KEY POINTS
- Exxaro eyes the Tshipi manganese mine to reduce coal reliance.
- Tshipi’s 2022 output made it South Africa’s second-largest producer.
- The acquisition aligns with Exxaro’s diversification and growth strategy.
Exxaro Resources is making a bold move to diversify its mining portfolio. The Johannesburg-based coal producer is reportedly in talks to acquire the Tshipi Borwa manganese mine, one of South Africa’s largest manganese producers.
According to insiders familiar with the discussions, Exxaro has been in contact with Tshipi e Ntle Manganese Mining, the joint venture that owns the mine. The venture is co-owned by Jupiter Mines Ltd., listed on the Australian stock exchange, and South African-based Ntsimbintle Mining.
While the discussions are ongoing, sources warn that there’s no guarantee a deal will be finalized. Tshipi’s owners may explore other potential buyers for the high-value asset, according to one of the insiders.
If the acquisition goes through, it would mark a significant shift for Exxaro, which has been looking to reduce its reliance on coal. The company’s CEO, Nombasa Tsengwa, previously noted that manganese was a key target in its expansion plan.
“Exxaro is hard at work in the market, engaging potential targets in earnest,” a company spokesperson said, without confirming specific details about the Tshipi deal.
Why Exxaro is focusing on manganese for future growth
Exxaro’s shift toward manganese is strategic. The global demand for manganese is on the rise due to its role in steel production and its growing use in electric vehicle (EV) batteries.
While over 90 percent of manganese demand is tied to steel production, consultancy firm Project Blue estimates that demand for manganese in EV batteries will triple by 2040.
Given South Africa’s position as the world’s largest exporter of mid- to high-grade manganese ores, Exxaro sees an opportunity to capitalize on the resource.
By diversifying its portfolio beyond coal, the company can tap into new revenue streams as the world transitions toward cleaner energy solutions.
According to Mining Weekly, the Tshipi Borwa mine stands out as a high-potential acquisition target. In 2022 alone, the mine produced 3.3 million tons of manganese ore, making it South Africa’s second-largest producer.
This performance shows the strategic appeal of the mine for Exxaro, especially as global mining giants like Anglo American and African Rainbow Minerals continue to dominate the sector.
What a Tshipi acquisition would mean for Exxaro’s future
If Exxaro secures Tshipi, it would significantly alter the company’s long-term growth trajectory. The deal would reduce Exxaro’s dependence on coal—a goal the company has been pursuing for years as the world shifts toward greener energy sources.
Notably, Exxaro faced a setback last year when it lost out on a bid for a copper project in Botswana. With its sights now set on manganese, the company hopes to achieve a win this time around.
The potential acquisition comes amid broader changes within Exxaro’s executive leadership. Earlier this month, CEO Nombasa Tsengwa was suspended, raising questions about the company’s internal stability. However, the company stated that it remains committed to “a measured and responsible transition” from being a coal-dominated business.
If successful, the acquisition could position Exxaro as a serious player in the manganese market, allowing the company to better align with the global shift toward sustainable mining and green energy solutions.
