Rising commodity prices and black economic empowerment (BEE) were the main forces affecting SA's mining and resources companies over the past year.
This year will bring more of the same, particularly in BEE, where the practical application of new legislation is about to be tested. That's despite the five-year grace period in which companies can apply to exchange their existing "old order" mining rights for "new order" rights.
Both Harmony and AngloGold Ashanti have indicated they will apply for new rights as soon as possible. Gold Fields Ltd CEO Ian Cockerill, too, said at the presentation of the group's March quarterlies that Gold Fields was ready to apply as Tokyo Sexwale's BEE group Mvelaphanda Resources (Mvela) had taken a 15% equity stake in Gold Fields' SA mines.
Managements want to get the mining rights "risk" out of the way as fast as possible.
President Thabo Mbeki unfairly singled out Sasol for criticism last year, after the media reported on the group's filings with the Securities & Exchange Commission, in which BEE was included as one of the business risks it faced.
But all the SA companies listed on the New York Stock Exchange have filed similar statements, because the BEE process can pose risks, such as the possibility that the mining rights that are fundamental to their businesses may not be renewed.
International investors, who by now generally own the majority of the shares in SA's big mining groups, remain wary about BEE and have the advantage of being able to invest elsewhere.
What has been positive is the advances in good faith on both sides of the traditional divide between business and politics. AngloPlat chairman Barry Davison told the FM in April that "we realised that to prosper we had to change our attitude". He said that, in the 1990s, he and minerals & energy minister Phumzile Mlambo-Ngcuka had "talked a lot but did not listen to each other".
Mlambo-Ngcuka acknowledged that "business needs a climate to do business in and to do it with confidence. The idea is to have a sustainable industry, not one that commits suicide over empowerment. The mining charter is about expanding the mining industry, creating wealth responsibly and sharing it."
As the meeting of minds continues, SA executives will remain keen to get the rights issues out of their lives as soon as possible, to remove any investor uncertainty over the issue.
An important development is the growth of two leading BEE operations to the point where they have to be considered major players in the SA mining business scene.
These are Mvela and Patrice Motsepe's ARM group. Motsepe pulled off a huge deal when he negotiated the merger of gold company Harmony and his privately held platinum interests with Avmin, which has changed its name to ARM.
That has created the first truly BEE "mining house" listed on the JSE Securities Exchange. There is bound to be plenty of action from ARM over the next 12 months.
Mvela has lagged behind ARM but is building momentum fast, as shown by its success in raising R1,8bn from international investors to help fund the R4,1bn purchase of a 15% stake in Gold Fields' SA operations.
BEE aside, there are several other issues that will shape the future of the SA mining industry. The most important is the future of the rand.
That is the subject of a policy debate between government and the mining industry. Government has been telling the mines to get used to a strong rand. The mines' reply is that the strong rand is damaging their operations and government will not like the consequences of what they will have to do to cope.
Actions include the closure of high-cost shafts, resulting in the loss of yet more jobs, and the shelving of projects which would maintain or increase production in future, thus preventing job creation.
The strong rand has also increased the determination of various mining companies to diversify their operations out of SA into more favourable, "dollarised" mining countries such as Peru, Ghana and Russia. The key areas for expansion are platinum, iron ore and coal.
Coal is particularly important in relation to BEE. This is because small mining companies can set themselves up fairly easily in the coal mining business. But events of the past year have shown up severe deficiencies in government's role in aiding economic development through the provision and maintenance of the necessary national infrastructure.
Specifically, Spoornet, the parastatal that operates the country's railways, continues to underperform badly despite two years of complaints from the private sector and promises from government to fix the problems. Spoornet's lack of capacity to haul coal for export directly affects BEE because it prevents black mining companies from getting their production to Richards Bay and thence to foreign customers.
Much hope is being pinned on the future expansion of the Northern Cape iron ore business, where Anglo American is now the dominant player, having taken over Kumba Resources. Again, government has to come to the party by providing expanded rail and port handling infrastructure in good time.
