Exxaro Resources Ltd., one of South Africa’s largest coal producers, is setting its sights on becoming a key player in the country’s manganese mining sector. After missing out on acquiring a copper mine in Botswana last year, CEO Nombasa Tsengwa is now focusing on manganese as part of Exxaro’s strategy to diversify its operations. South Africa is the world’s leading exporter of mid- to high-grade manganese ores, primarily used in steel production.
Although Exxaro currently does not own any manganese mines, the company has expressed interest in acquiring projects, according to Tsengwa. Major players in the South African manganese industry include South32 Ltd., Anglo American Plc, and African Rainbow Minerals Ltd., with mining operations mainly concentrated in the Northern Cape province.
“We believe the manganese industry needs a South African champion,” said Tsengwa, adding that Exxaro is looking to acquire “a very good asset or two” and is also considering exploration opportunities.
The steel industry remains the largest consumer of manganese, accounting for 93% of demand, according to Tanisha Schultz, a senior research analyst at Project Blue. However, the demand for manganese in batteries, including those used in electric vehicles, is expected to triple to over 7% by 2040.
Founded in 2006 from a split of Anglo American’s coal, zinc, and titanium assets, Exxaro has already diversified into clean energy, including wind farms. The company is also eager to add copper to its portfolio, anticipating increased demand driven by electric vehicles, artificial intelligence, and renewable energy technologies. Exxaro reached the shortlist to acquire the Khoemacau copper mine in Botswana, but China’s MMG Ltd. secured the deal, paying $1.9 billion in November.
While Exxaro remains interested in copper mining, Tsengwa noted that these ventures would likely be pursued with partners due to high costs. The company is exploring opportunities in Botswana, the Democratic Republic of Congo, and Zambia for copper exploration.
Despite its diversification efforts, Exxaro remains a leading supplier of coal to South Africa’s state-owned power utility, Eskom Holdings SOC Ltd. In 2023, the company sold nearly 41 million tons of coal, with 13% of that volume exported. Exxaro could potentially export up to 10 million tons annually, but logistical challenges with state-owned rail and freight operator Transnet SOC Ltd. have hindered those efforts, according to Tsengwa.
