South Africa’s ilmenite is about to get a massive value boost after signing a deal with China. The signing of an engineering, procurement, and construction (EPC) contract for the long-awaited sulphuric acid titanium dioxide project has set the stage for a significant increase in the value of South African ilmenite. The project, spearheaded by Nyanza Light Metals CEO Donovan Chimhandamba, is expected to bring in an investment of $750 million. This project highlights the immense opportunity for Africa and South Africa to establish advanced material production companies that make competitive use of locally mined materials.
The signing of the EPC contract with East China Engineering Science and Technology Company (ECEC), a subsidiary of China National Chemical Engineering Group Company, has provided the confidence needed for the project’s funding. ECEC’s extensive experience in building plants in China over 60 years has bolstered the project’s credibility. This partnership is expected to pave the way for the production of titanium dioxide pigment in South Africa, potentially fetching ten times higher value than the current export market price of ilmenite.
The project aims to move Africa’s abundant raw materials up the value curve, with a focus on producing 80,000 tons per year of titanium dioxide pigment. This represents a significant portion of Africa’s buying capacity and over 1% of the global market. The widespread use of titanium dioxide in various industries, including coatings, cosmetics, medicine, electronics, and environmental protection, underscores the potential impact of this project.
The EPC signing breakthrough was achieved at the third Belt and Road Forum for International Cooperation in Beijing, highlighting the cooperation between Nyanza and China in advancing development in Africa. Nyanza plans to source its ilmenite locally from South Africa and is exploring opportunities to lower manufacturing costs by blending in stockpiled ilmenite-containing slag at Evraz, the former Highveld Steel and Vanadium, in eMalahleni, Mpumalanga.
The project also includes plans for self-generation of 12 MW of solar power supported by battery storage, as well as cogenerated electricity from the TiO2 pigment plant. Additionally, a product testing and development centre has been commissioned to provide 700 tons per year of TiO2 pigment samples to offtake partners.
Offtake agreements for more than 60% of the 80,000 tons per year capacity have already been signed, indicating strong market demand. The project has received funding from Africa Finance Corporation of Nigeria and African Export-Import Bank of Egypt, with a third multilateral international finance institution finalizing agreements. Construction is expected to begin next year, with financial close likely by year-end.
Nyanza’s CEO, Donovan Chimhandamba, has been the driving force behind this project, which aims to capitalize on South Africa’s abundance of raw materials. He emphasizes the need for Africa to move up the value curve and make competitive use of its resources. The project’s potential to reduce import costs and meet domestic demand for titanium dioxide pigment is a significant step towards achieving this goal.
Chimhandamba’s vision for Nyanza began 16 years ago, and the project’s journey has been marked by perseverance and strategic partnerships. The phased approach adopted by Nyanza, including the commissioning of a product testing and development centre, reflects a commitment to quality and customer confidence.
In conclusion, the Nyanza titanium dioxide project represents a significant opportunity for South Africa and Africa as a whole to capitalize on local resources and move up the value curve. The project’s potential to meet domestic demand and reduce import costs underscores its importance in the region’s economic development. With strong market demand and strategic partnerships, Nyanza is poised to make a substantial impact in the production of titanium dioxide pigment.