By: IOL

PIC Announces R1.35 Billion Fund for Early-Stage African Mining

The Public Investment Corporation (PIC), Africa's largest asset manager with over R3 trillion in assets, has allocated R1.35 billion to fund early-stage mining opportunities. This strategic move is designed to boost mineral exploration, support South Africa's Just Energy Transition (JET), and drive inclusive economic growth across the continent.

Strategic Investment Focus and Approach

The funding will target mining projects that are well-advanced but often face a funding gap, specifically those at the post-scoping to bankable feasibility study (BFS) stage. To mitigate the high-risk nature of these early-stage investments, the PIC will deploy capital indirectly through private equity, venture capital, specialist mining funds, and joint ventures. This approach aims to deliver attractive returns for the PIC's clients while supporting the growth of the mining sector.

The investment will be spread across a diversified portfolio, with a requirement that at least 50% of the funded projects be located within South Africa. The remaining allocation will be directed toward opportunities in other African nations with significant reserves of critical minerals, including Zambia, the Democratic Republic of Congo, Malawi, Tanzania, and Madagascar.

Target Commodities and Investment Criteria

The portfolio will focus on a range of critical and strategic minerals essential for the global energy transition. Target commodities include copper, cobalt, nickel, lithium, graphite, rare earth elements, tin, tungsten, and manganese, among others. Individual investments from the fund will range from R100 million to R400 million, subject to internal approvals.

Transformation is a core criterion for funding. South African businesses must have a Broad-Based Black Economic Empowerment (B-BBEE) Level 2 or higher, with a strong preference given to applications from Historically Disadvantaged Individuals (HDIs), including Africans, women, youth, and people living with disabilities. For projects elsewhere in Africa, the PIC will apply country-specific transformation policies.

Alignment with National and Developmental Goals

This initiative reinforces the PIC's commitment to responsible and sustainable investing. It is aligned with South Africa's national policy frameworks, such as the Exploration Strategy for the Mining Industry and the Critical Minerals and Metals Strategy. The funding aims to position South Africa as a leader in the global green energy shift by catalysing investment in "minerals of the future," expanding the pipeline of emerging miners, and enhancing the country's competitiveness in mineral beneficiation.

The PIC, which is wholly owned by the South African government and manages assets for public sector clients like the Government Employees Pension Fund, has a mandate to pursue development-focused projects. This mining fund is a direct application of that mandate, aiming to support the government's objective of creating a more inclusive, sustainable, and economically beneficial mining industry.