct as set out in

the King Report and the Public Finance Management Act, and believes that the primary objective of the

corporate governance system is to ensure that the Board and Management carry out their responsibilities

faithfully and effectively.

BOARD OF DIRECTORS

Mintek’s Board of Directors consists of one executive member and eight non-executive members who

are independently appointed by the Minister of Minerals and Energy in terms of the Mineral Technology

three years, but are eligible for re-appointment. The Board members are chosen for their business

acumen and skills, and bring individual judgement to Board decisions. The Board Secretary is

responsible for ensuring that Board procedures are followed.

The Board met twice to review Mintek’s operational performance and to address issues of strategic

importance.

Table 1. Attendance of Board Members at Board Meetings

Name Jul

2006

Dec

2006

Mr. Mzilikazi Godfrey Khumalo (Chairman) Y Y

Mr. Morake Abiel Mngomezulu Y Y

Dr. Frank Crundwell Y N

Prof. Phuti Esrom Ngoepe Y N

Dr. Nozibele Pauline Mjoli N N

Ms. Gugu Mthethwa Y Y

Mr. Ralph Havenstein Y Y

Mr. Vinogaren Pillay Y N

Note: All the above are non-executive members

Y: Attended meeting. N: Did not attend meeting. A: Alternate attended meeting.

AUDIT COMMITTEE

The Audit Committee meets quarterly. It consists of one Board member and two independently appointed

non-executive members. The Committee operates in terms of a formal charter, and assists the Board in

appropriate accounting policies, internal controls and compliance with laws and regulations are in place. Both

the internal and external auditors have unrestricted access to the Audit Committee.

During the past year, the Committee considered various reports from the internal auditor, as well as the audit report

of residual lives/values of assets, asset impairment and revenue recognition. For the year ended 31 March 2007, the

the South African Statements of Generally Accepted Accounting Practice (GAAP).

Table 2. Attendance of Audit Committee Members at Audit Committee Meetings

Name Apr

2006

Jul

2006

Sep

2006

Nov

2006

Dr. Frank Crundwell (Chairperson) Y Y Y Y

Ms. Gugu Mthethwa (alternate) Y Y Y Y

Mr. Vinogaren Pillay (alternate) Y Y Y Y

Mr. Pieter Taljaard Y Y Y Y

Mr. Tofara Dube Y Y Y Y

Y: Attended meeting. N: Did not attend meeting.


INTERNAL CONTROL

Mintek maintains internal controls and systems designed to provide reasonable assurance as

accountability of assets. The effectiveness of these controls is monitored by the internal auditors,

who report to the Audit Committee. The Audit Committee has requested management to review and

evaluate Mintek’s existing internal controls to identify areas that can be improved upon.

INTERNAL AUDIT

Mintek’s independent Internal Audit (IA) function has been established in-house and has been capa-

assists Mintek to accomplish its objectives by adopting a systematic, disciplined approach to evaluate

and improve the effectiveness of risk management, control and governance processes. The IA function

has direct access to the Audit Committee.

RISK MANAGEMENT

risks facing the organisation. The Committee provides the Audit Committee with a risk assessment report

at appropriately scheduled intervals. Mintek utilises the services of insurance brokers on an annual basis

to analyse and assess the risks associated with Mintek’s assets, which are insured, together with public

liability and professional indemnity, for the risk assessed.

Table 3. Attendance of Corporate Risk Management Committee at Board Meetings

Name Sep

2006

Mar

2007

Dr. Roger Paul (Chairman and GM representing technology activities) Y Y

Mr. Vimlan Govender (Business and GM representing corporate services) Y Y

Mr. Nick Maritz (Site services and facilities) Y Y

Ms. Hester Pretorius (Finance) Y Y

Ms. Salwa Duyver (Human Resources) Y Y

Dr. Dave Hulbert (Information Technology) Y Y

Mr. Doctor Gule (Information Technology) Y Y

Mr. Hennie Venter (Secretary and QES) Y Y

Mr. Afzal Patel (Security) Y Y

Mr. Jaques Fourie (Internal Audit) Y Y


HUMAN RESOURCES COMMITTEE

three members of Mintek’s Executive Management. The Committee reviews and determines

the remuneration and terms of employment for Mintek, and as part of this process, gives

consideration to the annual review of remuneration packages based on independent

surveys. The Committee also looks into HR policies, internal controls, circumstances,

conditions and activities that affect material changes to policies and procedures and

conditions of service for all employees and compliance with demands and vested interests of

Table 4. Attendance of Human Resources Committee Members at Human Resources

Committee Meetings

Name Jul

2006

Dec

2006

Mr. Morake Abiel Mngomezulu N Y

Dr. Frank Crundwell N N

Prof. Phuti Esrom Ngoepe N N

Dr. Nozibele Pauline Mjoli Y N

Ms. Gugu Mthethwa N Y



FRAUD COMMITTEE

Mintek has instituted a fraud prevention plan that incorporates principles contained in the Public Sector Anti-

Corruption Strategy, and which focuses particularly on creating awareness and promoting ethical business

conduct. The Fraud Committee, which consists of standing members with roles in Finance and Security as

well as a neutral Chairperson, is tasked with an ongoing review of the effectiveness of internal controls.

MANAGEMENT

Mintek is managed by a CEO assisted by four General Managers. Together, they make up Mintek’s

Executive Management team, which meets on a regular basis to review strategic and operational issues.

Executive Management is supported by 16 formally appointed divisional managers who are in charge of

Mintek’s operating divisions and centralised support functions.

OPERATIONAL PERFORMANCE

Mintek reports to the Department of Minerals and Energy (DME) and is also accountable to the

Department of Science and Technology (DST) for its Research and Development (R&D) and

organisational, innovation and learning, human resources and transformation perspectives, determined

by the National Council for Innovation (NACI), provide Mintek with a basis for evaluating its activities.

should the need arise.

Mintek’s Executive Committee meets on a weekly basis and the Management Committee convenes

November and presented at the December Board meeting for approval.

GOING CONCERN

SAFETY, OCCUPATIONAL HEALTH AND ENVIRONMENTAL MANAGEMENT

As a responsible corporate citizen, Mintek acknowledges its obligation to its employees and the communities

it serves to conform in its operations to safety, health and environmental laws and the internationally accepted

standards and practices.


AUDIT COMMITTEE REPORT

The Audit Committee has adopted appropriate formal terms of reference, which have

reference.

In undertaking its responsibilities, the Audit Committee has reviewed the following:

• The effectiveness of the internal control systems;

• The effectiveness of the internal audit function;

• The risk areas of the entity to be covered in the scope of the internal and external audits;

users of such information;

• Compliance with legal and regulatory provisions;

• The activities of the internal audit function;

• The independence and objectivity of the external auditors; and,

• The scope and results of the external audit function.

The Audit Committee is also responsible for:

• Reporting to the Mintek Board and the Auditor-General where the report implicates any members of

the accounting authority in fraud, corruption or gross negligence;

• Communicating any concerns it deems necessary to the Mintek Board;

• Encouraging communication between members of the Mintek Board, senior executive

management, the internal auditors and the external auditors;

• Conducting investigations within the terms of reference;

• Concurring with the appointment of the in-house internal audit function;

• Approving the internal audit work plan; and,

• Setting the principles for recommending the use of the external auditor for non-audit

services.

during the year under review and that these controls have functioned effectively during

the period. The Audit Committee considers Mintek’s internal controls and systems to be

appropriate in all material respects to:

• Reduce the entity’s risks to an acceptable level;

• Meet the business objectives of the entity;

• Ensure the entity’s assets are adequately safeguarded; and,

• Ensure that the transactions undertaken are recorded in the entity’s records.

statements for the year ended 31 March 2006 due to non-compliance of generally accepted

accounting practice in the determination of residual lives/values of assets, asset impairment

and revenue recognition. The audit opinion expressed stated that, except for the effect of

balance sheet date.


management and supported by the Auditor-General:

• The accounting policies and standard operating procedure were reviewed during the course of 2006 and

updated to comply with South African Statements of Generally Accepted Accounting Practice (GAAP).

and is expected to improve the respective internal audit control and reporting measures.

undertaken and the appropriate skills have been sourced from other service providers to ensure that the

accounting recording and reporting issues will be resolved in the short term.

Fraud and theft amounting to R2.9 million was detected ranging from February 2006 to June 2007.

A forensic audit was performed to quantify the full extent of the loss. The employees in question are

loss that Mintek suffered. Full disclosure of this was made under note 34 in the Annual Financial

Statements.

March 2007 and concluded that they fully comply, in all material respects, with the requirements of the

Public Finance Management Act, 1999 (Act No. 1 of 1999), as amended, and GAAP.

The Audit Committee has requested management to review and evaluate Mintek’s existing internal

controls to identify areas that can be improved upon.

The Audit Committee agrees that the adoption of the going concern premise is appropriate in preparing the

which will provide a sound basis for Mintek to meet its obligation to its stakeholders. The Audit Committee

Mr. M Mphomela – Chairman of the Audit Committee

Dated: 31 August 2007

Audit Committee Members:

Dr. PP Jourdan

Dr. J Bredell

Ms. L Mhlabeni

Ms. FG Mthethwa

Mr. S Sikhosana


DIRECTORS’ REPORT

The directors take pleasure in submitting their report and the Annual Financial Statements for the year ended 31 March 2007.

PROFILE

Mintek is incorporated as a public company in South Africa in terms of the Companies Act, 1973, as amended, and is listed as a national government business enterprise in schedule 3B of the Public Finance Management Act (PFMA), 1999, as amended.

The Board of Directors acts as the accounting authority in terms of the PFMA.

FINANCIAL RESULTS

Mindev, for the year 31 March 2007.

REPORTING STANDARDS

The Mintek Group’s Annual Financial Statements comply with South African Statements of Generally Accepted Accounting Practice and the PFMA.

ORGANISATIONAL STRUCTURE

Mintek’s organisational structure is shown on page 8 of the annual report.

PRINCIPAL ACTIVITIES

Mintek, South Africa’s national mineral research organisation, is an autonomous statutory organisation established to ensure the sustainability and growth of the minerals industry through technology development and transfer. In terms of its mandate under the Mineral Technology Act 30 of 1989, Mintek’s major goals are:

• to contribute to wealth creation and poverty alleviation; and,

• to develop the requisite human capital to sustain the mining and minerals sector.

developing competitive and innovative processing technology and equipment;

• strengthening South Africa’s international position as a supplier of mineral technologies, capital goods and services; and,

• developing regional strategies for the mineral processing sector, concentrating on value-addition, capacity-building and broad-based development.

FINANCIAL AFFAIRS

Review of operations

Revenue

million compared to the previous year.

• The increase is due mainly to growth in commercial and earmarked income. This growth can be attributed to Mintek having adopted a strong commercial focus with an aggressive marketing effort and the commodities boom.


Assets

Capital Expenditure

Capital expenditure for the year amounted to R19.3 million (2006: R19.8 million). The Group disposed of assets with

a net book value of R0.4 million during the year under review.

Property

The reassessment of the useful life of all assets resulted in a reversal of R21 063 of previous year’s excess

prior to 2005/2006.

Investments

During the year under review, the Group disposed of its entire shareholding in Mogale Alloys (Proprietary)

Limited for a consideration of R33 million inclusive of a loan amount of R7 million. This amount is payable in

two installments by 30 April 2008.

JUDICIAL PROCEEDINGS

The directors are not aware of any judicial proceedings against Mintek.

POST BALANCE SHEET EVENTS

February 2006 to June 2007 amounting to R2.9 million. The employees in question are no longer in the

suffered. Full disclosure was made in Note 34 of the Annual Financial Statements.

SUBSIDIARIES

Annual Financial Statements.

THE DIRECTORS OF MINTEK

Dr. PP Jourdan

Mr. MG Khumalo – Chairperson

Mr. MA Mngomezulu

Dr. F Crundwell

Prof. PE Ngoepe

Ms. FG Mthethwa

Mr. R Havenstein

Mr. VP Pillay

Dr. NP Njoli

Mr. TY Dube

Mr. P Taljaard

As at 1 March 2007, the newly appointed directors of Mintek are:

Mr. H Motaung – Chairperson

Ms. FG Mthethwa

Mr. R Havenstein

Mr. S Sikhosana

Mr. M Ntilane

Ms. L Mhlabeni

Dr. J Bredell

Mr. M Mphomela

Dr. B Sehlapelo

The secretary of Mintek is Ms. V Moonsamy, and her business and postal addresses are as follows:

200 Hans Strijdom Drive Private Bag X3015

Randburg Randburg

2125 2125


REPORT OF THE AUDITOR-

GENERAL

REPORT OF THE AUDITOR-GENERAL TO PARLIAMENT ON THE GROUP FINANCIAL

STATEMENTS AND PERFORMANCE INFORMATION OF THE COUNCIL FOR MINERAL

TECHNOLOGY (MINTEK) FOR THE YEAR ENDED 31 MARCH 2007.

REPORT ON THE FINANCIAL STATEMENTS

Introduction

and other explanatory notes, as set out on pages 62 to 84.

statements in accordance with SA GAAP and in the manner required by the Public Finance Management

Act, 1999 (Act No. 1 of 1999) (PFMA) [Auditor-General Audit Circular 1 of 2005 and the Companies Act of

South Africa] Mineral Technology Act, 1989 (Act No.30 of 1989). This responsibility includes:

• designing, implementing and maintaining internal control relevant to the preparation and fair

error ;

• selecting and applying appropriate accounting policies; and,

• making accounting estimates that are reasonable in the circumstances.

Responsibility of the Auditor-General

As required by section 188 of the Constitution of the Republic of South Africa, 1996 read with

section 4 of the Public Audit Act, 2004 (Act No. 25 of 2004) and section 12(2) of the Mineral

Technology Act, 1989 (Act No.30 of 1989), my responsibility is to express an opinion on these

I conducted my audit in accordance with the International Standards on Auditing and General

Notice 645,647 and 648 of 2007, issued in Government Gazette No. 29919 of May 2007 on

PFMA or unlisted entities as applicable and General Notice 646 of 2007, issued in Government

Gazette No. 29919 of May 2007 on auditing of performance information. Those standards

require that I comply with ethical requirements and plan and perform the audit to obtain

An audit involves performing procedures to obtain audit evidence about the amounts and

statements, whether due to fraud or error. In making those risk assessments, the auditor

statements in order to design audit procedures that are appropriate in the circumstances, but not

for the purpose of expressing an opinion on the effectiveness of the entity’s internal control.

An audit also includes evaluating the:

• appropriateness of accounting policies used;

• reasonableness of accounting estimates made by management; and,


Basis of accounting

Opinion

ended, in accordance with Generally Accepted Accounting Practices (GAAP) and in the manner required by the PFMA

and Companies Act of South Africa and the Mineral Technology Act, 1989 (Act No.30 of 1989).

Emphasis of Matter

Without qualifying my audit opinion, I draw attention to the followiing matter:

contributed to these incidents.

Other Matters

Internal control

Various standard operation procedures were not complied with thereby compromising the internal control environment.

Furthermore, the following monitoring controls were not always adhered to:

• Certain incompatible duties were not always segregated.

documents were processed.

• Creditors reconciliations were not performed.

Material non-compliance with applicable legislation

• Contrary to the requirements of section 28 of the Value Added Tax Act, 1991 (Act No 89 of 1991), Value Added

Tax (VAT) returns for the periods April to October were only submitted to SARS at the end of October 2006.

Consequently fruitless and wasteful expenditure amounting to R263 019 as disclosed in note 34 of the AFS was

incurred.

• Property, plant and equipment was understated by R6 446 055 for the current year and R11 433 757 was

processed.

• Intangible assets were understated by R 4 260 735 and were not separately disclosed as required by IAS 38 (AC

129).

• Investment Property was not revalued at year-end as required in line with the accounting policy adopted by

management. As a result the balance was adjusted by R2 941 266.

• Accounts receivable were not disclosed at fair value as required by IAS 21 (AC 112) resulting in an adjustment of

R443 382.

• Deferred income was understated by R669 545.

• Provisions were overstated by R3 782 698.

• Retained earnings were understated by R11 510 529 due to the revision of useful lives of property plant, and

equipment.

• Performance guarantees of R5 332 807 were not accounted for.


OTHER REPORTING RESPONSIBILITIES

Reporting on performance information

I have audited the performance information as set out on pages 14 to 16.

Responsibilities of the accounting authority

The accounting authority has additional responsibilities as required by section 55(2)(a) of the PFMA to ensure that

the public entity.

Responsibility of the Auditor-General

I conducted my engagement in accordance with section 13 of the Public Audit Act, 2004 (Act No. 25 of 2004) read

with General Notice 646 of 2007, issued in Government Gazette No.29919 of May 2007.

appropriate evidence about the performance information and related systems, processes and procedures. The

procedures selected depend on the auditor’s judgement.

reported below.

APPRECIATION

The assistance rendered by the staff of the Council for Mineral Technology during the audit is sincerely appreciated.

M.A Masemola

for Auditor-General

Johannesburg

31 August 2007

annual report 2007

FINANCIAL STATEMENTS AND NOTES 2007

2007 2006 2007 2006

Notes R R R R

2007 2006 2007 2006

Notes R R R R

Non-current assetsGROUP GROUP MINTEK MINTEK

Property, plant and equipment 11.1 142,338,891 142,639,489 142,338,891 142,639,489

Intangible assets 11.2 4,260,735 – 4,260,735 –

Investment property 12 11,776,682 8,835,416 11,776,682 8,835,416

Equity accounted investments 13 – 12,285,939 – –

Investment in subsidiary 14 – – 100 100

Long-term loans and advances 15 25,143,191 1,151,611 1,877,191 1,151,611

Total non-current assets 183,519,499 164,912,455 160,253,599 152,626,616

Current assets

Inventory 16 3,279,036 2,744,373 3,279,036 2,744,373

Loans and advances to subsidiary 14 – – 7,385,486 –

Trade and other receivables 17 84,224,481 46,227,992 63,920,923 47,920,700

Short-term investments 18 89,491,480 102,830,270 89,491,480 102,830,270

Cash and cash equivalents 30,522,665 30,937,858 30,522,665 30,937,858

Total current assets 207,517,662 182,740,493 194,599,590 184,433,201

Total assets 391,037,161 347,652,948 354,853,189 337,059,817

Equity

Non-distributable reserves 62,794,971 63,046,831 62,794,971 63,046,831

Retained earnings 180,849,632 159,935,184 145,178,332 141,922,781

Total equity 243,644,603 222,982,015 207,973,303 204,969,612

Liabilities

Non-current liabilities

22 62,700,000 61,235,000 62,700,000 61,235,000

Long-term creditors 23 1,351,778 1,792,727 1,351,778 1,379,915

64,051,778 63,027,727 64,051,778 62,614,915

Current liabilities

Loans and advances to subsidiary 14 – – – 8,277,896

Trade and other payables 19 41,105,245 27,324,092 40,592,573 26,878,280

Deferred income 20 24,666,118 21,674,053 24,666,118 21,674,053

Provisions 21 17,569,417 12,645,061 17,569,417 12,645,061

Current liabilities 83,340,780 61,643,206 82,828,108 69,475,290

Total equity and liabilities 391,037,161 347,652,948 354,853,189 337,059,817

Non-current assetsGROUP GROUP MINTEK MINTEK

Property, plant and equipment 11.1 142,338,891 142,639,489 142,338,891 142,639,489

Intangible assets 11.2 4,260,735 – 4,260,735 –

Investment property 12 11,776,682 8,835,416 11,776,682 8,835,416

Equity accounted investments 13 – 12,285,939 – –

Investment in subsidiary 14 – – 100 100

Long-term loans and advances 15 25,143,191 1,151,611 1,877,191 1,151,611

Total non-current assets 183,519,499 164,912,455 160,253,599 152,626,616

Current assets

Inventory 16 3,279,036 2,744,373 3,279,036 2,744,373

Loans and advances to subsidiary 14 – – 7,385,486 –

Trade and other receivables 17 84,224,481 46,227,992 63,920,923 47,920,700

Short-term investments 18 89,491,480 102,830,270 89,491,480 102,830,270

Cash and cash equivalents 30,522,665 30,937,858 30,522,665 30,937,858

Total current assets 207,517,662 182,740,493 194,599,590 184,433,201

Total assets 391,037,161 347,652,948 354,853,189 337,059,817

Equity

Non-distributable reserves 62,794,971 63,046,831 62,794,971 63,046,831

Retained earnings 180,849,632 159,935,184 145,178,332 141,922,781

Total equity 243,644,603 222,982,015 207,973,303 204,969,612

Liabilities

Non-current liabilities

22 62,700,000 61,235,000 62,700,000 61,235,000

Long-term creditors 23 1,351,778 1,792,727 1,351,778 1,379,915

64,051,778 63,027,727 64,051,778 62,614,915

Current liabilities

Loans and advances to subsidiary 14 – – – 8,277,896

Trade and other payables 19 41,105,245 27,324,092 40,592,573 26,878,280

Deferred income 20 24,666,118 21,674,053 24,666,118 21,674,053

Provisions 21 17,569,417 12,645,061 17,569,417 12,645,061

Current liabilities 83,340,780 61,643,206 82,828,108 69,475,290

Total equity and liabilities 391,037,161 347,652,948 354,853,189 337,059,817

STATEMENTS OF FINANCIAL POSITION AT 31 MARCH 2007

PP JOURDAN V GOVENDERCEO, Mintek General Manager, Mintek Corporate ServicesRandburg, 31 August 2007

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63

STATEMENTS OF FINANCIAL PERFORMANCE FOR THE YEAR ENDED 31 MARCH 2007STATEMENTS OF FINANCIAL PERFORMANCE FOR THE YEAR ENDED 31 MARCH 2007

Notes

2007

R

2006

R

2007

R

2006

R

Continuing operations GROUP GROUP MINTEK MINTEK

Revenue 2 299,145,738 256,514,904 297,453,030 257,296,154

Cost of sales 3 (269,593,895) (242,161,677) (269,590,775) (242,161,677)

29,551,843 14,353,227 27,862,255 15,134,477

Other operating income 4 10,411,752 18,162,113 10,571,654 18,224,316

828,669 (81,735) 828,669 (81,735)

Investment income 5 12,463,899 9,817,025 12,043,342 9,817,025

Finance expenses 6 (526,035) (597,395) (457,487) (502,814)

Audit fees 7 (1,518,846) (1,924,160) (1,414,526) (1,884,479)

Fees for services 8 (26,856,271) (11,999,983) (26,268,410) (11,999,983)

Depreciation 9 (14,884,848) (10,640,635) (14,884,848) (10,640,635)

Loss on disposal of property, plant and equipment (387,313) (1,131,011) (387,313) (1,131,011)

28.2 13,483,971 (653,037) – –

10 (4,889,645) (12,828,438) (4,889,645) (12,828,438)

13 9,400,750 2,645,536 – –

27,077,926 5,121,507 3,003,691 4,106,723

Taxation 26 (6,415,338) (330,241) – –

20,662,588 4,791,266 3,003,691 4,106,723

Notes

2007

R

2006

R

2007

R

2006

R

Continuing operations GROUP GROUP MINTEK MINTEK

Revenue 2 299,145,738 256,514,904 297,453,030 257,296,154

Cost of sales 3 (269,593,895) (242,161,677) (269,590,775) (242,161,677)

29,551,843 14,353,227 27,862,255 15,134,477

Other operating income 4 10,411,752 18,162,113 10,571,654 18,224,316

828,669 (81,735) 828,669 (81,735)

Investment income 5 12,463,899 9,817,025 12,043,342 9,817,025

Finance expenses 6 (526,035) (597,395) (457,487) (502,814)

Audit fees 7 (1,518,846) (1,924,160) (1,414,526) (1,884,479)

Fees for services 8 (26,856,271) (11,999,983) (26,268,410) (11,999,983)

Depreciation 9 (14,884,848) (10,640,635) (14,884,848) (10,640,635)

Loss on disposal of property, plant and equipment (387,313) (1,131,011) (387,313) (1,131,011)

28.2 13,483,971 (653,037) – –

10 (4,889,645) (12,828,438) (4,889,645) (12,828,438)

13 9,400,750 2,645,536 – –

27,077,926 5,121,507 3,003,691 4,106,723

Taxation 26 (6,415,338) (330,241) – –

20,662,588 4,791,266 3,003,691 4,106,723

annual report 2007


CASH FLOW STATEMENTS FOR THE YEAR ENDED 31 MARCH 2007

GROUP MINTEK

2007 2006 2007 2006

Notes R R R R

Cash receipts from customers 178,018,488 180,821,671 178,018,488 180,638,217

Parliamentary grant received 118,664,000 108,880,000 118,664,000 108,880,000

Cash paid to suppliers and employees (294,510,679) (276,272,026) (282,646,376) (275,412,646)

Cash generated from operations 28 2,171,809 13,429,645 14,036,112 14,105,571

Payment of taxation 26 (3,689,088) – – –

Investment income 12,826,322 9,817,025 12,405,765 9,817,025

Finance costs (526,035) (337,424) (457,487) (242,843)

Long term creditor payments (985,622) (595,696) (523,622) (133,697)

Provisions utilised 21 (894,508) (5,783,361) (894,508) (5,783,361)

8,902,878 16,530,189 24,566,260 17,762,695

Additions to property, plant and equipment (19,274,096) (19,823,232) (19,274,096) (19,823,232)

Decrease/(increase) in investment deposits 13,338,790 (1,150,757) 13,338,790 (1,150,757)

(Cash advanced to)/receipts from subsidiary – – (15,663,382) 16,767,494

41,880 3,616 41,880 3,616

Proceeds from disposal of associate 28.2 – 18,000,000 – –

Post-retirement health care payments 22 (3,424,645) (3,022,438) (3,424,645) (3,022,438)

(9,318,071) (5,992,811) (24,981,453) (7,225,317)

Net (decrease)/ increase in cash

and cash equivalents 28.1 (415,193) 10,537,378 (415,193) 10,537,378

Cash and cash equivalents at beginning of year 30,937,858 20,400,480 30,937,858 20,400,480

Cash and cash equivalents at end of year 30,522,665 30,937,858 30,522,665 30,937,858

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65

STATEMENTS OF CHANGES IN NET ASSETS FOR THE YEAR ENDED 31 MARCH 2007

Non-

Distributable

Note Retained Earnings Reserve Total

R R R

GROUP

Balance at 31 March 2005 as previously reported 150,716,855 – 150,716,855

Restatements 4,427,063 – 4,427,063

Useful life adjustment 3,902,825 _ 3,902,825

Capitalisation of an asset received by way of donation at book value 524,238 _ 524,238

Restated Balance as at 31 March 2006 155,143,918 _ 155,143,918

Prior Year adjustments

5,072,300 – 5,072,300

Fair value adjustment (259,971) – (259,971)

Depreciation (21,063) – (21,063)

– 4,791,266

Revaluation of property 11 – 63,046,831 63,046,831

Restated Balance as at 31 March 2006 159,935,184 63,046,831 222,982,015

Land and Buildings 251,860 (251,860) –

20,662,588

Balance as at 31 March 2007 180,849,632 62,794,971 243,644,603

MINTEK

Balance at 31 March 2005 as previously reported 133,388,995 – 133,388,995

Restatements 4,427,063 – 4,427,063

Useful life adjustment 3,902,825 _ 3,902,825

Capitalisation of an asset received by way of donation at book value 524,238 _ 524,238

Restated Balance at 31 March 2005 137,816,058 – 137,816,058

Prior year adjustments

4,387,757

Fair value adjustment on trade debtors (259,971) – (259,971)

Depreciation (21,063) – (21,063)

– 4,106,723

Revaluation of property 11 – 63,046,831 63,046,831

Restated Balance at 31 March 2006 141,922,781 63,046,831 204,969,612

Land and Buildings 251,860 (251,860) –

3,003,691

Balance as at 31 March 2007 145,178,332 62,794,971 207,973,303

annual report 2007

the following principal accounting policies, which conform to South African Statements of General Accepted Accounting Practice, and in the manner

Rands (R). The accounting policies are consistent with those applied in the previous year, except for certain restatements and changes in accounting

policies.

1.1 Basis of consolidation

respectively.

1.2 Foreign currency transactions and balances

Foreign currency transactions are recorded at the exchange rate ruling at the date of the transaction.

At the balance sheet date, monetary assets and liabilities denominated in foreign currencies are translated into South African Rand at exchange

rates ruling at the balance sheet date. Exchange differences arising on the settlement of transactions at rates different from those at the date of

the transaction and unrealised foreign

Exchange differences on unsettled foreign currency monetary assets and liabilities, are recognised in the income statement and included in income

1.3 Investment in subsidiary

Foreign currency transactions are recorded at the exchange rate ruling at the date of the transaction.

At the balance sheet date, monetary assets and liabilities denominated in foreign currencies are translated into South African Rand at exchange

rates ruling at the balance sheet date. Exchange differences arising on the settlement of transactions at rates different from those at the date of the

transaction and unrealised foreign exchange differences on unsettled foreign currency monetary assets and liabilities are recognised in the income

1.4 Investment in associates

statements by using the equity method of accounting, from the effective dates of their acquisition until the effective dates of their disposal.

Investments in associates are carried in the balance sheet at cost as adjusted by post-acquisition changes in the group’s share of the net assets

of the associate, less any impairment in the value of individual investments. Losses of the associate in excess of the group’s investments in those

the associate at the date of acquisition is recognised according to the group’s accounting policies on goodwill. Where a group enterprise transacts

unrealised losses provide evidence of an impairment of the asset transferred.

1.5 Goodwill

entity at the date of acquisition. Goodwill is capitalised as an asset reviewed annually for impairment. At each balance sheet date goodwill is reviewed

carrying amount of goodwill is fully recoverable. An impairment charge is recognised to the extent that the carrying amount exceeds the recoverable

amount.

1.6 Intangible assets


NOTES TO THE ANNUAL FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2007

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1.7 Research and development costs

Expenditure on research activities is recognised as an expense in the period in which it is incurred.

An internally generated intangible asset arising from the Group’s research and development is recognised only if all of the following conditions are

met:

• The development cost of the asset can be measured reliably;

• It is technically feasible to complete the intangible asset so that it will be available for use or sale;

• The ability to use or sell the intangible asset; and,

• It is the intention to complete the intangible asset so that it will be available for use or sale.

Where no internally generated intangible asset can be recognised, development expenditure is recognised as an expense in the period in which it is

incurred. Internally generated intangible assets are amortised on a straight-line basis over their useful lives.

1.8 Impairment

of, then the recoverable amount is estimated and an impairment loss is recognised. Where it is not possible to estimate the recoverable amount for

an individual asset, the recoverable amount is determined for the cash-generating unit to which the asset belongs.

whether there is any indication that the assets may be impaired.

The recoverable amount is the higher of fair value less costs to sell and value in use. Value in use represents the present value of the future cash

Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of

its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had

no impairment loss been recognised for the asset (cash-generating unit) in prior years. A reversal of an impairment loss is recognised as income

immediately, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation

increase. Impairment losses for goodwill are not reversed in subsequent periods.

1.9 Leases

of the leases. Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease.

Capitalised leased assets are depreciated to their estimated residual values over their estimated useful lives. Finance lease payments are allocated

the liability to the lessor.

line basis over the term of the lease.

1.10 Property, plant and equipment

Properties comprise general purpose land and buildings held by the Group for its own use and investment property and buildings for purposes

of generating rental income or held for capital appreciation. Properties are initially valued at historical cost and subsequently revalued every two

appropriate.

The cost of property, plant and equipment includes all directly attributable expenditure incurred in the acquisition, establishment and installation of

67

annual report 2007



such assets so as to bring them to the location and condition necessary for it to be capable of operating in the manner intended by management.

Interest costs are not capitalised.

Depreciation is calculated so as to write off the cost of property, plant and equipment on a straight-line basis, over the estimated useful lives to the

estimated residual value. Useful lives and residual values are reviewed on an annual basis. Residual values are measured as the estimated amount

currently receivable for an asset if the asset were already of the age and condition expected at the end of its useful life.

expected useful lives on the same basis as owned assets or, where shorter, the term of the relevant lease. All assets under construction are carried

at cost and depreciation only commences once the asset is commissioned and ready for its intended use.

The gains and losses arising on the disposal or retirement of an item of property, plant, equipment and vehicles is determined as the difference

1.11 Investment property

professional valuer based on market evidence of the most recent prices achieved in arms length transactions of similar properties in the same

area.

1.13 Post-retirement health care costs

The Group uses the project unit credit actuarial method to determine the present value of its past service cost.

Actuarial gains and losses are recognised in full in the reporting period it relates to and is the excess over the greater of the present value of the

past service obligation at the end of the reporting period before deducting the present value of assumed assets at the same date. Valuations of these

obligations are carried out annually by independent actuaries using appropriate mortality tables, long-term estimates of increases in medical costs

and appropriate discount rates. General increases to medical aid contributions were estimated taking into account the projected future changes in

an increased estimated liability.

1.14 Inventories

Inventories are valued stated at the lower of cost or net realisable value. Costs comprise direct materials and, where applicable, direct labour costs

and those overheads that have been incurred in bringing the inventories to their present location and condition. Cost is calculated using the weighted

average method. Net realisable value represents the estimated selling price in the ordinary course of business less any costs of completion and costs

to be incurred in marketing, selling and distribution.

1.15 Provisions

The Group recognises its obligation for guaranteeing its product and services for periods as stipulated in its contracts with the Group’s customers.

The Group is exposed to certain environmental liabilities relating to its operations. Provision for the cost of environmental and other remedial work

such as reclamation costs, close down and restoration costs and pollution control is made when such expenditure is probable and the cost can be

reasonably estimated.

1.16 Financial instruments

Financial instruments recognised on the balance sheet include derivative instruments, investments, investments in debt securities, accounts

receivable, cash and cash equivalents, accounts payable and interest bearing debt. Financial instruments are initially measured at cost including

with in the subsequent notes. When the Group can legally do so and the Group intends to settle on a net basis, or simultaneously, related positive

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1.16.1 Derivative instruments

1.16.2 Investments

Investments consist of long-term money market instruments initially recorded at cost, which is the fair value of the cash placed with the institution.

Interest is accrued using the effective interest rate method and included in the income statement on an accrual basis.

1.16.3 Trade and other receivables

Trade and other receivables are stated at cost less an allowance for doubtful debts. The allowance raised is the amount needed to reduce the

1.16.4 Cash and cash equivalents

Cash and cash equivalents comprise cash on hand, demand deposits and investment in short-term money market instruments. The carrying amount

of cash is measured at its fair value.

1.16.5 Financial liabilities

Financial liabilities other than derivative instruments are amortised at their original debt value less principal payments and amortisation. Derivatives

are subsequently measured at fair value and gains and losses are included in the income statement for the period.

then the recoverable amount is estimated and an impairment loss is recognised in accordance with AC133. Financial Instruments and Recognition.

1.17 Government grants

recognised as income in the period in which it is received. These funds are utilised in accordance with a shareholders’ compact that is entered into

1.18 Revenue recognition

Revenue is recognised when the sale transactions giving rise to such revenue is concluded and risks and rewards of ownership and title pass

is recognised based on the percentage of completion determined by reference to the physical amount of work performed in relation to the total

project.

Advance income arising as result of contracts undertaken in terms of commercial work in respect of invoices raised and paid for in advance but for

which no substantial work has been made to justify the recognition of any revenue, is deferred until the income is earned based on the percentage

work completed.

Revenue arising from licence fees is recognised on an accrual basis in accordance with the terms of the applicable contracts. Revenue from royalties

is accrued-based on the nature of the applicable contracts.

Interest income is accrued on a time proportion basis recognisng the effective yield on the underlying assets.

Dividend income from investments is recognised when the right to receive payment has been established.

substance of the relevant agreements.

1.19 Contracts in progress

Where the outcome of a contract can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract

activity at the balance sheet date. The stage of completion is determined by the proportion of contract costs incurred in relation to the estimated total

contract costs. Variations in contract work, claims and incentive payments are included to the extent that they have been agreed to the customer.

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Where the outcome of the contract cannot be estimated reliably, contract revenue is recognised to the extent of contract costs incurred and probably

recoverable. Contract costs are recognised as expenses in the period in which they are incurred. When it is probable that total contract costs will

exceed total contract revenue, the expected loss is immediately recognised as an expense to the income statement.

deductible in other years and it further excludes items that are not taxable or tax deductible. The company’s liability for current tax is calculated using

tax rates that have been enacted or substantively enacted by the balance sheet date.

available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary differences

arise from the initial recognition (other than a business combination) of other assets and liabilities in a transaction that affects neither the taxable

Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries and associates, and interest in joint

ventures, except where the company is not able to control the reversal of the temporary difference and it is probable that the temporary difference

will not reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset realised. Deferred tax is

with in equity.

Deferred tax assets and liabilities are off-set when there is a legally enforceable right to set off current tax assets against current tax liabilities and

when they relate to income tax levied by the same taxation authority and the company intends to settle its current tax assets and liabilities on a net

basis.

Irregular expenditure means expenditure incurred in contravention of, or not in accordance with, a requirement of any applicable legislation,

including:

- The PFMA; or,

- Any provincial legislation providing for procurement procedures in that provincial government.

Fruitless and wasteful expenditure means expenditure that was made in vain and could have been avoided had reasonable care been exercised. All

irregular, fruitless and wasteful expenditure is charged against income in the period in which it is incurred.

1.22 Financing costs

Financing costs are recognised in the income statement in the period in which they are incurred.

this regard.

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GROUP MINTEK

2007 2006 2007 2006

R R R R

2. REVENUE

Government grants

State Grant 104,120,123 95,508,772 104,120,123 95,508,772

Less:

Grants received for projects started before year end but not completed – – – –

Add:

Grant received in prior year for projects completed this year – – – –

– – – –

Commercial income

Contract research 147,868,051 109,099,645 147,868,051 109,880,895

Manufactured products 6,281,941 11,659,357 6,281,941 11,659,357

Service income 27,627,810 32,331,773 27,627,810 32,331,773

Material sales 8,950,938 7,130,364 8,950,938 7,130,364

Royalty income 4,296,875 784,993 2,604,167 784,993

299,145,738 256,514,904 297,453,030 257,296,154

3. COST OF SALES

Staff costs 180,063,646 156,364,750 180,063,646 156,364,750

Consumables 35,276,814 33,921,978 35,276,814 33,921,978

General running expenses 44,177,053 45,277,850 44,173,933 45,277,850

Theft and fraud costs 1,800,579 – 1,800,579 –

Repairs and maintenance 8,273,802 5,847,596 8,273,802 5,847,596

Bad debts written off 6,066,250 – 6,066,250 –

Provision for bad debts (6,064,249) 749.503 (6,064,249) 749,503

269,593,895 242,161,677 269,590,775 242,161,677

4. OTHER OPERATING INCOME

Operating Income

Library services 141,114 137,913 141,114 137,913

Breach of contract 58,772 351,723 58,772 351,723

Bursary learnerships 1,526,281 3,895,852 1,526,281 3,895,852

Commission 467 26,651 467 26,651

Conferences 3,500 1,491,139 3,500 1,491,139

Mintek cafeteria 628,580 712,467 628,580 712,467

Sundry income 1,441,667 209,063 1,441,557 209,063

Bad debts recovered 6,000 4,168,421 6,000 4,168,421

Refund from Skills Development levies 162,984 – 162,984 -–

Other 80,269 137,889 240,171 200,092

4,049,634 11,131,118 4,209,536 11,193,321

Rental income - properties 1,959,640 1,604,068 1,959,640 1,604,068

Investment Property

Rental income 1,461,212 1,528,731 1,461,212 1,528,731

Fair value adjustment 2,941,266 3,898,196 2,941,266 3,898,196

4,402,478 5,426,927 4,402,478 5,426,927

10,411,752 18,162,113 10,571,654 18,224,316

5. INVESTMENT INCOME

Financial income

9,684,028 7,476,604 9,684,028 7,476,604

Loans to subsidiary – – 1,329,589 813,178

Loans to associates 1,329,589 813,178 – –

Interest earned: bank balances 333,281 822,553 333,281 822,553

Interest earned: staff debtors 200,898 704,690 200,898 704,690

Fair value interest on debtors 495,546 – 495,546 –

Long-term debtors 420,557 – – –

12,463,899 9,817,025 12,043,342 9,817,025

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annual report 2007


NOTES TO THE ANNUAL FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 MARCH 2007

6. FINANCE EXPENSES

Interest paid guaranteed liability 68,548 94,581 – –

Interest other 148 129,279 148 129,279

South African Revenue Services - interest and penalties 263,019 – 263,019 –

Fair value interest on debtors – 259,971 – 259,971

194,320 113,564 194,320 113,564

526,035 597,395 457,487 502,814

7. AUDIT FEES

Audit fees 1,375,658 1,083,000 1,325,658 1,050,000

Underprovided prior year 143,188 841,160 88,868 834,479

1,518,846 1,924,160 1,414,526 1,884,479

8. FEES FOR SERVICES

Consultants 25,141,713 11,287,396 24,553,852 11,287,396

Legal 1,714,558 712,587 1,714,558 712,587

26,856,271 11,999,983 26,268,410 11,999,983

9. DEPRECIATION

Buildings 577,199 325,339 577,199 325,339

Manufactured items 1,776,586 – 1,776,586 –

Plant 3,018,379 2,380,174 3,018,379 2,370,174

Equipment 8,426,722 7,409,759 8,426,722 7,409,759

Computer software 433,146 – 433,146 –

Vehicles 167,604 225,117 167,604 225,117

Low value assets 6,163 – 6,163 –

Leased assets 332,636 198,801 332,636 198,801

146,413 101,445 146,413 101,445

14,884,848 10,640,635 14,884,848 10,640,635

10. POST-RETIREMENT BENEFIT OBLIGATIONS

Actuarial loss - post-retirement medical obligation 3,645,790 8,729,894 3,645,790 8,729,894

Interest on post-retirement medical obligation 3,278,855 3,692,544 3,278,855 3,692,544

Actuarial (loss)/gain pension fund (2,035,000) 406,000 (2,035,000) 406,000

4,889,645 12,828,438 4,889,645 12,828,438

Number of employees 498 524 498 524

GROUP MINTEK

2007 2006 2007 2006

R R R R

72

annual report 2007


GROUP MINTEK

Opening Closing Opening Closing

Balance Additions Disposals Balance Balance Additions Disposals Balance

2007 R R R R R R R R

11.1 PROPERTY, PLANT

AND EQUIPMENT

Cost

Land 55,408,800 – – 55,408,800 55,408,800 – – 55,408,800

Buildings 28,859,940 66,167 – 28,926,107 28,859,940 66,167 – 28,926,107

Plant 32,578,228 2,107,171 (114,795) 34,570,604 32,578,228 2,107,171 (114,795) 34,570,604

Equipment 91,422,171 11,074,533 (9,170,246) 93,326,458 91,422,171 11,074,533 (9,170,246) 93,326,458

Vehicles 990,581 – (1) 990,580 990,581 – (1) 990,580

Finance-leased assets 1,995,394 317,250 – 2,312,644 1,995,394 317,250 – 2,312,644

Capital work in progress 1,462,886 862,239 – 2,325,125 1,462,886 862,239 – 2,325,125

214,670,339 14,580,215 (9,485,837) 219,764,717 214,670,339 14,580,215 (9,485,837) 219,764,717

Accumulated Opening Depreciation Disposals Closing Opening Depreciation Disposals Closing

Depreciation R R R R R R R R

Land – – – – – – – –

Buildings 9,760,176 577,199 – 10,337,375 9,760,176 577,199 – 10,337,375

Plant 12,627,878 3,018,379 (106,126) 15,540,131 12,627,878 3,018,379 (106,126) 15,540,131

Equipment 48,519,881 10,209,470 (8,773,619) 49,955,732 48,519,881 10,209,470 (8,773,619) 49,955,732

Vehicles 592,516 167,604 (1) 760,119 592,516 167,604 (1) 760,119

Finance-leased assets 198,801 332,636 – 531,437 198,801 332,636 – 531,437

Capital work in progress – – – – – – – –

72,030,851 14,451,701 (9,056,727) 77,425,826 72,030,851 14,451,701 (9,056,727) 77,425,826

GROUP MINTEK

2007 2007

Net book value R R

Land 55,408,800 55,408,800

Buildings 18,588,732 18,588,732

Plant 19,030,473 19,030,473

Equipment 43,370,726 43,370,726

Vehicles 230,461 230,461

Finance-leased assets 1,781,207 1,781,207

Capital work in progress 2,325,125 2,325,125

142,338,891 142,338,891


73

annual report 2007



GROUP MINTEK


Balance Additions Revaluation Disposals Balance Balance Additions Revaluation Disposals Balance

2006 R R R R R R R R R R

11.1 PROPERTY, PLANT

AND EQUIPMENT

Cost

Land 4,927,776 – 50,481,024 – 55,408,800 4,927,776 – 50,481,024 – 55,408,800

Buildings 16,266,961 27,172 12,565,807 – 28,859,940 16,266,961 27,172 12,565,807 – 28,859,940

Plant 32,795,382 413,341 – (630,495) 32,578,228 32,795,382 413,341 – (630,495) 32,578,228

Equipment 86,949,799 17,631,643 – (13,159,271) 91,422,171 86,949,799 17,631,643 – (13,159,271) 91,422,171

Vehicles 2,322,637 – – (1,332,056) 990,581 2,322,637 – – (1,332,056) 990,581

Finance-leased assets – 1,995,394 – – 1,995,394 – 1,995,394 – – 1,995,394

Capital work in progress 24,344 1,438,542 – – 1,462,886 24,344 1,438,542 – – 1,462,886

145,201,776 21,818,626 63,046,831 (15,396,894) 214,670,339 145,201,776 21,818,626 63,046,831 (15,396,894) 214,670,339

Accumulated Opening Depreciation Transfers Disposals Closing Opening Depreciation Transfers Disposals Closing

Depreciation R R R R R R R R R R

Land – – – – – – – – – –

Buildings 9,434,837 325,339 – – 9,760,176 9,434,837 325,339 – – 9,760,176

Plant 10,705,079 2,380,174 – (457,375) 12,627,878 10,705,079 2,380,174 – (457,375) 12,627,878

Equipment 53,101,894 7,409,759 180,511 (12,172,283) 48,519,881 53,101,894 7,409,759 180,511 (12,172,283) 48,519,881

Vehicles 1,470,673 225,117 – (1,103,274) 592,516 1,470,673 225,117 – (1,103,274) 592,516

Finance-leased assets – 198,801 – – 198,801 – 198,801 – – 198,801

Capital work in progress – – – – – – – – – –

75,211,974 10,640,635 180,511 (14,002,268) 72,030,851 75,211,974 10,640,635 180,511 (14,002,268) 72,030,851

GROUP MINTEK

2006 2006

Net book value R R

Land 55,408,800 55,408,800

Buildings 19,099,764 19,099,764

Plant 19,950,350 19,950,350

Equipment 42,902,290 42,902,290

Vehicles 398,065 398,065

Finance-leased assets 1,796,593 1,796,593

Capital work in progress 1,462,886 1,462,886

142,639,489 142,639,489

Freehold land and buildings comprise: GROUP AND MINTEK

2007 2006

R R

Acquired in the prior year - Land and Buildings 11,759,900 11,759,900

Land revalued 50,481,024 50,481,024

Buildings 12,565,807 12,565,807

Revaluation 74,806,731 74,806,731

Directors’ Valuation 74,806,731 74,806,731

Portion 175 and portion 226 of the farm Klipfontein, 203-IQ Johannesburg, with buildings thereon.

year ending 31 March 2006. The latest valuation report was issued on 7 February 2006.

The estimated useful life of depreciable property, plant, equipment and vehicles are as follows:

Buildings and investment property 50 years

Plant 10 years

Equipment 5 -10 years

Vehicles 5 years

74

annual report 2007


GROUP and MINTEK 2007 GROUP and MINTEK 2006


Balance Additions Revaluation Disposals Balance Balance Reversal Revaluation Disposals Balance

R R R R R R R R R R

11.2 INTANGIBLE

ASSETS

Cost

Computer software – 4,693,881 – – 4,693,881 – – – – –

– 4,693,881 – – 4,693,881 – – – – –

Current Year Current Year

Accumulated Opening Depreciation Revaluation Disposals Closing Opening Depreciation Revaluation Disposals Closing

depreciation R R R R R R R R R R

Computer software – 433,146 – – 433,146 – – – – –

– 433,146 – – 433,146 – – – – –

Value as at 31 March 2007 4,260,735 Value as at 31 March 2006 –

The estimated useful lives of depreciable intangible assets are as follows:

Computer software 3 years

GROUP and MINTEK 2007 GROUP and MINTEK 2006


Balance Reversal Revaluation Disposals Balance Balance Reversal Revaluation Disposals Balance

R R R R R R R R R R

12. INVESTMENT PROPERTY

Buildings - Billiton 8,835,416 – 2,941,266 – 11,776,682 7,190,526 (2,253,306) 3,898,196 – 8,835,416

8,835,416 – 2,941,266 – 11,776,682 7,190,526 (2,253,306) 3,898,196 – 8,835,416

FairValue as at 31 March 2007 11,776,682 Fair Value as at 31 March 2006 8,835,416

Portion of portion 175 of the farm Klipfontein, 203-IQ Johannesburg, with buildings thereon. The value of the building complex was estimated at R11 776 681 by

Lyons Financial Solutions (Proprietary) Limited, an independent valuer during the year ended 31 March 2007. The latest valuation report was issued on

18 June 2007.


75

annual report 2007



13. EQUITY ACCOUNTED INVESTMENTS

Details of associates are as follows:

Portion

Place of Portion of of voting Financial 2007 2006

Name of associate incorporation ownership power held year end R R

– 12,285,939

– 12,285,939

The Group disposed of its shareholding

in Mogale Alloys (Pty) Limited for an amount

of R33 000 000 effective 1 December 2006.

GROUP

2007 2006

R R

Cost of unlisted investments

Mogale Alloys (Proprietary) Limited – 250

Share of acquisition reserves: Mogale Alloys (Proprietary) Limited – 5,715,831

Fair value of net assets acquired – –

Interest bearing loans

Mogale Alloys (Proprietary) Limited – 6,569,858

– 12,285,939

Directors’ valuation – 12,285,939

Reconciliation between opening and closing balance:

Carrying value at the beginning of year 12,285,939 27,945,059

Loans to associates 14,039,561 678,622

Disposal of associate (33,000,00) (18,653,037)

9,400,750 2,645,536

Taxation (2,726,250) (330,241)

Carrying value at the closing of year – 12,285,939

Long-term assets – 108,138,022

Investment – –

Current assets – 78,390,473

Total Assets – 186,528,495

Current liabilities – 67,622,011

Long-term liabilities – 96,042,164

Total liabilities – 163,664,175

Income – 247,516,635

– 5,216,118

– 3,898,048

14. INVESTMENT IN SUBSIDIARY

Details of subsidiary are as follows:

Place of Portion of Financial Shares at cost Shares at cost Indebtness Indebtness

Name of subsidiary incorporation ownership year end 31 March 2007 31 March 2006 31 March 2007 31 March 2006

R R R R

Mindev (Proprietary) Limited 100 100 7,385,486 (8,277,896)

100 100 7,385,486 (8,277,896)

way of direct investments in equity and through joint ventures.

DISCONTINUED OPERATIONS: TOLLSORT (PROPRIETARY) LIMITED

Tollsort (Proprietary) Limited ceased its operations at the end of September 2004. Mindev (Proprietary) Limited has included the operating losses from Tollsort (Proprietary)

Limited. The total amount outstanding as at 31 March 2007 is R 1 726 692 and the amount recognised by Mindev (Proprietary) Limited as R432 173 at 31 March 2007.

76

annual report 2007



GROUP MINTEK 2007 2006 2007 2006 R R R R

15. LONG-TERM LOANS AND ADVANCES

LONG-TERM DEBTOR

PGR 17 investments (Proprietary) Limited 33,000,000 – – –

Less:

Short-term portion (Note 17) (16,500 000) – – –

16,500,000 – – –

LONG-TERM DEBTOR

Mogale Alloys (Proprietary) Limited 10,569,558 – – –

Less:

Short-term portion (Note 17) (3,803,558) – – –

6,766,000 – – –

STAFF LOANS

Advances to staff 3,070,751 1,979,876 3,070,751 1,979,876

Less:

Short-term portion of staff loans (Note 17) (1,193 560) (828,265) (1,193,560) (828,265)

1,877,191 1,151,611 1,877,191 1,151,611

25,143,191 1,151,611 1,877,191 1,151,611

Staff loans are granted to qualifying staff in terms of schemes approved by the Board of Mintek.

GROUP MINTEK 2007 2006 2007 2006 R R R R

16. INVENTORY

Consumables 1,626,776 1,625,333 1,626,776 1,625,333

Finished goods – 32,052 – 32,052

Contracts in progress 1,949,902 1,086,988 1,949,902 1,086,988

Inventories written off during the year (297,642) – (297,642) –

3,279,036 2,744,373 3,279,036 2,744,373

17. TRADE AND OTHER RECEIVABLES

Trade debtors 61,872,651 51,073,604 61,872,651 52,766,312

Short-term portion of long-term debtors (Note 15) 20,303,558 – – –

Short-term portion of staff loans (Note 15) 1,193,560 828,265 1,193,560 828,265

Other receivables 2,810,839 2,346,499 2,810,839 2,346,499

Less:

Provision for doubtful debts (1,956,127) (8,020,376) (1,956 127) (8,020,376)

84,224,481 46,227,992 63,920,923 47,920,700

18. SHORT-TERM INVESTMENTS

Short-term investments 89,491,480 102,830,270 89,491,480 102,830,270

GROUP MINTEK 2007 2006 2007 2006 R R R R19. TRADE AND OTHER PAYABLES

Trade creditors 32,283,410 10,782,867 32,283,410 10,782,867

Other payables 2,963,834 2,528,345 2,883,334 2,495,345

Current portion of lease creditor 283,126 221,785 283,126 221,785

Current portion of guaranteed liability 432,172 412,812 – –

SARS (VAT) 745,574 6,578,183 745,574 6,578,183

Other creditors and accruals 4,397,129 6,800,100 4,397,129 6,800,100

41,105,245 27,324,092 40,592,573 26,878,280

20. DEFERRED INCOME

Deferred income 20,463,394 18,917,629 20,463,394 18,917,629

Advanced client billing 4,202,724 2,756,424 4,202,724 2,756,424

24,666,118 21,674,053 24,666,118 21,674,053

Deferred income arises as a result of contracts undertaken in terms of the National Research Fund and Innovation Fund administered by the Department of

Science and Technology in respects of amounts received in cash not yet accounted for as revenue.

Advance client billing income arises as a result of contracts undertaken in terms of commercial work where invoices are raised based on work that has been done.

The quantum of cost incurred provides the basis for the level of revenue recognised in the period.

77

annual report 2007

21. PROVISIONS Opening Additional Utilised and Closing

Balance provisions reversed Balance

R R R R

GROUP AND MINTEK – 31 March 2007

Provision for leave pay 11,750,553 2,962 – 11,753,515

Product warranties 894,508 5,815,902 (894,508) 5,815,902

12,645,061 5,818,864 (894,508) 17,569,417

GROUP AND MINTEK – 31 March 2006

Provision for leave pay 12,873,411 – (1,122,858) 11,750,553

Provision for bonus 4,000,000 – (4,000,000) –

Product warranties 1,555,011 – (660,503) 894,508

18,428,422 – (5,783,361) 12,645,061

The provision for leave pay relates to vested leave pay to which employees become entitled upon leaving the employment of the entity. The provision

arises as employees render a service that increases their entitlement to future compensated leave. The provision is utilised when employees who are

entitled to leave pay, leave the employment of the entity or when the accrued leave due to an employee, is utilised.

The bonus accrual consists of a portion of the employees remuneration cost elected by the employee for payment annually in November each year.

The provision for product warranties is the entity recognising its probable liability for meeting its obligations in terms of products and services as

stipulated in its contracts with its customers.

GROUP MINTEK

2007 2006 2007 2006

R R R R

22. LONG-TERM RETIREMENT BENEFIT

Post-retirement medical aid 61,800,000 58,300,000 61,800,000 58,300,000

900,000 2,935,000 900,000 2,935,000

62,700,000 61,235,000 62,700,000 61,235,000

The amounts included in the balance sheet arising from Mintek’s

Present value of obligations as at 31 March 61,800,000 58,300,000 61,800,000 58,300,000

Fair value of plan assets as at 31 March – – – –

61,800,000 58,300,000 61,800,000 58,300,000

GROUP MINTEK

2007 2006 2007 2006

R R R R

Movement in the net-liability recognised in the balance sheet

58,300,000 48,900,000 58,300,000 48,900,000

Interest cost 3,278,855 3,692,544 3,278,855 3,692,544

Contributions paid to service providers (3,424,645) (3,022,438) (3,424,645) (3,022,438)

Net-actuarial loss recognised 3,645,790 8,729,894 3,645,790 8,729,894

61,800,000 58,300,000 61,800,000 58,300,000

Key assumptions

Expected long-term rate of return on plan assets 8.0% 8.0%

Expected increase in health care costs 6.5% 6.5%

Amounts recognised in income in respect of the scheme are as follows:

Current cost 6,924,645 12,422,438 6,924,645 12,422,438

Contributions paid 3,424,645 3,022,438 3,424,645 3,022,438

Expected average remaining life of employees (years) 16 16 16 16

Medical cover is provided through a number of different schemes.

Post-retirement medical cover in respect of qualifying employees is recognised as an expense over the expected remaining service lives of the relevant

These liabilities have been provided in full, calculated on an actuarial basis. The liabilities are unfunded. Periodic valuation of this obligation is carried

out by independent actuaries every two years, the latest one being 31 March 2007.



78

annual report 2007



GROUP MINTEK

2007 2006 2007 2006

R R R R

22. ( )

Movement in the net-liability recognised in the balance sheet

Employer liability 2,935,000 2,529,000 2,935,000 2,529,000

Movement in guaranteed liability – 400,000 – 400,000

Actuarial (gain)/loss (2,035,000) 6,000 (2,035,000) 6,000

Net-employer liability at end of year 900,000 2,935,000 900,000 2,935,000

Current cost (2,035,000) 406,000 (2,035,000) 406,000

At inception of the Fund a retirement reserve was allocated to certain members which will become payable at the time of the members death or with-

drawal. The employer also funds a minimum guaranteed pension for members who entered the fund as at 1January 1995.

Employer contributions are charged against income in the period in which they are incurred. Contributions so charged were as follows:

GROUP MINTEK

2007 2006 2007 2006

R R R R

MRF and MERF 8,267,727 8,814,634 8,267,727 8,814,634

Employee contributions to the funds were as follows:

MRF and MERF 4,400,771 4,863,246 4,400,771 4,863,246

2007 2006 2007 2006

Current service costs 6,924,645 12,422,438 12,668,498 13,677,880

Interest obligation 3,278,855 3,692,544 – 400,000

Actuarial loss/(gain) 3,645,790 8,729,894 (2,035,000) 6,000

Total included in employee costs 13,849,290 24 844,876 10,633,498 14,073,880

23. LONG-TERM CREDITORS

Finance lease obligation

Amoun 1,634,904 1,601,700 1,634,904 1,601,700

(283,126) (221,785) (283,126) (221,785)

1,351,778 1,379,915 1,315,778 1,379,915

Guarantee liability

Long-term liability 432,171 825,624 – –

Less: Current portion of long term liability (432,171) (412,812) – –

– 412,812 – –

1,351,778 1,792,727 1,351,778 1,379,915

23.1 FINANCE LEASE OBLIGATION

Capitalised leased assets

Payable within one year 283,126 221,785 283,126 221,785

Payable within 2-5 years 1,351,778 1,379,915 1,351,778 1,379,915

Net-lease liability 1,634,904 1,601,700 1,634,904 1,601,700

As of 31 March 2007 the aggregate amounts of minimum lease payments and the related imputed interest under capitalised lease contracts payable

Minimum Interest Present

lease value of minimum

payments lease payments

Payable in the years ended 31 March:

2008 464,078 180,952 283,126

2009 464,078 145,045 319,033

2010 444,858 103,003 341,855

2011 667,787 35,468 632,319

2012 59,157 586 58,571

2,099,958 465,054 1,634,904

79

annual report 2007



GROUP MINTEK

2007 2006 2007 2006

R R R R

23.2 GUARANTEED LIABILITY

Associate company liability 432,173 825,624 – –

Less: Current portion included in accounts payable (432,173) (412,812) – –

– 412,812 – –

The Group has assumed its share of the guaranteed liability of an associate company which will be repaid by 15 March 2008.

GROUP MINTEK

2007 2006 2007 2006

R R R R

24. FUTURE LEASE LIABILITY

Future operating lease charges for vehicles

- Payable within one year 195,353 362,672 195,353 362,672

195,353 544,008 195,353 544,008

- Payable within one year 102,370 – 102,370 –

294,237 – 294,237 –

396,607 – 396,607 –

25. CONTINGENT LIABILITIES

Legal liabilities

Mintek has various legal claims relating to disputed performance in sales and supply contracts. The amounts of the disputes are not expected to

exceed R 38 100. Mintek also has disputed employment termination contracts with former employees, the aggregate is not expected to exceed

R 233 867.

Guarantees

A cession in favour of ABSA for R 5 000 000 to meet requirements for credit card and other banking facilities has been registered.

GROUP MINTEK

2007 2006 2007 2006

R R R R

26. TAXATION

Taxation on entity share in associate post-acquisition reserves 2,726,250 330,241 – –

Capital gains taxation on disposal of shares in associate 3,689,088 – – –

6,415,338 330,241 – –

No deferred taxation is raised on the assessed losses of Mindev (Proprietary) Limited due to the uncertainty regarding taxable income to utilise the

assets in the foreseeable future.

No provision for income tax was made as Mintek is exempted in terms of section 10(1)(CA)(i) of the Income Tax Act, No. 58 of 1962.

Tax provision liabilities are with respect to Mindev and its associated companies and are payable through those entities.

GROUP MINTEK

2007 2006 2007 2006

R R R R

27. COMMITMENTS

Contracted for:

Capital expenditure 1,640,173 338,276 1,640,173 338,276

Authorised and not contracted for – – – –

1,640,173 338,276 1,640,173 338,276

Internal funds will be provided to meet the expenditure in respect of these commitments, which have been approved and contracted for.

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annual report 2007

28. CASH GENERATED FROM OPERATIONS

Notes

20,662,588 4,791,266 3,003,691 4,106,723

Adjusted for:

Investment income (12,826,322) (9,817,025) (12,405,765) (9,817,025)

Finance expenses 526,035 337,424 457,487 242,843

Non-cash items

Investment property fair value adjustment 4 (2,941,266) (3,898,196) (2,941,266) (3,898,196)

Depreciation 9 14,884,848 10,640,635 14,884,848 10,640,635

Fair value adjustment - debtors 362,423 (259,971) 362,423 (259,971)

Fixed asset correction – 180,510 – 180,510

387,313 1,131,011 387,313 1,131,011

(13,483,971) 653,037 – –

Provisions raised 20 5,818,864 – 5,818,864 –

Increase in post-retirement obligations 21 4,889,645 12,828,438 4,889,645 12,828,438

Share of associates’ income (9,400,750) (2,645,536) – –

Taxation in associates 6,415,338 330,241 – –

Increase in loan to associates (11,125,147) (678,622) – –

(1,692,709) – – –

Long-term liability raised 262,868 (142,335) 194,319 (221,785)

2,739,757 13,450,877 14,651,559 14,933,183

Working capital changes:

(Increase)/decrease in loans (725,580) 121,842 (725,580) 121,842

Increase in inventories (534,663) (671,502) (534,663) (671,502)

Increase in accounts receivables (16,000,223) (7,211,637) (16,000,223) (7,732,914)

Increase in payables 13,700,453 8,859,873 13,652,954 8,574,770

Increase/(decrease) in deferred income 2,992,065 (1,119,808) 2,992,065 (1,119,808)

(567,948) (21,232) (615,447) (827,612)

2,171,809 13,429,645 14,036,112 14,105,571

28.1 (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS

Cash on hand (11,222,531) 4,929,673 (11,222,531) 4,929,673

Cash on deposit 10,662,244 5,617,008 10,662,244 5,617,008

Foreign currency 145,094 (9,303) 145,094 (9,303)

(415,193) 10,537,378 (415,193) 10,537,378

28.2 DISPOSAL OF SHARE IN ASSOCIATE

Cost of investment 250 1,600 – –

Fair value at acquisition – 5,212,452 – –

Post-acquisition reserves 12,390,331 8,438,985 – –

Loans and advances 7,125,448 5,000,000 – –

Carrying value at disposal date 19,516,029 18,653,037 – –

Proceeds (33,000,000) (18,000,000) – –

(13,483,971) 653,037 – –



GROUP MINTEK

2007 2006 2007 2006

R R R R

81

annual report 2007



29. RESTATEMENTS AND RECLASSIFICATIONS

GROUP

Balance as

reported and error restated

R R R

Income statement

Fair value adjustment on debtors – 259,971 259,971

Depreciation 10,619,572 21,063 10,640,635

Balance sheet

Capital and reserves

Retained earnings at beginning of the year 150,716,855 4,427,063 155,143,918

Non-current assets

Property, plant and equipment 138,233,487 4,406,002 142,639,489

Trade and other receivables 46,487,963 (259,971) 46,227,992

Income statement

Finance expenses (337,424) (259,971) (597,395)

Depreciation (10,619,572) (21,063) (10,640,635)

Cash Flow

Cash generated from operations

5,072,300 (281,034) 4,791,266

Depreciation 10,619,572 21,063 10,640,635

Company reconciliation 2006

Income statement

Fair value adjustment on debtors – 259,971 259,971

Depreciation 10,619,572 21,063 10,640,635

Balance sheet

Capital and reserves

Retained earnings at beginning of the year 133,388,995 4,427,063 137,816,058

Non-current assets

Property, plant and equipment 138,233,487 4,406,002 142,639,489

Trade and other receivables 48,180,671 (259,971) 47,920,700

Income statement

Finance expenses (242,843) (259,971) (502,814)

Depreciation (10,619,572) (21,063) (10,640,635)

Cash generated from operations

4,387,757 (281,034) 4,106,723

Depreciation 10,619,572 21,063 10,640,635

Retained earnings

The entity restated retained earnings reversing depreciation as a result of a change in the estimated residual lives of the underlying assets. As a result

prior years’ depreciation was increased by R3 902 825 while capitalised equipment that was donated in prior years with a net book value of R524 238

accounts recievable .

Property, Plant and Equipment

The entity restated retained earnings reversing depreciation as a result of a change in the estimated residual lives of the underlying assets. As a result

prior years’ depreciation was decreased by R 3 902 825 while capitalised equipment that was donated in prior years with a net book value of R524 238

and the depreciation charge in F2006 increased by R21 063.

82

annual report 2007



30. INSURANCE AND RISK MANAGEMENT

earning capacity and legal obligations against acceptable losses.

31. FINANCIAL INSTRUMENTS

Credit risk

Financial assets that could subject the Group to credit risk consist principally of bank balances and cash, deposits, trade and other receivables

to associates are presented net of the allowance for doubtful receivables or loan write-offs. Credit risk with respect to trade receivables is limited due to the large number of customers comprising the Group’s customer base and their dispersion across different industries and geographic areas.

Interest risk

The valuation of interest rate exposure and investment strategies is done by management on a regular basis. Interest-bearing investments are held witn reputable banks to minimise exposure.

Fair value

As at 31 March 2007 the carrying amount of bank balances and cash, deposits, trade and other receivables, trade and other payables, contracts in progress, advances received and short term borrowing approximated their fair values due to the short-term natures of these assets and liabilities.

Foreign currency risk

currently enter into forward foreign exchange contracts to buy and sell amounts of various currencies at predetermined exchange rate, as the foreign

denominated in foreign currency. As a matter of principle, the Group does not enter into foreign currency exchange contracts for speculative reasons.

The estimated fair value gain/(loss) per income statement was determined by comparing the contracted value rate to an equivalent spot rate on the settlement or at year-end rate for outstanding foreign currency.

32. BOARD MEMBERS AND EXECUTIVE MANAGEMENT REMUNERATION

2007 2006

GROUP AND MINTEK R R

Entity Basic Salary Fees for Performance services as bonus and director other expenses TOTAL TOTAL

MINTEK

Dr. PP Jourdan Mintek 1,266,717 – 4,880 1,271,597 1,193,917

Dr. RL Paul Mintek 1,242,433 – 9,912 1,252,345 1,033,879

Dr. NA Barcza (Resigned) Mintek & Mindev – – – – 763,700

Dr. M Motuku Mintek 838,768 – 8,949 847,717 782,429

Mr. P Fusi Mintek 860,227 – – 860,227 828,478

Mr. V Govender Mintek 845,352 – 280 845,632 821,450

Ms. K Mzondeki (Resigned) Mintek – – – – 127,166

– 24,021 5,077,518 5,551,019

MINTEK

Mr. M Khumalo (Chairman) Metallon Corporation – 7,000 – 7,000 9,108

Dr F. Crundwell CM Solutions – 10,546 – 10,545 18,668

Ms.T Mosery-Eboka (Resigned Jan 2006) Standard Bank – – – – 1,691

Dr. NP Mjoli Hlathi Development – 2,976 – 2,976 15,286

Ms. L Mojela (Resigned December 2005) WIPHOLD – – – – 5,659

Mr. R Havenstein Anglo American Platinum – 5,198 – 5,198 6,764

Ms. G Mthethwa Standard Bank – 11,759 – 11,759 15,219

Mr. V Pillay CSIR – 5,621 – 5,621 12,423

Mr. P Taljaard – 6,889 – 6,889 –

Prof. PE Ngoepe University of the North – 1,268 – 1,268 10,146

Mr. TY Dube – 5,621 – 5,621 –

MINDEV

Mr. N Morrison Mindev – 1,690 – 1,690 3,382

Mr. G Mosinyi Mindev – – – – 5,073

5,053,497 58,568 24,021 5,136,086 5,654,438

83

annual report 2007

33. RELATED PARTY

Controlling entity

The Group comprises of Mintek and its wholly owned subsidiary Mindev (Proprietary) Limited. Mindev is engaged in the commercialisation of Mintek

and Tollsort (Proprietary) Limited. The Group, in the ordinary course of business, enters into various sale and purchase transactions on an arm’s length

basis at market rates with related parties.

indirect, in any transactions which has affected or will materially affect Mintek or its investment interest or subsidiaries.

Associates GROUP MINTEK

2007 2006 2007 2006

R R R R

During the year the Group advanced interest bearing loans to associates.

Interest bearing loans

Mogale Alloys (Proprietary) Limited – 6,569,858 – –

Apic Toll Treatment (Proprietary) Limited – – – –

Tollsort (Proprietary) Limited – 762,500 – 762,500

Tollsort (Proprietary) Limited ceased its operations at the end of September 2004.

Mindev’s portion of the loan guarantee made to Standard Bank on behalf of Tollsort (Proprietary) Limited.

Related party transactions

Related party transactions exist within the Group. During the year all selling transactions were concluded at arm’s length. Details of material

GROUP MINTEK

2007 2006 2007 2006

R R R R

Mintek sales to:

Department of Minerals and Energy 7,425,132 6,933,125 7,425,132 6,933,125

Department of Science and Technology 10,481,138 3,154,516 10,481,138 3,154,516

Mogale Alloys (Proprietary) Limited 2,604,167 6,250,000 2,604,167 6,250,000

Mindev (Proprietary) Limited – – 1,519,662 875,381

20,510,437 16,337,641 22,030,099 17,213,022

34. FRUITLESS AND WASTEFUL EXPENDITURE

Theft and fraudulent costs 1,800,579 – 1,800,579 –

2,063,598 – 2,063,598 –

The theft and fraud related to various incidents:

A staff member of Mintek produced fraudulent documentation on which payments to various suppliers were based. A total of R2 708 947 was paid

also here criminal proceedings were initiated.

The waste and fruitless expenditure was in repect of interest and penalties paid to SARS for the late payment of VAT, PAYE, SDL and UIF. The

35. CONTINGENT ASSETS

Mintek is covered by a Fidelity Guarantee Insurance policy, which covers theft of the company’s assets and a claim has been lodged for the possible

recovery of the stolen funds.

However, the possible outcome of the claim cannot be determined as the claim is still under review.

GROUP MINTEK

2007 2006 2007 2006

R R R R

1,800,579 – 1,800,579 –

36. EVENTS AFTER BALANCE SHEET DATE

Theft and fraud amounting to R1 800 579 was detected after the balance sheet date.

Details relating to this are disclosed in Note 34 under the subheading of theft and fraud.



84

CONTACTSInternal auditor Jacques Fourie 011-709 4796External auditors Auditor General (AG) 011-276 1800Company Secretary Ms Vanessa Moonsamy 011-709 4906

General Managers Contact NumberTechnology Dr Roger Paul 011-709 4934

Corporate Services Mr Vimlan Govender 011-709 4328Mineral Policy & Sustainable Development Mr Petrus Fusi 011-709 4779

Division Contact NumberAdvanced Materials Dr Elma van der Lingen 011-709-4471

Biotechnology Dr Tony Pinches 011-709 4397

Conferences & Events Mr Muzi Ntombela 011-709 4140 ? Engineering Support Mr Nick Maritz 011 709 4094

Estate Management Mr Muzi Ntombela 011 709-4140Finance Ms Hester Pretorius 011-709 4698

High Temperature Technology Mr Alan McKenzie 011-709 4736Human Resources Mr Muzi Ngcobo 011-709 4373Hydrometallurgy Dr Dave Hulbert 011-709 4382

– Bursars & SET promotions Mr Garth Williams 011-709 4476

– Library Ms Manil Kanniappen 011 709-4277 Information Technology Mr Doctor Gule 011-709 4282

Kgabane Ms Busi Ntuli 011-709 4034

Minerals Economics & Strategy Unit Mr Sodhie Naicker 011-709-4414Minerals Processing Mr Agit Singh 011-709 4339

Mineralogy Ms Amanda Quadling 011-709 4163Pyrometallurgy Mr Tom Curr 011-709 4642

Quality, Environment and Safety Mr Hennie Venter 011-709 4103

ACRONYMSAfDB – African Development Bank

AMI – Advanced Metals Initiative

AMP – African Mining Partnership

ASSM – Artisanal and Small-Scale Mining

BEE – Black Economic Empowerment

BioPAD – Biotechnology Partnership and Development

CASM – Communities and Small-Scale Mining

CDFR – Client Dissatisfaction Frequency Rate

CIL – Carbon-in-Leach

CIP – Carbon-in-Pulp

DC – Direct Current

DG – Disadvantaged Group

DME – Department of Minerals and Energy

DRC – Democratic Republic of Congo

DST – Department of Science and Technology

DTI – Department of Trade and Industry

EAP – Employee Assistance Programme

ERP – Enterprise Resource Planning

EU – European Union

GAAP – General Accepted Accounting Practice

GIS – Geographic Information System

HPGR – High Pressure Grinding Roll

IA – Internal Audit

ICMI – International Cyanide Management Institute

IFRS – International Financial Reporting Standards

KPI – Key Performance Indicators

LME – London Metal Exchange

LTIFR – Lost Time Injury Frequency Rate

MLA – Mineral Liberation Analyser

MQA

MESU – Mineral Economics and Strategy Unit

NACI – National Council for Innovation

NEPAD – New Partnership for Africa’s Development

NICICO – National Iranian Copper Industries Company

NMR – Nuclear Magnetic Resonance

NNR – National Nuclear Regulator

NRF – National Research Foundation

NUM – National Union of Mineworkers

PDI – Platinum Development Initiative

PFMA – Public Finance Management Act

PBC

PGMs – Platinum-Group Metals (platinum, palladium, ruthenium, rhodium, iridium, and osmium)

PLC – Programmable Logic Controller

PWG – Prime Western Grade (zinc)

QES – Quality, Environment and Safety

QEMSCAN – Qualitative Evaluation of Minerals by Scanning Electron Microscope

RBTS – Resource-Based Technology Strategy

R&D – Research and Development

REACH – Registration, Evaluation, Authorisation and Restriction of Chemicals

RIL – Resin In Leach

RIP – Resin In Pulp

RPP – Radiation Protection Programme

SADC – Southern African Development Community

SAG – Semi-Autogenous Grinding

SARM – South African Reference Material

SARS – South African Revenue Service

SCADA – Supervisory Control and Data Acquisition

SD – Sustainable Development

SETA – Skills Education Training Authority

SET – Science, Engineering, and Technology

SETI – Science, Engineering, and Technology Institute

SHG – Special High Grade (zinc)

SMMEs – Small, medium, and micro-enterprises

S&T – Science and Technology

THRIP – Technology and Human Resources for Industry Programme

UNECA – United Nations Economic Commission for Africa

WGC – World Gold Council

WAD – Weak Acid Dissociable (cyanide)

Specialists in mineral and metallurgical technology

200 Hans Strijdom Drive, Randburg 2194, South Africa

Telephone: +27 11 709 4111 Fax: +27 11 793 2413 www.mintek.co.zaProduced by the Information and Academic Support Division of Mintek

Printed by Remata iNathi Communications and Printers (Pty) Ltd.ISBN 978-0-621-37198-7

RP 109/2007

mintek annual report 2007...5 annual report 2007 mr mzi khumalo, chairman of board. chairman’s...

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