BE.Americas

ACHIEVING BUSINESS EXCELLENCE ONLINE INCLUDING

Goldcorp marlin mine AMERICAS EDITION Issue No.55

Puerto Rico Electric Power Authority camanchaca

Aggreko:

Power in place The world leader in temporary power solutions

business excellence

Business John O’Hanlon Editor johanlon@bus-ex.com Will Daynes Editor wdaynes@bus-ex.com Matt Johnson Art Director mjohnson@bus-ex.com Louise Culling Production Designer lculling@bus-ex.com Richard Turner Director of Sales rturner@bus-ex.com Vince Kielty Director of Editorial Research vkielty@bus-ex.com

Business Excellence brings you content from leading business influencers and strategic thinkers providing inspiration and guidance to help you and your business grow.

We showcase some of the best examples of successful organisations from around the world giving you a unique insight into how they operate.

Sharon Rooke Administration & Operations srooke@bus-ex.com Matt Day Head of Technology mday@bus-ex.com Andy Turner Chief Executive aturner@bus-ex.com

Contributors George F. Brown, Jr. Consultant & Author

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Dr. Bernard Meyerson VP of Innovation at IBM Esther McMorris Nine Feet Tall Stephen Archer Business Analyst

Subscriptions & Enquires info@bus-ex.com

Jacquard House, Queen Street, Norwich, NR2 4SX. England

Infinity Business Media Ltd

The content of this magazine is copyright of Infinity Business Media Ltd. Redistribution or reproduction of any content is prohibited. Š Copyright 2014 Infinity Business Media Ltd.

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issue no.55

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8 strategy

Signs of a Good Solution If a solutions strategy can enable a firm to stand out from its competitors the payoff can be considerable.

14 strategy

Right To The Top: Practical Project Management Advice For The C-Suite

14

As technology continues to improve, collaboration is driving executives together in ways never witnessed before.

20 Strategy

Positive pricing experiences

Take a proactive approach to pricing and turn online competition from a threat to an opportunity.

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contents

26

34

26 Innovation

Managing sustained innovation for a smarter planet

Extraordinary outcomes can be achieved when the right people, infrastructure, and motivation come together.

34 economics

10 lessons from the great 21st century Recession

‘Great Recession’? Of course not greater than the Great War 100 years ago but let us not forget the lessons of this lesser skirmish since it arguably affected so many people.

38

38 Top ten

Technologies to watch out for in 2014

Here are ten emerging technologies which are gaining traction as they move from development prototypes to becoming commercially viable products.

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issue no.55

84

46 mining & Minerals: 46 Aggreko

Power in place

The world leader in temporary power solutions, Aggreko helps governments in meeting the needs of entire populations and keeps industry growing through all contingencies.

56 118

56 Goldcorp – Marlin Mine Guatemala’s gold standard

The first gold mine of significant size in Guatemala, Goldcorp’s Marlin Mine continues to make new discoveries that are increasing its life expectancy.

72 EXSA Peru

Creating exact solutions

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In expanding its value proposition, EXSA is positioning itself to remain as influential to Peru’s mining sector as it has been for the last six decades.

contents

82 Alamos Gold

A track record to be proud of

The secrets behind the company’s success and how its commitment to responsible mining has improved the lives of many.

82

92 Reliable Controls

Better Controls and Plant Commissioning

Reliable Controls Corporation is a dependable partner for plant automation, assessment, auditing and commissioning work, particularly in mining and O&G projects.

energy: 102 PREPA – Puerto Rico Electric Power Authority

Bringing change to the Caribbean

Puerto Rico’s principle electricity provider is moving forward with plans to shift the island’s dependence from petroleum products to natural gas and renewable energies.

102 120

112 Petroleos Mexicanos – PEMEX Moving Mexico forward

Mexico’s largest enterprise and biggest taxpayer intends to invest a record amount in 2014 in order to maintain its position among the world’s elite oil companies.

food & drink: 120 Camanchaca

Feeding the world from the ocean

Camanchaca’s quality fish products have made it a leading player on the international stage

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Strategy

Signs of a Good Solution If a solutions strategy can enable a firm to stand out from its competitors the payoff can be considerable Words by

George F. Brown, Jr.

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e’ve all been in settings over the years, from locker rooms to auto plants in China, in which motivational signs were prominently displayed to ensure that key lessons were not forgotten. Even while watching Pawn Stars on television recently, an episode showed signs featuring the Old Man’s aphorisms like “Do something for God and country and get back to work.” For firms looking to elevate their position with customers through a solutions offer, a useful sign in the conference room might be drawn from an observation once made by Malcolm Forbes: “It’s so much easier to suggest solutions when you don’t know too much about the problem.”

The importance of understanding the problem could not have been more clearly emphasized by customers describing successful – and unsuccessful – attempts on the part of their suppliers to create value through a solutions offer. Comments made during interviews on this topic ranged from the good (“Sometimes I think they understand our company and our problems better than we do ourselves”) to the bad (“Maybe some engineer thought this was a good idea, but they could have saved a lot of money had they asked us first”) to the ugly (“After I listened to that presentation, I decided it was time to look for a new supplier”).

This message is of considerable importance, since in recent years, “solutions” have become a core element of the strategy through which firms create value and differentiate themselves from competitors. Many firms, finding little headroom for growth with their current business model, look to move into a larger available market space by expanding their offering to include more products (typically adjacent ones) and services (typically complementing and/ or connecting those products).

In addition, it is frequently the case that the migration to a solutions offering allows a supplier to escape from the process of commoditization – a situation that many manufacturers have faced as global competitors become increasingly able to deliver similar-quality products at lower and lower prices. Complementary services may be the element of many projects that can’t suffer the same fate, and a solutions strategy that brings higher value to the customer can protect the legacy product base and allow expansion in adjacent service businesses.

The first element of a sound solutions strategy is the need to understand your customer and its business environment, perhaps even better than they understand it themselves, as the first comment above suggested. After all, if the value creation opportunity associated with the solutions

“Many firms, finding little headroom for growth with their current business model, look to move into a larger available market space by expanding their offering to include more products and services” 10 |

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Strategy

“The most significant solutions success stories are ones that involved a supplier seeing a new and different way of doing things” offer was obvious, the customer would have either implemented it themselves or put out an RFP to attract a supplier capable of doing so. The most significant solutions success stories are ones that involved a supplier seeing a new and different way of doing things. But if a solutions concept demonstrates that you don’t understand the problem in the way that it is seen by the customer, it is going to fall flat on its face.

One supplier in the telecommunications industry had a very strong position with its equipment products, and looked to expand into life-cycle services associated with maintenance and repair, an offering that had historically been provided by independent contractors without any real connection to this equipment manufacturer.

This firm recognized that it would take innovative thinking to win in the services business, requiring an approach that in some way was “better and faster” without too much of a compromise in terms of the cost of those services. It revisited its product strategy, and identified ways in which it could incorporate monitoring capabilities into the equipment that would both signal exactly what maintenance was needed and also shift some instances of corrective maintenance to a less-disruptive and less-costly preventive mode. This solutions offer thus integrated product and service elements in a meaningful way, one that yielded value for customers along “better and faster” dimensions that were

important to its customers. And, in the end, this innovative solution allowed this supplier to make a case that their approach was in fact cheaper from an all-in life-cycle cost perspective.

This firm’s familiarity with their customers and their operating environment enabled them to spot the elements of a solutions offer that would resonate.

They understood service challenges, particularly those that existed in remote areas where second visits were very costly, and they understood the enormous cost of downtime caused by product failures or delayed repairs. Their solutions offer enabled them to succeed in the service business because it addressed two real problems faced by their customers.

An executive from a packaging industry firm returned from a customer visit reflecting on the fact that the customer operated two entirely separate packaging processes in the factory that he had visited. One process involved the primary packaging that was associated with the eventual use of the product. The second process involved the packaging associated with merchandising and shelf display. He returned from that visit with the vision of a solution that might yield significant cost savings for this customer if the two processes could be combined into one. His firm’s design team subsequently developed packaging that allowed the merchandising challenges could be met

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by an evolved version of the primary packaging, thereby eliminating the need for secondary packaging entirely. In a subsequent interview with an executive in the customer organization, I heard the following comment: “Sometimes you don’t look at your own operations and see the potential for change. We had always done it the way we were doing it, and it took [the visit from the supplier’s executive] to see that there was an alternative.”

Both of these success stories involved a supplier that brought a solution to a problem (or opportunity) that customers didn’t know that they had – but recognized when it was brought to their attention.

The litmus test of whether a solutions concept will be recognized and accepted is whether it creates previously undetected opportunities for value creation for your customer. If it does, it has the potential for acceptance. And it takes a serious investment in the customer relationship to build the knowledge base from which a supplier can identify unspotted opportunities for value creation.

Such insights don’t just happen. They are typically the product of a carefully planned set of interactions between a supplier and its customers, involving ongoing investments in these relationships.

“We had always done it the way we were doing it, and it took the visit from the supplier’s executive to see that there was an alternative” 12 |

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Efforts are made to ensure that discussions are future-focused, oriented to ensure that the supplier learns what is keeping the customer’s executive awake at night.

Attention is given to changes taking place in the customer’s business environment, along dimensions that range from regulation to technology to competition.

Such interactions aren’t limited to the account team working with the customer.

Rather, they involve functional experts in the many specialties relevant to the relationship. Suppliers that are successful in knowing their customers better than they know themselves are proactive, often reaching out to customers with an idea or an insight gained in another part of their business. Being future-focused, emphasizing what is new, involving numerous people and business functions in the relationship, and being proactive are signs of a firm that has the potential to successfully spot solutions opportunities.

There was a second message about solutions that also deserves a sign in the conference room, perhaps drawn from the observation by Woodrow Wilson that “If you want to make enemies, try to change something.” In reflecting on solutions concepts that their suppliers had brought to them, many executives made remarks such as “It was a good idea, but not a good idea for my company” and “We have too much on our plate to buy into another major change, even if the idea has merit on its own”.

Most businesses in recent years have become acutely aware of the challenges of making changes to their business model or to their operations. Change itself is costly, and demanding upon a firm’s

Strategy

leadership and resources. One executive with whom I’ve worked recently decreed a “one change at a time” philosophy, requiring that other good ideas be put on the shelf if they were going to compete for attention with a change already approved and underway. Whether one change is the right limit probably depends on the organization, but almost everyone would agree that too many changes going on at once is a prescription for failure.

This second message defines another dimension along which understanding customers and their business environment is critical. Some solutions are going to fit in naturally, without disruption. The telecommunications firm that implemented a services solution did not impose much in the way of change on its customers. From the customers’ perspective, it was close to business as usual, with the benefits of streamlined service and fewer disruptions.

On the other hand, the customer of the packaging firm described above viewed the change as a major one, and in fact delayed implementation while it went through a process of validating that the supplier had the right competencies to work with them on merchandising and display.

While the challenge of understanding

“While the challenge of understanding customers better than they understand themselves is a major one, there are very good reasons for considering solutions strategies” customers better than they understand themselves is a major one, there are very good reasons for considering solutions strategies. If a solutions strategy can move a firm from a narrow product or service niche to a position of relevance for much or all of the overall customer spend, that can lead to significant growth in both the size of the available market and margins.

And if a solutions strategy can enable a firm to stand out from its competitors in terms of the value that is delivered, the payoff not only involves current sales and profits, but also long-term relationships.

Remembering the signs that customers use to point the way to a successful solutions strategy can become the route to solutions success stories.

About the author George F. Brown, Jr. consults with industrial firms on growth strategy through his firm B-to-B Advisors, Inc. He is the coauthor of CoDestiny: Overcome Your Growth Challenges by Helping Your Customers Overcome Theirs and the cofounder of and a Senior Advisor to Blue Canyon Partners, Inc., which he served as CEO for fifteen years. George has published frequently on topics relating to strategy in business markets, including articles in Industry Week, Industrial Distribution, Chief Executive, Business Excellence, Employment Relations Today, iP Frontline, Industrial Engineer, Industry Today, and many others. gfb@BtoBAdvisors.com

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Strategy

Right to the top:

Practical Project Management Advice For The C-Suite As technology continues to improve, departmental fragmentation is being reduced: specialism is critical for business success but increased collaboration is driving executives together in ways never witnessed before Words by

Esther McMorris

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Strategy

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hichever side of the C-Suite you look at, senior management is seeing its isolation ebbing away.

This is a positive development. It creates a more agile business that can maintain its competitive advantage in the face of a quickly shifting marketplace.

The CFO can no longer ignore the CIO. They must work together on transformative projects to ensure return on investment and long-term value. COOs and heads of HR need to unite across change projects, otherwise new processes and procedures fall on deaf ears and impact staff morale.

Broadening skillsets and new challenges have placed senior management in a realm crucial for business advancement; Project Management.

Better Understanding Project management knowledge is now vital for everyone, especially as senior executives hold the budgetary and operational keys to success. They are often the main stakeholders or if not, they know who to influence to drive project success.

Lower management usually limits the C-Suite to final approval on projects (often at C-Level request), but the demand for better results, greater corporate accountability and general financial prudence means a greater number of

senior executives are involving themselves in projects from an earlier stage.

To ensure a smooth process, clear planning should occur from the outset.

Put an achievable strategy in place, outline the key objectives and explain what needs to be done by whom.

This applies to every project, whether bringing a new product to market, a fresh marketing strategy, a transformative HR change or improving IT. Two Way Communication If the roadmap seems overly complicated, it probably is. Never block constructive suggestions. It helps highlight areas of concern, especially for individuals suffering from over-exposure/project familiarity.

Project Managers should bear in mind that C-Level stakeholders might have had less exposure to day-today project management and actually need reverse management.

The C-Level should be open to this.

They need to give project leaders space to work and trust their judgment. Too much involvement can cause dissatisfaction to fester, which harms staff relationships and the project’s long-term success.

Put in place regular dialogue sessions so concerns are raised and communicate this progress throughout the organisation.

Having C-Level vocalisation behind a project can actually give it greater internal

“COOs and heads of HR need to unite across change projects, otherwise new processes and procedures fall on deaf ears and impact staff morale�

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strength and relaying advancements will always keep momentum up between staff.

C-Level stakeholder involvement, if handled in the right manner, is very welcome.

The Right Strategies For those unfamiliar with project management strategies, there are five key stages for guaranteeing success: 1. Project Definition 2. Hatching The Plan 3. Maintaining Control 4. Delivery 5. Long-Term Lessons/Results Define The Project Begin by defining the project’s scope, analyse the available resources and

“Benefits have to be realistic, measureable and classifiable otherwise return on investment will appear unachievable� potential costs, identify possible risks and then build a business case that will guarantee commitment from relevant stakeholders.

Benefits have to be realistic, measureable and classifiable otherwise return on investment will appear unachievable. These are classified in four ways; direct monetary benefits; direct non-monetary benefits (improved KPI performance, better customer support); indirect benefits like reputational enhancement or improved staff morale; and dis-benefits i.e. what will happen if the project does not take place.

Hatch The Plan Next carefully balance development time and the available resources against quality constraints and management involvement. Schedule time within the plan for review periods so feedback can be provided and concerns aired.

Consider creating a critical path, a mapping of the longest route through all dependent activities. This prepares staff and the C-Suite for possible complications and establishes realistic timescales to keep to. The same applies to risks. Calculate their probability and what their potential impacts are. Focus on squashing critical time-sensitive

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Strategy

concerns while monitoring those that are less disruptive, but still possible.

Maintaining Control This is a key area for the C-Suite. Project managers should re-communicate the project’s roadmap to everyone involved and then share progress at significant points.

Stagger feedback so individuals never feel overloaded. When communicating progress, ensure people actually take it onboard. Updating stakeholders is not the same as them actually understanding the information. Ensure people know what is being communicated, rather than just speaking at them.

Finally implement a clear change process. This ensures input is actually absorbed and actioned to those in charge.

It also means those giving feedback feel like their advice is having a positive impact on the project.

Delivering The Results There are five different launch options, each with their own benefits and business alignments – standard pilot, phased rollout, parallel running, hot changeover or a ‘big bang’ launch – and outline which is relevant for the business and project during the planning stage.

Never rush it. Finish any pre-launch testing (general testing should occur throughout the project to make sure the majority of issues have been dealt

“Finish any pre-launch testing and conduct business simulation before pressing the green light” with) and conduct business simulation before pressing the green light.

Sustainability If effectively planned and managed, the project will achieve success, but even post-launch there are areas to address to guarantee the success of future projects.

Clearly highlight what went well and what could have been better.

Reflect on failure objectively and without assigning personal blame. This is important for staff morale and for ongoing management relationships.

Conversely, celebrate success but always strive for better performance.

Offer training for problem areas and discuss long-term project objectives to prevent them from being forgotten.

If these steps are followed, a business will experience greater resource and budgetary control during implementation, faster development, higher quality, which means stronger customer relations once delivered, and an overall reduction in costs.

About the author Esther McMorris is founder and director of Nine Feet Tall, experts in business transformation and leaders in delivering positive change. If you need more advice, why not read The Little Book of Project Management from Nine Feet Tall www.ninefeettall.com/insight/little-book-project-management

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LUE A V • LUE

VALUE

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• VA E U L • VA

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Take a proactiv o pricing and turn from a threat to ge Word s by Geor

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Strategy

VALUE • VALUE • VALUE • VALUE • VALUE • VALUE

VALUE • VALUE • VALUE

ing

Experiences VALUE • VALUE • VALUE • VALUE • VALUE • VALUE

• VALUE • VALUE

ve approach to on online competiti y o an opportunit e F. Brown, Jr.

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I

n a recent discussion about customer experience that had been lively and provocative, the room went silent when the topic of pricing surfaced. That was not surprising, as it’s easy to anticipate that a low point in most customer experiences involves the discussion of prices. Even ads for car dealers have focused on the ways in which they’ve taken trauma and tension out of the purchasing experience, alluding to the industry’s tradition of unpleasantness during price negotiations. And the competitive environment of recent years has probably added to the difficulty that exists in coming to agreement on price. We have all heard quotes like the following. “The only way we got people into our store over the holidays was with massive discounts.” “My customers had to go down market during the recession, and they aren’t moving back up.” “We keep losing share to private labels in the Big Boxes, all due to price.”

While the above challenges are solidly based on reality, making pricing a

got “The only way we ore over people into our st with the holidays was ” massive discounts

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daunting topic, firms that proactively manage pricing strategy with the right tools in place can produce significant top- and bottom-line results. A point gain in realized prices can yield a much larger proportional improvement in profits. And the evidence is strong that there is a strong correlation between margins and negative customer experiences – and that correlation goes the wrong way. Firms pay a price when the customer experience turns negative when the topic of price arises.

In my work with clients on pricing, two themes have emerged that can help to translate pricing into a positive element of the overall customer experience. The first lesson is well-reflected in a quote from Warren Buffet: “Price is what you pay. Value is what you get.” Over and over, observing the flow of the sales process, the focus on value disappears when the discussion turns to price. It is almost as if a gate has slammed shut, closing off all the valid reasons that had previously been communicated to the customer when the discussion shifts to price.

One of my clients has used a tactic of responding to customer requests for lower prices with an almost immediate offer to move down the Good-Better-Best spectrum to the product that matches the price request made by the customer, carefully pointing out the tradeoffs that are implied by that choice. This tactic, in his opinion, allows him to show respect for the customer’s price request, but at the same time allows him to focus

Strategy

on the value contributions associated with the highpriced product first and “One firm success fully introduced foremost. He believes a premium price pro that by doing this, he duct into an is able to link value in credibly challengin and price in the mind g market of his customer. And, by implementing a strategy that as one additional ‘g ave customers an benefit, he believes option that that this approach they could refuse’” allows the focus of the customer experience to return to the positive themes associated with the value being delivered.

Another client emphasizes in its sales training programs that not every it. Their marketing program emphasized price challenge is a real threat. There the value associated with the high-priced are segments and customers in just option, and implicitly told customers that about every market that are willing to the decision on price was theirs, that pay for product and service superiority. they could go either way, and that they This firm emphasizes that remembering would get what they paid for.

– and, more importantly, reinforcing – Several years ago, Charlie Peters, the non-price advantages that they offer Senior Executive Vice President and can enable their sales team to avoid a member of the Board of Directors of unnecessary participation in the vicious Emerson, gave the keynote address at cycle of price-based competition. One of a meeting of the Professional Pricing their slides reads “Don’t discuss price.

Society. His presentation offered many Discuss value.” It is a good message. insights and actionable suggestions, Still another firm successfully gained from his experiences as the pricing introduced a premium price product czar at Emerson. But the cornerstone of into an incredibly challenging market his advice, which he returned to time by implementing a strategy that “gave after time, was that the key to success in customers an option that they could realizing attractive prices was delivering refuse.” That strategy offered the best value to customers. It is a message that of both worlds – the firm didn’t take a should always be at center stage. major risk because it continued to offer In industry after industry, I have seen a low-priced option, but it gained upside examples of firms that were able to realize potential from customer segments that premium prices by learning of the unmet wanted more and were willing to pay for and poorly met needs of their customers,

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and responding to them. One client with whom I worked several years ago started off a discussion by lamenting that the product line is question involved a stable and well-understood technology, some of the best companies from three continents, and little opportunity for innovation. I asked him if that view was shared by the customers who bought that product, and his response emphasized the high levels of satisfaction that were reported in survey after survey. My follow-up question was whether those surveys had ever asked for a “wish list” not presently offered by those in the market, and the response was that had never been asked. When we subsequently did ask that question, the results were surprising. While about 60% of those that answered did not suggest items on their wish list, the remaining 40% had wish list requests. Two of the wish list items most frequently mentioned were not only feasible additions to the product line, but were relatively easily implemented.

“Create value to capture value” is an enduring lesson, one that if remembered

omers that “I heard from cust process, not g n ci ri p e th s a w it had triggered t a th , se r e p s ce ri p negative reactions”

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can help to ensure that the discussion about pricing becomes a positive element of the customer experience. If your firm is delivering value to your customers, you can be rewarded for it, through a price premium or otherwise, and customers can be comfortable with that fact as long as they see the linkage between value and price. The examples and suggestions above have returned to this theme over and over, deliberately. Creating value is the route to making pricing a positive experience.

The second theme that emerged in research on how pricing fits into the overall customer experience addressed a different dimension of the overall customer experience. And it is, once again, something that can be managed so as to avoid problems. In many interviews, what I heard from customers was that it was the pricing process, not prices per se, that had triggered negative reactions. Such comments weren’t reflecting more instances of the old-time car sales environment.

Rather, they reflected frustration over delays, approval processes, duplicative paperwork, information gaps, and other ways in which the customer is “run through the gauntlet” in order to make a purchase. In one interview, a customer of one of my clients gave the following advice: “If there was one thing I’d tell [your client], they should try to buy one of their own products. It’s a nightmare if there is any complexity whatsoever to the transaction. We love their products, but hate to do business with them. I don’t know how to fix this, but I will

Strategy

tell you that it’s costing them sales.”

Pricing processes are an “Pricing processes important part of the customer that are experience, and if the customer customer-friendly is put through the wringer, and that v that can be the element alue the customer ’s time are ones that is most remembered. th at will increasing In one recent project, I had ly become ‘table the opportunity to interview stakes’ for many su ppliers” purchasing executives that had shifted a meaningful portion of their buys to Internet-based suppliers, including some of the new providers like Amazon Supply.

What I heard, over and over, can be summarized in a single phrase: “easy Pricing will always be part of the to do business with”. I certainly heard customer experience, and ensuring comments about the breadth of the that it is a positive part will become product lines that were available, strong more and more critical. Firms that take logistics, and low prices, but the “easy a proactive approach to pricing and to do business with” theme was the one find a way to explicitly link price to that was communicated with feeling the value delivered to their customers and was typically the first dimension are going to be rewarded. And pricing of the experience that these purchasing processes that are customer-friendly executives mentioned. Pricing processes and that value the customer’s time that are a positive part of the customer are ones that will increasingly become experience will become a more and more “table stakes” for many suppliers. The important differentiator in the future, as rewards from making pricing a positive such Internet-based competitors grow part of the overall customer experience and enter into new markets. can be enormous.

About the author George F. Brown, Jr. consults with industrial firms on growth strategy through his firm B-to-B Advisors, Inc. He is the coauthor of CoDestiny: Overcome Your Growth Challenges by Helping Your Customers Overcome Theirs and the cofounder of and a Senior Advisor to Blue Canyon Partners, Inc., which he served as CEO for fifteen years. George has published frequently on topics relating to strategy in business markets, including articles in Industry Week, Industrial Distribution, Chief Executive, Business Excellence, Employment Relations Today, iP Frontline, Industrial Engineer, Industry Today, and many others. gfb@BtoBAdvisors.com

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Innovation

Managing sustained

innovation for a smarter planet Extraordinary outcomes can be achieved when the right people, infrastructure and motivation come together Words by

Dr. Bernard S. Meyerson

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I

nnovation has always been essential for any organisation wanting to grow. The importance of sustained innovation however, has been less widely recognised up until recently, but is taking on more significance as a result of two key factors.

Firstly, many companies that failed to sustain innovation during the downturn have subsequently struggled or not survived. This trend is evident when comparing the findings of McKinsey’s annual Global Survey of CIOs, CEOs and executives. In 2007 (the year before the financial crash), the ability to innovate was valued highly by 54 per cent of respondents. In 2010, this figure was 84 per cent. The bottom line is that after every major economic downturn, it is the companies that have continued to innovate that have survived.

Secondly, we must prepare for a postsilicon era. After decades of consistent improvement in the cost, capability and ubiquity of computing, equally steady progress in silicon technology (often referred to as Moore’s Law) means we have reached the point where ever more material constituents in transistors have shrunk such that quantum phenomena render them useless. The notion of everlasting generations of smaller, faster and less costly technology has run

squarely into immutable laws of physics.

Put succinctly, atoms don’t scale.

These factors have ensured the rebirth of innovation, with future progress in IT performance being realised through new system architectures and materials, and emerging fields such as cognitive computing and its application to Big Data. But before going any further, some words of caution: It is essential to approach innovation as an engine that can take 30 years to start and three minutes to kill. Companies should acknowledge this before turning the key either way in the ignition.

Essential elements There are some key ingredients required to enable sustained innovation within an organisation. The most important element of course is people. The main challenge however, is that a very different type of individual is required to manage innovation than would have been sought in the past – the days of relying on someone with four PHDs and three Masters, but who is unable to communicate their ideas to a wider audience, are gone.

Indeed, the type of innovator IBM looks for shares two basic properties: tremendous depth, in that they are exceptionally bright; and the ability

“The type of innovator IBM looks for shares two basic properties: tremendous depth, in that they are exceptionally bright; and the ability to communicate their ideas broadly and operate as part of a team” 28 |

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Innovation

“If sustained innovation had not taken place once the disk drive was invented, the average laptop today with an internal spinning hard disk would weigh about 250,000 tons” to c om mu n ic ate their ideas broadly a nd operate as part of a team. In today’s commercial environment, innovators that are infinitely deep but have no breadth are limited in value, as they are unable to share their ideas or learn from their peers.

There are also two types of innovator required for sustained innovation. There are the ‘discontinuous innovators’ that have the ‘big ideas and “ah-ha!” moments, who every now and again invent something groundbreaking. At IBM for example, we have Robert Dennard, who invented the one device memory cell, more commonly known as Dynamic Random Access Memory (DRAM). Dennard also solved one of the conundrums about Moore’s Law by coming up with the right recipe for placing twice the number of transistors on each subsequent generation of chips of the same size, while keeping the power requirements constant from generation to generation.

Then there are the ‘continuous innovators’, these are the people who

drive small and steady improvements that are nonetheless vital to sustained innovation. A good example is the team at IBM who drove decades of improvements in disk drive technology. If this type of sustained innovation had not taken place once the disk drive was invented, the average laptop today with an internal spinning hard disk would weigh about 250,000 tons.

In addition to a combination of types of innovator, you also need an infrastructure that enables these people to collaborate effectively on a global basis. Such collaboration is necessary across disciplines, organisations, markets, and cultures. Put simply, you don’t get your best result when you have a single, homogenous effort.

Scaling versus Moore’s Law Innovation is a matter of increasing importance because information technology is reaching an impasse. One of the core issues is that Moore’s Law has a logical end. If the industry continued to produce a silicon chip that is half the size every 18 months, then eventually

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it would be splitting atoms (and we all know what happens if you do that!).

Already, the industry is fast approaching the physical limits of silicon technology.

We are also reaching the limits of being able to scale technology out to ever larger systems and data centres.

Indeed, what is remarkable with innovation is that you have to revisit every assumption you have ever made about technology. Everyone thinks you don’t have to worry about light being too slow for a given operation but in actual fact it is. Technology today is so fast that one of IBM’s chips performs a complete work cycle in the time it would take a beam of light to travel about 2cm. In the context of a data centre, where many machines can be working together on the same problem but are located hundreds of metres apart, there can be vast delays because the optics employed to transmit signals between them isn’t fast enough.

This is why we need to find new ways of making com municat ions faster. Ironically, the

trick is to start innovating by inverting everything that’s been done before in order to improve things. This is where it gets really interesting. With ‘chip stack’ technology for example, it is possible to create an entire system by thinning individual chips to 50 microns, then stacking some 30-50 thinned chips to form a single chip that is just a couple of millimetres high, reducing communications distances within an individual system from metres to millionths of a metre. Light isn’t getting any faster, so you “simply” make communication distances shorter.

Data, the new oil Despite nearing its limits, silicon technology will still be employed for many decades yet. The difference is that the innovation will come from the integration of hardware, software, systems, and network functionality, compressing communication distances, as light is way too “slow”. Fundamentally, after years of scaling out systems, the focus has come full circle and the architecture is

“With ‘chip stack’ technology, it is possible to create an entire system by thinning individual chips then stacking them to form a single chip that is just a couple of millimetres high, reducing communications distances within an individual system from metres to millionths of a metre” 30 |

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Innovation

“Data itself has become an issue, because information technology is generating ever-greater volumes of data that needs to be stored” now “scale in” since you get huge benefits from proximity in both reduced communication delays and decreased power requirements to send signals given the much short distances involved.

At the same time, chip stacking presents huge technological and material challenges, not least in terms of powering and cooling chips buried mid-stack.

You now have 30-50 times the number of chips, and thus transistors, in an area and volume where there had once been only one chip, so this system in a single chipstack presents many issues yet to be fully resolved. Nevertheless, progress is being made with this technology, and since the distance between memory and logic shrinks to microns as opposed to metres or more, the power required for signalling is reduced substantially. There is also some elegant work being done in with optics being integrated onto the chip stack, because conventional electrical signals would not be able to transfer data at the speeds or over the interchip distances as required.

Even data itself has become an issue, because information technology is generating evergreater volumes of data that needs to be stored.

More importantly, it must be used effectively. In the words of respected sof t ware i n du s t r y ent repreneur and technology leader Ann Winblad: “Data is the new oil. In its raw form, oil has little value. Once processed and refined, it helps power the world.”

Data is now an asset, but it will call for a petabyte of storage class memory, or some vast new high-speed storage device to manage it, as well as a new suite of software tools – or ‘analytics’ – to understand it. Again, how we approach data requires an inversion of the conventional model of data management – i.e. quantities of data are now so vast you cannot move it to a central compute engine, you must invert that process and have many compute engines operating on a vast central yet constantly evolving data store. Even more critical, over time one must innovate so as to analyse incoming data “on the fly”, and store only ones

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The IET Prestige Lecture Series Bernard Meyerson presented t he IET/BCS Turing Lecture at the Royal Institution, London on Monday 24 Febr ua r y, Cardiff University on Tuesday 25 February, The University of Manchester Wednesday 26 February, The University of Edinburgh, Thursday 27 February, a webcast of the lecture can be viewed here. The free to attend lecture was part of the IET’s Prestige Lecture Series, many of the lectures were established in memory of engineers who achieved exemplary and ground breaking work in their day. The speakers invited to give IET Lectures are of that calibre – innovative, forward-thinking and at the top of their game.

The IET is one of the world’s largest organisations for engineers and technicians.

It has 153,000 members in 127 countries and is leading the development of a global engineering and technology community to share and advance knowledge to enhance people’s lives. Showcasing the latest ideas and technologies, the nine lectures cover a variety of engineering disciplines, ranging from general interest to the more technical. www.conferences.theiet.org/lectures

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learnings, disposing of the vast raw data flow that might drown one over time.

Shooting for the moon Integrating analytics tools with realworld data opens up great possibilities for improving lives, enabling problemsolvers to be proactive instead of reactive. For example, advances in data analytics makes it possible to predict the flow of traffic, and combat congestion and traffic jams. In Singapore, models can now predict future traffic jams from current road conditions, and electronic road pricing is implemented to manage traffic patterns through toll prices and other measures that steer traffic into new flows to eliminate a jam that would have otherwise developed. One literally alters the future.

The uses for Big Data are literally boundless, but the IT industry and its partners must use these analytical tools to enable solutions for a smarter planet.

Probably one of the biggest societal changes passed by virtually unnoticed in 2010: It was the first time in the history of mankind that more people lived in a city than in a rural area. Move forward 20 years and there will be almost 2 billion people migrating to major urban

“The uses for Big Data are literally boundless, but the IT industry and its partners must use these analytical tools to enable solutions for a smarter planet”

Innovation

“The Apollo space programme cost is estimated at $25.4 billion, about $150 billion in today’s money, but it ushered in an exciting new era of technological development and has delivered countless innovations”

centres. This is a sobering thought, and why it is so important we get cities right.

Back in 2008, IBM’s chairmen Sam Palmisano said that the company would fund great ideas for a Smarter Planet to the tune of up to $100 million, challenging all employees to propose sustainable businesses serving the public good in key areas of challenge. Sustainability was key, as then society benefits on an ongoing basis. Setting such a grand challenge is the best way to drive a team to innovate, and possibly the greatest example in modern history is the US space programme.

In 1961, President Kennedy challenged NASA to land a man on the moon and return him safely to earth before the end of the decade. NASA’s space programme

saw the Apollo 11 astronauts realise President Kennedy’s dream on July 20, 1969. The Apollo space programme cost is estimated at $25.4 billion, about $150 billion in today’s money, but it ushered in an exciting new era of technological development and has delivered countless innovations of huge benefit to society – from freeze drying technology to the materials used in frying pans.

We’ve certainly come a long way since man first landed on the moon.

The Apollo Guidance Computer had just 4K RAM and a 2MHz CPU; the average smart phone today has 256 MB of RAM and a dual core 1.2 GHz CPU. The rub is that the technology shrink that achieved these gains has almost run its course, so we need to find other ways to push things forward.

About the author Dr. Bernard Meyerson serves as Vice President of Innovation at International Business Machines Corporation. Dr. Meyerson served as the Chief Technical Officer and Vice President at IBM Technology Group. He has held this position since October 2005. Dr. Meyerson joined IBM as a Research Staff Member in 1980 and was later promoted to the Vice President of the Communications Research and Development Center.

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Economics

10 lessons from the great 21st century Recession ‘Great Recession’? Of course not greater than the Great War 100 years ago but let us not forget the lessons of this lesser skirmish since it arguably affected so many people. It was (and still is) the greatest economic crisis since 1929 – the so-called Great Depression. So what are the lessons for businesses?

Words by

Stephen Archer

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The seven year economic

1 cycle is a dead concept

It used to be the case and is supported by much evidence that economics tended to go in seven-year cycles: seven years climbing and seven years declining. We are now nearly six years on from Lehman’s collapse though the current recession dates back to a year before that when LIBOR rates spiked suggesting a collapse in confidence in bank debt amongst banks themselves. The interconnectivity of global markets and economies means that each economy is more likely to be affected by a global than domestic issue today. Warning signs may be around the globe, not around London, New York or Tokyo. We disregard warning signs at our peril, but warning signs are now far harder to discern.

The bankers and even the governors of our economies were once seen as heroes.

Years of growth seemed unstoppable; a new paradigm of continuous growth became accepted wisdom. More scepticism would have been wise but the words of caution that did exist were shouted down and suppressed. Looking back now at the unfettered free market dogma of Greenspan and even Adair Turner now looks like terrifying folly – because it was. Those that created huge wealth and helped economies grow did so with insufficient rigor and doubt.

Yes, doubt, it’s a good thing; the check on hubris.

We should embrace and

Though I may suggest naming recessions they will still be unreliably forecast just as weather forecasters so often fail.

Economists of all hues lost huge credibility in the Great Recession. Few saw it coming and few predicted its course even after it started. This is a problem but for businesses the best hope is to focus on the economics and influences for the markets in which their industry operates. Each industry has own response to recessions.

However, the global and macro economic factors cannot be forgotten.

2 even name recessions

Like the hurricanes that hit America we should name the recessions and connect better with them. This is not to say that we should wallow in them but this could I think help us avoid denial, increase understanding and reduce ignorance. We all suffer the consequences and can contribute to the recovery so let’s keep recessions top of mind and not allow politicians to exploit them for their own ends.

“We disregard warning signs at our peril, but warning signs are now far harder to discern” 36 |

Beware the heroes – they

3 too often fall like Icarus

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Beware the forecasters –

4 complexity is defeating them

We need to understand

5 the new global order

‘When China sneezes the US catches a cold and the rest of the world feels sniffly’. The global nature of capital flows and political impact is something to be concerned

Economics

about. We are not able to vote for people who may determine our economic destiny. Those in business, especially big business need to take greater political and economic responsibility and do so responsibly.

“In the Great Recession we saw debt ruin entire countries and severely damage their social fabric”

When it’s in the news

6 the horse has bolted

The signs of the last recession were clear for many months, even years before it hit home. The speed of such events may be alarming but the lag from cause to effect needs to be better understood and managed. This recession started not with the consumer but with banks. More could have been done to insulate the consumer and business in future.

Understand why we

7 are doing well

When it all goes wrong in the economy or business there is always an inquest. Such rigorous examination is rarely to be seen when things are going well. Such are the seeds of complacency and ignorance and yet when things are going well we have the time and funds to really understand why and in so doing understand the risks to sustaining success.

Look after the next

8 generation

Humans have the selfish (survival gene) but survival and decadence with decay are not behaviours separated by much.

We tend to think of our children, as having to look to for themselves and to some extent this is correct and healthy.

But we do not have to make it hard for them by ruining the resources that could

be available to them if we took more care.

This applies to business too.

Debt can be a bad

9 thing, VERY bad.

Debt for consumers and businesses can lead to ruin. In the Great Recession we saw debt ruin entire countries and severely damage their social fabric. (Iceland, Spain etc.) That debt in sovereign states is now even larger than it was in 2008 with little sign of reducing. Businesses depend on debt finance but have in recent years found it hard to get or undesirable to attain.

The reality is that our thinking about debt wisdom needs careful clarification.

The global debt model is broken but for businesses it’s repairable.

Learn

10 There are some good books on the recession (e.g. Kenneth Rogoff) Read one or two of them. If nothing else you may come away trusting fewer people. That may not be such a bad thing.

About the author Stephen Archer, Business Analyst and director of UK business consultancy, Spring Partnerships www.springpartnerships.com

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top ten technologies to watch out for in 2014 Here are ten emerging technologies which are gaining traction as they move from development prototypes to becoming commercially viable products Written by: Will Daynes

Top Ten

Stefano Tinti / Shutterstock.com

1 Graphene Thinner than a sheet of paper, yet 200 times stronger than steel and more conductive than copper, in the eyes of many Graphene is the future.

Branded as a “supply critical mineral” and a “strategic mineral” by the US and the EU, Graphene is today being used throughout the world in order to achieve critical advances in various industries and technologies, from more efficient solar panels to building lighter aircraft.

Everyday items are also starting to benefit from the minerals unique properties, from batteries that last up to ten time faster to phones and computer displays that bend and fold.

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2 Virtual Reality (VR) Once the stuff of science fiction, Virtual Reality (VR) is set to take a major step into the everyday lives of people this year.

Following the crowd-sourcing success of Oculus Rift, which this year revealed its Crystal Cove prototype headset, gaming giant Sony has unveiled its own device, which it has dubbed Project Morpheus. “We believe VR will shape the future of games,” where the words of Shuhei Yoshida, president of Sony’s Worldwide Studios. Applications will however extend beyond gaming, with aspects of VR technology being incorporated into many of the most exciting new innovations, for example Google Glass.

technologies 3 3D Printing While the technology has existed since the 1980s, it has only been in the last few years that 3D printers have become more widely available on a commercial level. Today 3D printing technology, the market for which was valued at around $2.2 billion worldwide in 2012, is being utilised for prototyping and distributed manufacturing across a plethora of industries such as architecture, construction, industrial design, automotive, aerospace, military, engineering, dental and medical care, biotech and even the food sector.

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Top Ten

5 Advanced Robotics

4 Unmanned Aerial Vehicles (UAV) Until now the term Unmanned Aerial Vehicle (UAV) or Drones have had an almost purely military connotation, what with their use being embraced by the US and other armed forces in recent combat operations. While their military applications will undoubtedly grow in the years to come, attention is now turning to what some are calling the untapped commercial use of these pilotless aircraft. Potential future uses of UAV’s includes the monitoring of crops, fighting forest fires, inspecting power lines and pipelines, and delivering vaccines to remote parts of the world.

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The idea of creating machines that can operate autonomously dates back many a decade, however it was until the second half of the 20th Century that fully autonomous robots became a reality. In 2014, robotics is an ever-growing field with commercial and industrial robots more widespread than ever before. Often used to perform jobs more cheaply, and more accurately and reliably than humans, robots can today be found being used in manufacturing, assembly, transport, earth and space exploration, surgery and laboratory research. With innovations in sensors and processing, modern robots are able to tackle more complex tasks with greater ability to adapt and more dexterity than ever before.

www.flickr.com/photos/jurvetson/

technologies

7 Driverless vehicles

6 Space Tourism In 2001, American Dennis Tito became the first space tourist, travelling into the atmosphere on an eight day trip that included a stopover at the International Space Station. Since then only six other people have shared such an experience. Nevertheless, predictions remain that the Space Tourism industry is set to become a billion-dollar market in the coming years, claims backed up by the fact that Virgin Galactic, one of a number of private space agencies, had sold around 500 tickets worth $200,000 each by the end of 2012 alone.

2013 was a landmark year for driverless, or autonomous, vehicles, with the US states of Nevada, Florida, California and Michigan becoming the first to pass laws permitting such vehicles on their roads.

In the wake of this several European cities in Belgium, France and Italy now intend to develop transport systems for driverless cars. It marked the latest step in the development of the automotive sector, one which numerous experts predict will see 75 percent of all vehicles being autonomous by as early as 2035.

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Top Ten

8 Wearable Tech The world has come a long way since the introduction of the calculator watch during the 1980s, a device which at the time was among the very first pieces of widespread worn electronics.

Today the development of wearable technology that will be adopted on a global scale is a crucial aim of the world’s leading tech firms, from Samsung’s new range of Galaxy Gear to Google Glass, the search company’s wearable glasses that it hopes will take the planet by storm. The application of wearable tech also extends far beyond commercial means, with the medical and military industries continuing to prototype and roll out new devices and solutions at a rapid rate.

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technologies

10 Digital Currencies

9 Big Data Never before has so much data been readily available. But how do you get any useful information out of such large data sets?

Data collection is becoming so large and complex that it is virtually impossible to process using traditional database management tools or processing applications. With advances in technology such as semantic language processing, and without the financial constraint to cost effectively store and process huge collections of data, more and more businesses are looking to more unstructured data as a source of customer and business intelligence. Big data is also big business with an influx of new dedicated information management specialists, software firms and businesses that excel in big data management and analytics. In 2010 it was calculated that the Big Data market on its own was already worth more than $100 billion, a figure that has continued to grow by ten percent annually since, twice as fast as the software business as a whole.

Introduced in 2009, Bitcoin was the first cryptocurrency, a digital medium of exchange that is electronically created and stored, to begin trading and remains today the best known and most abundant digital currency, with roughly twelve million bitcoins in existence as of November 2013. Since Bitcoin first appeared numerous other cryptocurrencies have been created, many of which share the characteristic of slowly introducing new units in order to mimic the scarcity and value of precious metals and avoid hyperinflation. What they all share however is a design to replicate Bitcoin’s successes in 2013 when its value at one point topped the $1,000 mark.

Will 2014 be the year that a new contender steps up to challenge Bitcoin’s dominance?

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Po

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Aggreko

ower in place The world leader in temporary power solutions, Aggreko helps governments in meeting the needs of entire populations and keeps industries growing through all contingencies

written by: John O’Hanlon research by: Gareth Hardy

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Banro Resources, DRC 8 MW power project

Aggreko

A

ggreko was founded in the Netherlands in the early 1960s to provide temporary power generation to local companies. In 1973 it moved to the UK, establishing its headquarters at Dumbarton in Scotland, the first step in an expansion programme that has brought it to where it is today, present in 47 countries and employing around 6,000 people. The London Stock Exchange-listed company, a member of the FTSE-100 index, provides power and temperature control solutions to customers who need them either very quickly, or for a short or indeterminate length of time.

Examples would be the supply of power to a mining or industrial site which needs to service its permanent power supply, supplying a whole city in times of power shortage, or providing a major sporting event with power and cooling systems. The key being that power can be delivered anywhere, anytime.

Now we should make it clear from the outset that we are not just talking about providing gensets for pumps, traffic management, individual manufacturing units or the many other uses in general construction. That is an important business, and is comprehensively covered by local service centres around the globe. Larger projects calling for much more complex solutions, are also delivered globally through Aggreko’s Power Projects business.

When it comes to large scale power needed in remote parts of the world, whether the need is short or long term, Aggreko is the company to go to. It supplies multi-megawatt temporary power solutions to companies in the electric utilities sectors, oil & gas (O&G) and mining

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amongst other key sectors. With more than 117 locations across North, Central, South America and The Caribbean, and 194 globally, it boasts the world’s largest generator rental fleet. “Aggreko’s power solutions are rapid, flexible, and highly reliable,” asserts Asterios Satrazemis, President of the Americas Region, where Aggreko lists among its customers every major mining and exploration company as well as most governments and national power grids.

In this region the Power Projects division handles large scale projects, defined as anything from 10 MW to over 200 MW. Its client base is primarily utilities, mining and O&G companies. In many South American countries, he explains, hydro power accounts for up to 60 percent of the matrix. “During periods of drought or an El Niño event these sources drop off and we often get asked to provide an interim power solution for anywhere from a few months to several years on a large scale basis to meet the shortfall.”

Until hydro-generated levels recover, the national power company needs to put in an interim solution to keep the lights on, and the only way to do that is to call in a specialist who can deploy equipment quickly.

“We can effectively deliver a complete power solution within weeks,” says

Satrazemis. “The Power Projects business is conceived around a modular design, where all the equipment is packed in 20-foot ISO containers. It is a plug and play approach so we can deliver assets very quickly with minimal civil works required. We can connect into virtually any voltage they need on the grid, and supplement power to major cities as well as in hard to reach remote areas.”

Aggreko has implemented single projects in

“The Power Projects business is conceived around a modular design ... a plug and play approach so we can deliver assets very quickly” 50 | be americas

Aggreko

Aggreko power plant, Ressano Garcia, Mozambique

Asterios Satrazemis

Latin America in excess of works, installation of the fuel 100 MW, he adds. system including the storage These are not always in tanks, and maintenance the easiest locations. In Peru and operation of the power Aggreko was recently able to plant. In this industry, for The number of locations supply a total of 30 MW of every thousand metres of Aggreko operates from power 3,423 metres above sea altitude, a generator loses in the Americas level to two separate electricity on average ten percent of its generating companies. This power. However thanks to equipment, comprising both the advanced technology of generator units and transformers, provides Aggreko’s generators the total loss above sea partial cover for the power which the level will not be 35 percent, but just ten percent Machupicchu Hydroelectric Power Station over the entire 3,423 metres. will be unable to supply during construction As we frequently note in this magazine, of the Santa Teresa Hydroelectric Power many large scale mining projects are in the Station. This is a turnkey solution for these high Andes. Others are in remote parts of the clients, adding to the supply of equipment the Amazon Basin where the grid will perhaps preparation of ground and civil engineering never reach. In these places localised power

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generation is the only solution either for power until that line arrives and not affect communities or for mines, where reliable, the schedule of production at a multi-billion cost-effective power has to be secured to dollar mining complex. It is an excellent make them viable. “We do a lot of work in long or short term solution to maintaining Colombia, for their onshore O&G projects. schedules. Our modular system allows us to Aggreko can come in and provide turnkey increase or decrease capacity very quickly.” power, including all the manpower they need If any single factor has played into Aggreko’s as well as the equipment and its maintenance. success it is the ease with which its equipment Many mining projects in can be moved to the site. A more accessible regions, 20-foot container can be where power lines can be shifted by train, truck, boat built, get delayed through or aeroplane. Each unit can civil unrest or simply because be kept below 40 tons, which the local power utility does means it is unlikely to be not have the funds,” says affected by weight restrictions People employed Asterios Satrazemis. “We can or snaking roads. However,

by Aggreko go ahead and provide interim as some of the examples

6,000

CP Mining, Australia

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Aggreko

“We can effectively deliver a complete power solution within weeks” given above show, a site does not have to be inaccessible to benefit from the flexible power generation available from Aggreko. “We are working on heavy fuel oil (HFO) solutions as well to get lower fuel cost for our clients.” HFO is the fuel of choice in many island countries says Asterios Satrazemis, and Aggreko’s modular HFO packages are making a big impact on the market.

In other situations liquefied or compressed natural gas (LNG or CNG) stand out as

solutions that allow companies in the hydrocarbons industry to reduce their power generating costs and guarantee seamless operations. In Colombia Aggreko’s economical CNG-based solutions don’t demand high investment in energy supply services like equipment purchase. Aggreko’s affordable rental services include the installation, operation and maintenance so helping push forward production and boost the oil industry with less capital expenditure. For example a Colombian oil company turned to Aggreko to generate power in three of its exploration blocks in the country and improve its production and operating costs. The most widespread fuel source there is diesel, but Aggreko was able to provide this client with a gas solution resulting in considerable savings and an improved carbon footprint.

In March of last year the company announced an ultra-efficient 1 MW engine that will provide its customers with 14 per cent more power at 12 per cent lower cost.

The G3+ is the product of a three–year, £6 million development programme and it is the first time Aggreko has moved into developing its own engine technology. The G3+HFO variant of the new engine is also the first of its kind that can run on HFO, producing power at around half the cost of traditional diesel alternatives.

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Aggreko Unlike many businesses, the recession has not been hard on Aggreko which recorded revenues of approximately $2.5 billion in 2012 and an operating profit of $612 million.

Delays have dogged power schemes and projects that depend on them have depended increasingly on temporary power. “In those cases, where power has to be delivered reliably we are often the first to meet that gap.” It’s a trend seen all over the world, he observes, and a strong driver for the Power Projects business which is growing rapidly in every part of the world, from Africa to the Americas region that he leads. The company has offices serving all of Latin America, the United States and Canada: from these any and every problem relating to temporary power can be solved quickly and reliably.

Satrazemis, who has been in his present post since 1 January 2013 was formerly Aggreko’s Managing Director responsible for the Australia-Pacific Region. In his current role as President of The Americas he is enthusiastic about the flexibility of the service available across the region. “On any given day we will be running base load power for a number of mines, large or small, around the country, where if the power goes down they could potentially start losing millions of dollars in revenue. While the emergency and high profile projects get the headlines, providing businesses with power security on a day to day basis is just as important.”

Ressano Garcia, Mozambique

For more information about Aggreko visit: www.aggreko.com

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Guatemala’s gold standard The first gold mine of significant size in Guatemala, Goldcorp’s Marlin Mine continues to make new discoveries that are increasing its life expectancy

written by: will daynes research by: candice nice

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Goldcorp - Marlin mine

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Panoramic view of the processing plant

Goldcorp - Marlin mine

H

aving been in production since late 2005, it took less than five years for Goldcorp’s Marlin Mine to produce its onemillionth ounce of gold. Located in the western highlands of Guatemala, 300 kilometres northwest of Guatemala City in the municipality of San Miguel Ixtahuacan, in an area boasting elevations ranging from 1,800 to 2,300 metres above sea level, Marlin has operated as both an open pit and underground mine, and continues to generate significant cash flow.

Marlin Mine was originally discovered in 1998 by two Guatemalan geologists. Acquired in July 2002 by Canadian Company Glamis Gold, it was they who, in conducting an exploration study, determined that the mine held a projected 1.4 million ounces of gold.

On 27 November 2003, the Ministry of Energy and Mines of Guatemala issued a licence for the development and operation of the Marlin project and following the successful completion of the construction phase in the third quarter of 2005, the mine began producing gold and silver before the turn of the year.

In the time between 2003 and 2006 approximately $300 million was invested into the operator’s exploration activities and overall preparations for exploitation. It was then in 2009 that Goldcorp invested an additional $69 million into the operation, with a similar figure being ploughed into the business in 2010. Such was Goldcorp’s commitment to the long-term success of the project that it remains on course to have invested a further $150 million into Marlin Mine by the end of 2014.

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Grupo EMO’s leadership rests on the application of specialized, trendsetting techniques in technology, planning and developing in each and every one of our underground constructions, tunnels, open space operations and civil work for hydroelectric. The application of these techniques is performed by highly qualified local and international professionals, using the best human and technical equipment as an operations platform with specialized teams and heavy machinery.

Contact: 00502 + 2361-9444 00502 + 2498-4888 info@grupoemo.com www.grupoemo.com

Conquering Limits • Tunnel construction • Civil Work • Hydropower • Mining • Geotechnical • Soil Nailing • Grout Injections • Explosive Management

Key Work Points: • Profitability • Reliability • Industrial Security • Machinery

Goldcorp - Marlin mine

Local workers

Lying within a highly prospective land package of approximately 100,000 hectares that encompass the main deposit and various important vein structures and mineralised zones, the Marlin site hosts four major lithologic units, those being pyroclastic deposits, marlin andesites, tertiary volcaniclastic sequence and porphyric dykes.

Marlin was the first gold mine of significant size in Guatemala and because of this Goldcorp made it a matter of great important to build lasting partnerships with communities surrounding the mine site. To

GRUPO EMO Since 2004 GRUPO EMO, S.A. has been an strategic supplier for underground mining operations to GoldCorp. Recognized in the Marlin Mine site as prime contractor for underground projects and forming part of the mine development and ore recovering team, GRUPO EMO has offered a wide range of activities for underground applications including mine development, service installation, bolting and ventilation, also different type of underground support systems including cement and chemical grouting, production mining with long hole equipment and hauling, shotcrete applications and other underground civil works. GRUPO EMO´s focus on professional capabilities in safety and reliable operation and the continuous formation process of our staff, adds to our company´s inventory a steadily enlarged knowledge as well as personal attitude, loyalty and high quality standards, as the most important values we are transferring to our client.

GRUPO EMO has been the pioneer introducing professional underground construction in tunneling and mining in Central America obtaining a sound reputation for its professional engineering capabilities, development of human resources and total commitment to safe and secure working environment. GoldCorp and its local representative Montana Exploradora have recognize this kind of support and continues to contract additional tunnel construction with a full program of wire mesh and split set installation. We are also looking forward to serve as hauling contractor for the open pit re-naturalization program. We feel fortunate and proud to form part of the GoldCorp/ Montana family for the last eight years and we look forward to continue our successful cooperation in the future.

E. info@grupoemo.com www.grupoemo.com

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“It took less than five years for Goldcorp’s Marlin Mine to produce its one-millionth ounce of gold” this day the company continues to have a positive impact on the lives of families in the area through the creation of increased health, economic, educational and social opportunities. Furthermore, of the mine’s

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1,905 workers, approximately 98 percent of these are Guatemalan residents.

These employees operate each day knowing they are protected by Marlin’s stringent health, safety and environment rules and

Goldcorp - Marlin mine

Nursery environment

standards. Indeed, the safety culture one will find present at the mine has benefited hugely from countless successful safety initiatives that have been implemented throughout the years, including daily and weekly safety briefings, monthly inspections and ongoing training programmes.

The mine also operates in full compliance with the environmental standards and regulations of Guatemala and to the mining industry guidelines as set out by the World Bank. Furthermore, Marlin adheres to the internal Goldcorp standards in order to

ensure that the highest level of environmental stewardship is achieved. Marlin’s Environmental Management System (EMS) is designed to promote continuous improvement in the environmental management of the operation. The EMS concentrates on four phases, those being policy and planning, implementation, evaluation, and review and Improvement.

Of equal significance is the fact that Marlin holds the distinction of being the first mine in Central America to become fully certified under the International Cyanide

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Goldcorp - Marlin mine Management Code, which is recognised as the international benchmark for transporting, storing and using cyanide.

However, long before any Goldcorp mine commences with production the company will have already put plans in place for its eventual closure and the subsequent reclamation of the land. The Marlin Closure Plan for the open pit and waste rock storage facility was approved by the Guatemalan Ministry of Environment and Natural Resources (MARN) in October 2012.

Goldcorp’s wholly owned subsidiary, Montana Exploradora de Guatemala,

A local farmer

Everlife EVERLIFE is a Guatemalan firm with 10 years of experience, dedicated to provide consultancy and assessment, with the highest professionalism and quality, in environmental, social and business management issues.

We are conformed by a multidisciplinary team of professionals with extensive experience in extractive industries, renewable energy and transmission and distribution of electricity, among others. Our reputation has given us the opportunity to serve some of the most important and largest companies and projects in Guatemala. We are proud to serve Goldcorp and to be able to contribute, through our services, to the sustainable development of mining activities in the country. One of our most important projects is the Environmental Impact Assessment study (EIA study) that was prepared for the Technical Closure of the Marlin Mine Open Pit, which was the first

environmental instrument of its kind analyzed and approved by national authorities. We have also worked on EIA studies for mineral exploration licenses and permits.

Guatemala is a country rich in cultural diversity, conformed by 24 ethnicities and the same number of languages. This is a very important part of our expertise, due to the fact that in many projects there is a need to carry out the Public Participation Process with different ethnical groups at once. At EVERLIFE we know our business and we understand how vital this is for your investment and that´s why we offer integral solutions, supported with the use of top of the line technology and equipment, approved and recognized by international environmental agencies.

E. flopez@everlifegt.com www.everlifegt.com

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T H E E X T R AC T I O N O F G O L D A N D S I LV E R With Guatemala having many valuable natural resources, Productos del Aire can highlight the extraction of gold and silver, among others.

M.Sc. Juan Ram贸n Pallais | Special Applications Advisory | Guatemala Air Products, Inc. Phone 2421-0400 Ext. 227 | jrpallais@productosdelaire.com www.productosdelaire.com

Goldcorp - Marlin mine

Mine entrance

submitted the corresponding compliance bond to the MARN in the amount $28 million on October 16, 2012. The closure compliance bond amount established with MARN will be adjusted according to actual conditions and as subsequent sections of the closure plan are updated, reviewed and approved by the MARN. Subsequent sections of the closure plane will be updated as required by the MARN. The geochemical, hydrological and geotechnical assessments required for the Tailings Impoundment Closure Plan was conducted during 2013, and a final plan is expected to be submitted to the authorities before the end of 2014.

Productos Del Aire De Guatemala The extraction of gold with cyanide seeks to convert insoluble gold in complex metal anions soluble in water.

After being removed and crushed, the mineral is separated from the sludge by Elsner’s equation adding cyanide and oxygen.

The “Elsner” chemical equation is: 4 4 Au + 8 NaCN + O2 + 2 H2O Na[Au(CN) 2] + 4 NaOH Cyanide is present as potassium, calcium or sodium cyanide and is essential to avoid gasification, because cyanide is highly toxic: HCN(g) NC-(aq) + H+(aq) Therefore, it is necessary to maintain an alkaline pH throughout the process.

Calcium carbonates are added to keep alkaline water.

After the gold extraction, the “water process”

has to be neutralized before download to the environment.

Productos del Aire is making this neutralization applying gaseous carbon dioxide disolved in the “water process”: CO2 (aq) CO2(g) Which then reacts with the carbonates: Ca2+ (aq) + 2 CaCO3 + CO2 (aq) + H2O HCO3- (aq) And with water to create carbonic acid: H2CO3 (aq) CO2 (aq) + H2O Therefore, a simple application of CO2 gas bubbling in “water process” makes the water pH initially alkalines by the carbonates that reach normal levels without complicated mixtures of chemicals in the water. www.productosdelaire.com

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Industrial, Mining & Food Industry Since its formation in 1985, Grupo DISOSA has been dedicated towards the marketing of chemical products for the industrial, mining and food industry sectors, delivering the highest standards of products and quality of service. Grupo DISOSA is headquartered in the city of Guadalajara, Jalisco, Mexico and has branches in the Mexican states: of Baja California Norte, Chihuahua, Coahuila, Sonora, Zacatecas, Mexico City and in Guatemala in Guatemala City.

Contact Numbers: 52 (33) 3145-�0555 | 52 (33) 3881-�1270 Sales Management: alejandro.cota@disosa.com Mining Management Area: luis.escobedo@disosa.com

www.disosa.com

Goldcorp - Marlin mine

The processing plant

Another part of Marlin’s internal structure is its Sustainable Development department.

It is this area of the business which provides resources and funds for community development initiatives in communities near the operation and along the access road to the mine through its Organizational Development Unit.

Each project is designed, selected and implemented in conjunction with community

leaders and members. The Sierra Madre Foundation (SMF) is a Guatemalan foundation, funded by Goldcorp, which was formed in an effort to contribute to the development of neighbouring communities. Its mission is to assist with the planning and implementation of sustainable, community-based development and capacity building programs in San Miguel Ixtahuacán and Sipacapa.

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Tilapia fish project

Goldcorp - Marlin mine

2,000 tonnes Of ore produced by Marlin’s underground operation every day In early 2012, open pit operations at Marlin ceased when the mining of the final, highergrade portion of the pit was completed. Today the mine is an underground operation only.

Underground operations at the site employ mechanised cut-and-fill and long hole stoping mining, with underground loading equipment feeding haul trucks that transport the ore to the surface via ramps. Production from underground operations is roughly 2,000 tonnes of ore per day. This ore is processed in a conventional crushing, grinding and milling circuit. Marlin also has a tailing storage facility, a waste rock storage area and various ancillary installations.

Despite open pit operations coming to an end, successful exploration activities in the area surrounding the pit indicate the potential for extending the life of the mine.

The discovery of a bonanza grade vein, the Delmy vein, which is located near the Marlin deposit and within the existing mining area, will contribute significantly to the mine’s future production.

For more information about Goldcorp - Marlin Mine visit: www.goldcorpguatemala.com

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EXSA Peru

Creating

exact solutions In expanding its value proposition, EXSA is positioning itself to remain as influential to Peru’s mining sector as it has been for the last six decades

written by: Will Daynes research by: Abi Abagun

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EXSA Peru

F

ounded in 1954, EXSA Peru is reuse of waste oil in blasting, elimination today part of Breca, the leading of red fumes from blasting operations and economic group in Peru, and is so forth. To achieve this we have invested the country’s leading provider of heavily in technological innovations, while rock fragmentation solutions to the at the same time deepening the expertise mining and construction industries, with more and development of our staff through than a 50 percent market share. The company’s comprehensive training. Furthermore, we are market leadership is reflected in both its introducing automation into our production recent sales growth and its earnings before processes in order to improve our existing interest, taxes, depreciation and amortization safety critical processes.”

(EBITDA). Over the last five years EXSA’s sales In order to provide its customers with have increased by an average of 23 percent per the best solutions EXSA took the decision to year, while in the same period its EBITDA has segment its market according to the type of seen more significant growth of approximately operation carried out by said customers. These 25 percent annually. segments include open pit It has become such through mining, underground mining, is pioneering development quarries and construction and commercialisation of a companies. Among its open wide assortment of products pit customers are the likes i nc ludi ng dy na m ites, of Antamina, Yanacocha, The year EXSA cartridged emulsions, ANFO, Goldfields, HudBay and was founded bulk emulsions , ammonium Southern Copper, while when it nitrate and a full range of comes to underground mining initiators. The sales of the aforementioned they include Buenaventura, Volcan, Hochschild products are in turn boosted through the Mining, Minsur, Horizonte and Marsa, and in providing of technical assistance and training the construction market customers include services centred on the proper selection, safe Graña y Montero, Odebrecht and others.

With no real substitute available on handling and use of EXSA’s products.

“Utilising our 60 years of experience,” the market to match the volume of rock states CEO, Karl Maslo, “we have recently fragmentation it creates, it is understandable been modifying our focus and market why wide-scale mining today remains virtually orientation, expanding our value proposition impossible without the use of explosives. Over to our customers from products and the course of its six decades of existence, EXSA operational services to tailor made solutions, has proudly retained a reputation for not only which we have called “exact solutions”. Such the quality of its products, but also for its solutions include the construction of powder attitude towards safety. magazines and nitrate storage facilities, “At EXSA we recognise the high level of risk as well as conducting secondary drilling, that is linked to our activities and therefore

1954

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EXSA Peru we have made it our mission to ensure that the concept of safety runs through our DNA,” Maslo continues. “Our level of safety awareness is such that each year our annual celebration schedule includes the EXSA Safety Day. This day represents the only date, other than official holidays of course, that the company puts work on hold in order to commit the day towards allowing all of our employees and collaborators to be trained in and strengthen their already comprehensive knowledge of safety.”

The contribution of said people to the

success of the company of course has to be recognised, the level of which stems from their enjoyment and satisfaction of being a part of EXSA. “The commitment of our people is reflected in the high score we obtained in a recent Great Place to Work study, which makes EXSA the highest rated explosive company for employee satisfaction in Peru,” Maslo says. “On the subject of awards it was last year that we also received Class A certification from the consultant Oliver Wight for Process Planning and Control. With this recognition EXSA

AEL MINING SERVICES AEL Mining Services, a member of the JSElisted AECI Group in South Africa, is a leading developer, producer and supplier of 3rd generation electronic detonators, initiating systems, blasting services and solutions for mining, quarrying and construction markets in Latin America, Africa, Europe and the Far East.

AEL operates closely with selected partners across Latin America and is proud to be associated with Exsa, AEL’s preferred partner and distributor in Peru of electronic detonators including DigiShot™Plus and SmartShot™ range, as well as Underground Bulk Systems (UBS) for more than 12 years.

Consisting of a capable team of leading explosives engineers and scientists, AEL has over a century of expertise and knowledge in developing ground-breaking and innovative

blasting solutions that contribute to the creation of infrastructures in countries throughout the world. AEL supports Latin America’s growing mining market and will continue its investment on the continent through its expertise, resources and cutting edge technology.

AEL’s proven capability of deploying infrastructure to global standards in a fast turnaround time, coupled with the expertise to rapidly develop customised premier products to suit specific applications and mandatory quality standards, gives the group a competitive edge in expanding into new markets.

AEL unearths wealth by meticulously providing the mining industry with carefully controlled energy. www.aelminingservices.com

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inspired Your weekly digest of business news and views

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became the first explosives business in Latin America, and very few in the world, to have obtained this certification.”

For the last 60 years EXSA has undoubtedly contributed a huge amount to the sustainable development of the mining industry in Peru. In looking back on its impact on the sector it was decided that its 60th birthday would be the ideal time to redesign its corporate image, one which reflects a new vision for the company and a new approach to how it delivers its service. This new image was first unveiled at the EXTEMIN 2013 mining exhibition.

“We want our customers today to not simply see us as providers of products or operational services that are limited to blasting,” Maslo

EXSA Peru

“We believe in long term relationships and that is why we care about ensuring the continuity of our customers’ businesses” highlights, “rather we want them to recognise EXSA as providers of exact solutions that are integral to their entire value chain. We view the business of our clients holistically and as such we want to focus on capturing operational efficiencies in their production chain. We believe in long term relationships and that is why we care about ensuring the continuity of our

customers’ businesses. By knowing the business of our customers better than themselves, we will be able to provide them with tailor made solutions beyond their expectations.”

“It is EXSA’s belief that sustainable development and steady growth should be constant goals and as such we seek at all times to uphold best practices when it comes

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“As part of our development over the past 60 years we have grown into a multi-national company” to achieving continuous improvement and delivering total quality and excellence. In recent years we have invested heavily in order not only to respect the environmental laws, but also to exceed the mere fulfilment of our obligations, thus becoming a leader in our industry,” Maslo enthuses. “Moreover, since 2004 we have held ISO 14001 certification and OSHA 18000 certification since 2008, and in 2003 we obtained the ISO 9001 certification. These certifications require us to have procedures and evaluation methods in place to identify and eliminate any potential environmental or safety implications our operations may have. Our degree of social responsibility also saw us become the first blasting company in Peru to receive the distinction of being recognized for our role in this field by being named an Empresa Socialmente Responsible (socially responsible) business.”

EXSA’s goal for the short-to-medium term is to continue to grow and consolidate its position as the leading regional player in the mining industry when it comes to rock fragmentation. One way that the company is expressing its aims for the future is through the design and use of a dynamic new logo, one that represents the company’s new value proposition, its continuing high levels of customer focus, its constant process of

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innovation and the way it is always striving to meet its clients’ changing needs by providing them with exact solutions. The colour blue represents the level of trust, confidence and commitment that exists between EXSA and its clients, while the yellow symbolises the human side of the business and the close relationships EXSA forges with its customers.

“As part of our development over the past 60 years we have grown into a multi-national company which today has subsidiaries in Brazil, Colombia and Panama, and exports products from Peru to the majority of the countries in South, Central and North America,” Maslo concludes. “Our growth strategy for the future revolves around three strategic pillars, innovation, customer focus and solutions, all of which are furthered as a result of our proven operational excellence, quality, efficiency and safety. Meanwhile, we have developed a very aggressive growth strategy across the Americas, one that has proven to be very successful, and we move into our seventh decade of operations we will continue to look for business opportunities both locally and internationally.”

For more information about EXSA Peru visit: www.exsa.net

EXSA Peru

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Alamos Gold

A track record to be proud of John A McCluskey, President, Chief Executive Officer and Director of Alamos Gold, discusses the secrets behind the company’s success and how its commitment to responsible mining has improved the lives of many

written by: Will Daynes research by: Peter Rowlston

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Pouring gold at the Mulatos Refinery

Alamos Gold

W

hen I look over the last two years, while I do see a highly problematic gold market, particularly for producers, I also see evidence to suggest that the long-term outlook is pretty good. Primarily this is because many of the underpinning reasons for the rise in gold price in the first place continue to exist, reasons like high degrees of sovereign debt.�

Those are the words of John A McCluskey, President, Chief Executive Officer and Director of Alamos Gold. Having begun his career in 1983 with Glamis Gold, McCluskey would go on to hold senior positions in a number of public resource companies, founding Grayd Resource Corporation in 1996, and ultimately establishing Alamos Minerals. It was the amalgamation of Alamos Minerals and National Gold on 21 February, 2003, that gave rise to Alamos Gold itself.

A Canadian-based mid-tier gold producer, Alamos’ core focus is to become a leader in the field of growing low-cost gold production, in financial performance and in delivering shareholder value. The company owns and operates the Mulatos Mine, located within the Salamandra Concessions in the Sierra Madre Occidental mountain range in the north western state of Sonora, Mexico. Acquired by the company in February 2003 for $10 million, Mulatos is a conventional open-pit, heap leach operation and is recognised as being one of the lowest cost gold mines on the planet. In addition to the Mulatos Mine, Alamos also boasts a leading growth profile with exploration and development activities not only in Mexico,

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Alamos Gold

Overview of Mulatos crushing circuit

but also in Turkey and the United States.

Turning back to the topic of the gold industry as it stands today, McCluskey’s belief is that the current gold market is simply not sustainable. “If you look at average all-in sustaining costs of the industry today, which don’t typically take into account taxation, with gold trading around $1,250 an ounce there is simply not enough of a margin present to sustain the industry. The result

of this situation will ultimately be either a rise in the price of gold or a significant decline in gold production.”

So given this outlook, how is it that Alamos is able to remain prosperous? “Where we have looked to make acquisitions we have always done so with the view of all-in sustaining costs being below $1,000 per ounce,” McCluskey continues. “This provides us with a much more comfortable margin than that

“The work of Alamos to provide a better quality of life for the communities living around its operations continues unabated” be americas | 87

Mulatos Crushing Circuit

which the typical industry producer enjoys and means we can effectively withstand a drop in the price of gold much better than such producers. It also means that our suite of projects exists as one of the lowest cost development pipelines in the industry and that is a very unique, strong position to be in, in anyone’s book.”

The Mulatos Mine is some way removed from being a development asset, but its on-going success marks it out as being the flagship of Alamos Gold. “When we started operations at Mulatos in 2005, we had roughly nine years of production ahead of us, an

estimate calculated off the back of running at 10,000 tonnes of ore per day,” McCluskey highlights. “At that rate we should have run out of ore in 2013, however successful exploration and expansion programmes allowed us to ramp up production to 13,000, 15,000 and now 17,700 tonnes of ore per day, and now we anticipate having a further eight or nine years of mine life ahead of us.”

A number of important factors have contributed towards the extension of Mulatos’ mine life. These include the fact that the ore body was not fully defined when Alamos began mining it and the fact that when the

“As a company, and an industry, we want to operate in ways that are environmentally sustainable” 88 | be americas

Alamos Gold

17,700 tonnes Of ore being produced daily at Mulatos

company conducted its first economic study on the mine the gold price stood at around $375 an ounce. As gold prices increased the company was then able to use lower cut off grade assumptions allowing for much more of the material it was defining to become part of its reserves. Furthermore, the Mulatos pit contains a variety of ore types, some of which wouldn’t have qualified as reserves at lower gold prices, but are now profitable.

The Mulatos mine and its surrounding area is today very much a different place to that which Alamos first entered over a decade ago. Miles away from any built up modern location, Mulatos is a remote community that prior to 2003 was essentially cut off from the rest of Mexico and was a town lacking in transportation networks and other infrastructure.

“Infrastructure has been one of the biggest things we have invested in since beginning operations here,” McCluskey enthuses. “A large sum of money went into the construction of 70 kilometres of road, from the pre-existing paved highway through several mountain valleys all the way to the mine itself.”

Of course being a responsible mining company takes more than single gestures and to this end the work of Alamos to provide a better quality of life for the

John A McCluskey

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Mulatos Leach Pad Reclamation

Alamos Gold communities living around its operations continues unabated. In addition to providing support for a number of local elementary and high schools the company continues to pursue an aggressive scholarship programme that has to date sent dozens of individuals into higher education.

The company is also responsible for building a medical support network from the ground up in the area. “Before we arrived in the area there was virtually no medical support for miles around,” McCluskey states. “In the event of an emergency people would face up to a six and a half hour drive to the nearest hospital.

What we have done is establish a medical clinic at the mine, which has been delivering comprehensive medical care now for more than a decade. In addition we have provided funding for medicine for the local population, rebuilt and maintained 8 kilometres of piping to supply clean drinking water to the town of Mulatos and built a water treatment plant, significantly improving the water quality of the nearest natural water source to the community.”

Alamos’ track record in delivering value not only for its shareholders but also local communities speaks for itself, and McCluskey believes that it is one that is widely replicated throughout an industry that should do more

Mulatos Heap Leach Pad

to defend itself against critics. “The basis of virtually every economy comes down to natural resources and their development, therefore the importance of mining cannot be overstated. While there have obviously been examples of environmental degradation in the past, I would say that the industry, especially in the 30 years that I have been a part of it, has had an exemplary record.

As a company, and an industry, we want to operate in ways that are environmentally sustainable. I think this industry needs to make this point much clearer.”

For more information about Alamos Gold visit: www.alamosgold.com

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Bette Plant

Reliable Contro plant automatio work, par

r

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Reliable Controls

er Controls and t Commissioning

ols Corporation is a dependable partner for on, assessment, auditing and commissioning rticularly in mining and O&G projects

written by: John O’Hanlon research by: Peter Rowlston

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Gold and copper recovery in the Dominican Republic

Reliable Controls

E

d Macha always felt there was a better way. Fascinated since childhood by the possibilities of automation, he learned the industry inside and out, knowing one day he would be the one to transform it. Beginning at the age of 15, he spent his summers sweeping electrical room floors and troubleshooting pull cords on conveyor belts at a mine site in Mexico. After graduating in electrical engineering from New Mexico State University, Macha worked as a control engineer, taking on numerous jobs including a large commissioning project working with Bowen Engineering and Fluor Daniels in the multi-million Alumbrera project in Argentina.

Five years later, there was a delay in projects and Ed realized that was the time to jump on the idea he never stopped dreaming about.

The opportunity to start his own business.

With the support of his father, Al Macha, and younger brother Alex Macha, who are now respectively RCC’s Vice Presidents in Operations and Technology, Ed Macha developed a unique method for systemizing power, instrumentation and control systems in a way that could make projects more efficient during commissioning. With the implementation of this new way and the support of a few key people, Reliable Controls Corporation (RCC) was born in April of 1999.

The primary focus of RCC was the mining industry. The company’s first big break came within months of being established, with the challenge to automate a tripper conveyor control system at a mine that used lasers for control and optimisation. This was followed by another large project performing

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a complete Instrumentation and Controls audit and assessment in 2001 at Minera Escondida’s concentrator. The next few years brought nothing but opportunity and growth for the flourishing company. In 2002, RCC performed the commissioning and start-up of the Power Distribution Systems and Controls Systems for BHP Billiton at Minera Escondida’s Phase IV megaproject.

That success attracted the attention of other major clients and the company grew fast. In 2004, RCC had reached eight employees, at which point it expanded its operation in Salt Lake City: since then it has experienced steady growth and today has 53 employees.

If there’s a key to this business, it lies in the commitment of its staff. With an average age of 38 the team includes seasoned engineers with the ability to manage large teams, a middle generation in their thirties, highly tech-savvy and bright, and the youngest generation in their 20s, many of whom joined RCC straight from university, eager to learn and willing to work hard to get where they need to be. “It’s a very constructive combination!” says Macha. “We have great leaders in all of those age groups.”

The company’s portfolio developed quickly, with satisfied clients in both the mining and the oil and gas (O&G) sectors. RCC is

a perfect fit with businesses in these two sectors – companies that are in the process of building new facilities and clients that are reassessing their existing facilities. This was always the basis for building the firm’s reputation, he says. “We build trust, respect and unity. We become family with our clients, making it a win-win situation. To do this, we train and develop as much as we can. We value our people’s experience and give them

“We build trust, respect and unity.

We become family with our clients, making it a win-win situation. To do this, we train and develop as much as we can” 96 | be americas

Reliable Controls

Copper and gold underground mining in Indonesia

training, so we are offering design, installation and our clients continuing commissioning in each expertise. The world faces of them. “We focus on a crisis of resources right understanding our clients’ now and the type of work needs,” he emphasises.

RCC’s foundation year we do on power systems, “For example many of instrumentation, automation them need to modernise or and commissioning is huge upgrade their facilities after in fixing that crisis. RCC is developing a long period of operation – they might and training the next generation to step not even have the original documentation, up and resolve the crisis.” The company’s drawings and commissioning information. record of growth by recommendation and So the first thing we will do is to make an the long term relationships it has built audit of the whole installation. We trace with mining and O&G majors testifies every wire, and create plant drawings to the success of this approach. and documentation that may be missing RCC’s engineers are experienced in or out of date: in short, we tell the client both understanding the synergies as well exactly where their plant is at!”

RCC’s qualified engineers then use as the unique characteristics of plant

1999

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a proprietary system to pinpoint potential opportunities and offer detailed recommendations for creating more favourable conditions with little to no downtime. “The system breaks the job down into work packages: our engineers go through the entire plant and give the owner a snapshot of every last detail of his instrumentation, automation and electrical installation.”

Having established the baseline, RCC goes on to make its recommendation of what needs to be done to upgrade and improve safety or compliance. A great example of this service was shown in 2009, when Barrick Gold contracted RCC to provide electrical and instrumentation assessment and ‘as-built’

Copper thickener in the Atacama Desert, Chile

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engineering services at the Cortez Pipeline Mill located 60 miles south west of Elko, Nevada.

RCC performed a detailed electrical and instrumentation assessment including verification and wire tracing, as well as providing ‘as-built’ documentation. ‘As-built’ means assessing the variations from original engineering plans to what was actually built – and any subsequent modifications. Without this, it is impossible to plan any future development. At Cortez Pipeline Mill, wiring, drawings, motor schematics, instrumentation, controls and electrical systems were all audited and the client presented with a turnover package and recommendations related to safety and reliability, critical

Reliable Controls

“We trace every wire, and create plant drawings and documentation that may be missing or out of date: in short, we tell the client exactly where their plant is at!” instrumentation and logic, and electrical and instrumentation component conditions with respect to both safety and functionality.

A job well done, which developed into a continued relationship with Barrick and work in major projects world-wide, including being a key partner in the Pueblo Viejo mega project (2011-2013) in the

Dominican Republic where RCC provided pre-commissioning and commissioning services for both Fluor and Barrick.

Another core service that has really made its mark on the mining industry is testing and commissioning. This can be applied to a simple standalone plant or complex site-wide systems. “We place a lot of emphasis on that, and have developed a systematic approach to commissioning that is as foolproof as we can make it,” says Ed Macha. He is referring to the in-house software application that covers the whole process of verifying and validating the plant and getting it up and running. The company has been busy in its home state (Utah), Arizona, and Nevada, last year completing commissioning services for Freeport McMoRan, Barrick, and Rio Tinto.

Currently, the company is in the commissioning process for the $160 million gyratory crushing system and 21,500 gallons per minute Merrill-Crowe facility at Allied Nevada’s Hycroft gold mine.

RCC is providing services to complete all electrical and instrumentation terminations and performing component testing and plant commissioning. The systematised approach by project manager, Jeff VanDyke, and team of 20 has made a substantial difference in the project.

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Another aspect Reliable Controls prides itself in is that of forging innovative technology. RCC has just launched a new application called PlantSight (www.plantsight.com) based on its unique system which is now available to purchase by anyone. This tool is cloud-based and utilises iPads and laptops to perform all inspections, punchlists and test package completion. The key is to

have immediate information available for tracking, making decisions, early discovery and accountability based systems required for the commissioning of world-class facilities.

“This tool is great for tracking real time progress, and generating online reporting,” Ed Macha enthuses. “The system aims to improve efficiencies, reducing re-do work and improving the reporting process, all of

“PlantSight is a great tool for tracking real time progress, and generating online reporting”

RCC management - Fred Botha, Alex Macha, Al Macha, Nikki Butler, Ed Macha, Brad Liljenquist

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Reliable Controls

RCC engineer, Michael Toone, utilizing PlantSight while commissioning

which help to meet project deadlines. I truly believe RCC understands the importance of technology and is one of few businesses in the industry that are capitalising on it!”

With offices already established in the USA, Chile and the Dominican Republic RCC is now setting up shop in Peru and Indonesia. “We will go wherever our clients need us,” says Macha – and he makes it clear that though he is currently focused on South East Asia and South America, Australia and Canada are definitely of interest, and that the logical progression going forward will be a big push into the energy sector. The latest international venture in Indonesia has proved RCC’s ability to work with a 14-16

hour time difference between the site and the engineering companies/suppliers in North America, as well as the logistics challenge.

Though his clients agree that RCC holds the key to the best available plant assessment and commissioning, Ed Macha still thinks there is a better way. “We do our work with so much pride. Everything we do is beautiful. It is a work of art. We all believe in doing a job with passion! We cannot stand mediocrity - there is always the challenge to do it better!”

For more information about Reliable Controls visit: www.rcontrols.com

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PREPA – Puerto Rico Electric Power Authority

Bringing change to the Caribbean As Executive Director, Juan F. Alicea Flores discusses, Puerto Rico’s principle electricity provider is moving forward with game-changing plans to shift the island’s dependence from petroleum products to natural gas and renewable energies

written by: Will Daynes research by: Abi Abagun

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L

ocated to the east of the Dominican Republic and to the west of the Virgin Islands, the Commonwealth of Puerto Rico is renowned for its exotic locations, white sandy beaches, mountains, valleys and various natural splendours. Classified by the World Bank as a high income economy and as the most competitive economy in Latin America by the World Economic Forum, it also boasts the highest GDP per capita of any other nation in the Caribbean.

It is also in Puerto Rico where the island nation’s electric power authority, PREPA, is working diligently to usher in a new era of energy usage that will greatly benefit not only Puerto Rico but the region as a whole for generations to come.

“The biggest challenge we face today as a nation is the high cost of electricity,” states Executive Director, Juan F. Alicea Flores.

“As the only energy supplier in Puerto Rico it is our goal to reduce these costs.

We currently have a number of important projects taking shape across Puerto Rico, one of which involves the development of the infrastructure necessary to receive natural gas, specifically the creation of a major floating storage facility and the converting or replacing of 14 power generation units.”

Founded in 1941, PREPA is responsible for providing electric energy to its customers in the most efficient, cost-effective and reliable manner possible. Today it produces, transmits and distributes virtually all the electric power used in Puerto Rico. PREPA’s workforce of approximately 8,240 employees are spread across various operational and support areas

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PREPA – Puerto Rico Electric Power Authority

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Email: enquiries@pumaenergy.com | www.pumaenergy.com

PREPA – Puerto Rico Electric Power Authority Puma Energy Caribe tempor incididunt ut labore including generation, transmission and et dolore magna aliqua. Ut feature text environmental to go here... protection and distribution, Lorem ipsum dolorand sit customer amet, enim ad minim veniam, quis planning, finance service, and consectetur adipisicing elit, nostrud exercitation ullamco human resources. laboris nisi ut aliquip ex sed“Puerto do eiusmod temporportfolio today Rico’s energy incididunt doloreof demand for ea commodo consequat. highlightsutalabore high etlevel magna aliqua.

Ut Alicea enim ad Duis aute irure dolor in petroleum fuels,” continues. “What minim quis nostrud reprehenderit in voluptate we at veniam, PREPA want to do is reduce this exercitation ullamco velit esse cillum dolore dependence on oil andlaboris transfer it to cleaner, nisi ut aliquip ex easuch commodo eu fugiat nulla pariatur. cheaper sources as natural gas. We consequat.

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Excepteur stands at 28 percent, coal 16 mollit anim id est laborum. Lorem ipsum dolor sint occaecat cupidatat energy non proident, sunt sit amet, consectetur adipisicing elit, sed do percent and renewable one percent. in qui officia mollit anim in id eiusmod tempor incididunt ut labore et dolore It isculpa our aim to havedeserunt a situation whereby est Lorem has ipsum dolor sit as amet, Ut enim ad minim quis 2017laborum. oil dependence fallen as low two magna aliqua.

Executive Director Juan F.veniam, Alicea Flores consectetur adipisicing elit, sed do eiusmod nostrud exercitation ullamco laboris nisi ut

PUMA ENERGY We are a global energy business delivering high quality fuels safely, swiftly and reliably at a fair price. A professional energy business taking great pride in our work. An ambitious energy business, growing fast by answering the unmet energy needs of markets across five continents in over 35 countries.

With over 6,000 employees, we bring secure, safe and affordable fuels, lubricants and other oil products to millions of business and retail customers every day. Our storage, refining, supply, retail, business to business, wholesale, aviation, bunker and LPG businesses help to fuel growth in frontier markets.

At the heart of Puma Energy is a simple imperative- to always exceed our customers’ expectations.

Meeting our customers’ needs in full is just a starting point. Our brand stands for something extra, for added value that delights customers, so they trust us and choose our products and services time and time again.

Added value means different things to different people, but there are consistencies in the way we make it happen. It starts by setting high safety standards and delivering excellent service, always personal and frequently unique to a single customer. It requires speed of thought and response, plus the right balance of flair, innovative thinking and solidity.

WE ARE PUMA ENERGY. www.pumaenergy.com

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percent and natural gas, which by that point will be the primary fuel in our generation systems, will have risen to 72 percent.”

Look closely and you will see that the moves made by PREPA are already starting to make a difference. At the beginning of 2013 the cost of energy on the island was recorded at 30 cents a kilowatt. Today it

stands at 25.5 cents per kilowatt and Alicea is convinced that by the time PREPA has its entire network of infrastructure up and running in 2015 the cost will have fallen to 22 cents per kilowatt.

With such ambitious targets to aim for it will be of little surprise to find that PREPA is already hard at work putting the

“Puerto Rico’s energy portfolio highlights a high level of demand for petroleum fuels”

Energy Control Center

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PREPA – Puerto Rico Electric Power Authority

Workers attending to a power outage

infrastructure it needs in rest of the United States will place, with work currently welcome the introduction of focused on the south of the new Federal Air Regulations, island. The south presents the legislation that will target best opportunity for PREPA the amounts of particulate to initiate the construction released into the atmosphere. phase of its plans by the end of In preparation for this PREPA 2014, in advance of its target also has a number of other Amount being invested to start receiving natural clean energy projects in into transforming Puerto gas by 2015. The north of operation across the island.

Rico’s energy mix in 2014 the island in comparison is a These include a 75MW wind farm which is integrated much more complex area to work in, what with it being home to Puerto into its power network and a 20MW solar Rico’s major metropolitan centres and prime energy project. This is just the beginning tourist locations. Nevertheless, PREPA is however what with PREPA planning to have adamant that despite this, natural gas will added an additional 400MW in renewable be circulating the entire island by 2017. power by the end of 2014 alone.

From April 2015, Puerto Rico and the “As well as recognising the need to

$300 million

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Puerto Rico Electric Power Authority Main Building

“What we at PREPA want to do is reduce this dependence on oil and transfer it to cleaner, cheaper sources such as natural gas” integrate natural gas and existing renewable energy sources into our energy portfolio we also have one eye on the incorporation of less established technologies that we believe will grow in importance in the years to come,” Alicea explains.

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One such example of these less established technologies is the use of Ocean Thermal Energy Conversion (OTEC). OTEC uses the temperature difference between cooler deep waters and warmer shallow waters to power heat engines which in turn produce

PREPA – Puerto Rico Electric Power Authority

Optic Fibre line installation

electricity. “Due to the geographic nature of Puerto Rico we have an incredible opportunity to capitalise on this rapidly developing technology,” Alicea enthuses.

With a budget that exists independent from Puerto Rico’s central government, PREPA plans to invest as much as $1,500 million over the next five years into transforming the island’s energy mix, $300 million of which will be spent in 2014.

“PREPA has always employed the very finest technicians and individuals who specialise in identifying future trends and how best to approach them,” Alicea

Costa Sur

concludes. “It is these individuals who will continue moving PREPA forward in its integration of a more varied energy mix and I believe that when we look back on all this in 20 years’ time we will all be extremely proud of what we achieved and how that has impacted the lives of future generations of Puerto Ricans and their Caribbean neighbours.”

For more information about PREPA – Puerto Rico Electric Power Authority visit: www.prepa.com

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Moving

Mexico forward Mexico’s largest enterprise and biggest taxpayer intends to invest a record amount in 2014 in order to maintain its position among the world’s elite oil companies

written by: Will Daynes research by: Abi Abagun

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Petroleos Mexicanos - PEMEX

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Petroleos Mexicanos - PEMEX

O

In order to achieve its aims PEMEX relies ne of the select few oil companies in the world to upon the expertise of its various subsidiaries operate through the length and affiliated companies, PEMEX Exploration and breadth of the industry, and Production, PEMEX Refining, PEMEX from exploration and Gas and Basic Petrochemicals , PEMEX distribution through to the commercialization Petrochemicals and PMI Comercio of the end products, Petroleos Mexicanos, Internacional. PEMEX Exploration and or PEMEX as it is better known, is Production is the body tasked with Mexico’s biggest enterprise, the largest maximizing the long term economic value of taxpayer in the country and one of Latin Mexico’s oil and natural gas reserves. Its main America’s largest companies. activities include exploration, transportation, Created in 1938 through the nationalization storage and the marketing of terminals. of petroleum and the expunging of all The basic functions of PEMEX Refining private foreign and domestic on the other hand include companies at the time, industrial refining processes, PEMEX today boasts a total the processing of petroleum asset worth of $415.75 and petroleum products, billion, making it the d i st r ibut ion, storage and first-hand sales. world’s second largest nonPemex Gas and Basic publicly listed company Petrochemicals (Pemex by total market value. In The record amount Gas) is the subsidiary of recent years the company’s PEMEX is to invest in its PEMEX responsible for the crude oil production levels operations in 2014 processing, transportation have remained stable with and marketing of natural gas, it producing 2.548 million barrels per day in 2012, as well as just over liquid hydrocarbons and basic petrochemicals such as ethane, natural gasoline and six million cubic feet of natural gas.

PEMEX’s mission is to maximize the value sulphur. Meanwhile, PEMEX Petrochemicals’ of Mexico’s oil assets and hydrocarbons, main activities stem from the non-basic meeting the domestic demand for products petrochemical processes derived from the through reliable, quality, safe and cost primary processing of natural gas, methane, effective service. In doing so it aims to be ethane, propane and gasoline. Last, but recognized by the Mexican population by no means least, PMI is the commercial as a socially responsible organization arm of PEMEX on the international stage. striving to permanently increase the value With operations throughout the world of its assets, while remaining responsive, PMI handles the imports and exports of transparent and innovation in its operations crude oil to and from PEMEX’s operations.

As Mexico’s largest enterprise PEMEX and long term strategy.

$27.7 Billion

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CHEMISA, S.A de C.V CHEMICAL INDUSTRY

...Only Solutions®

Tel: 52+(55) 5557-0988 Email: carlos_maldonado@chemisa.com www.chemisa.com

CHEMISA IS YOUR RELIABLE SOLUTIONS SOURCE IN THE FOLLOWING AREAS: MAIN SERVICES • Consulting • Technical and economical feasibility studies • Estimated investment and cost analysis • Quality Assurance • Industrial safety • Energy Saving ENGINEERING SERVICES • Conceptual Engineering development • Basic Engineering development • Detailed Engineering development • Project management FIELD SERVICES • EPC projects • REVAMP projects • Turn key projects

PRODUCTS • Heat exchangers • Pressure vessels • Skid mounted separator packages liquid/gas and liquid/ liquid • Distillation trays • Random and structured packing • High efficiency column internals • Mist eliminators • High mechanical resistance refractory • Skid mounted separator packages (liquid/gas and liquid/liquid) CERTIFICATIONS: • ASME stamps R, U, U2 and S • ISO-9001 • CONACYT (Scientific and Technological National Council)

We do not just create the product… we design solutions

Congratulations PEMEX on your 75th Anniversary Telephone: 001 403 444-6853 Email: mcc@jvinternational.net www.mccpipelinesgroup.ca MCC complies with the DOT regulations resulting in Operator Qualification, customized to an individual company.

MCC Joint Ventures Canada International Inc. (MCC), in collaboration with our partners in the energy industry, has built training and assessment programs to offer the qualification and certification of craft professionals in the energy industry.

The shortage of skilled craft professionals is critical today; we encourage corporations to close the skills gap by maintaining safe and efficient operations.

Critical competencies require continuous upgrading!

Operator Qualification Services: Our instructors utilize the tools provided by NCCER training and assessment, EWN (Energy World Net), OQSG, Veriforce and MEA to conduct knowledge assessments and performance verifications for operator identified cover tasks.

• Gas Pipeline Operations • Liquid Pipeline Field Operations • Liquid Pipeline Control Center Operations • Pipeline Corrosion Control • Pipeline Electrical & Instrumentation • Pipeline Maintenance • Pipeline Mechanical • Written OQ Plans and regulatory support Safety • Field Safety • Safety Orientation • Safety Technology Management and leadership development • Fundamentals of Crew Leadership • Project Supervision • Project Management Construction • Pipefitting • Pipe layer • Rigger/Signal Person • Instrumentation • Welding Other services: • OSHA & Safety • Records Management • Contractor Management • Master Evaluator Certification New MCC area of expertise: Cooling Tower management & training

CRAFT PROFESSIONALS GENERATE EFFICIENCY & SAFETY

Petroleos Mexicanos - PEMEX carries with it a huge Chemisa amount of responsibility CHEMISA is a leading provider of effective, efficient when it comes to social and and reliable process solutions. For the last 14 years we sustainable development, have served the Oil & Gas, Chemical and Petrochemical and when it comes to industries with Engineering, Procurement, Construction, leveraging its petroleum Start-up and support services to their entire satisfaction. A based operations to help long list of successful installations backs up an increasingly beneficial relationship with PEMEX, based on quality, improve the living conditions responsiveness and trust. of the country’s population. www.chemisa.com As such PEMEX is a strong supporter and promoter of regional development initiatives, seeking at all times to harmonize its own growth with that of the areas in which it operates.

Such an attitude also extends to the company’s commitment towards developing itself in a sustainable, environmentally conscious manner. PEMEX considers itself to be among the most proactive of companies in the oil industry when it comes to conservation and ecosystem management, compensation and reclamation. Meanwhile, across its vast operations one will find a shared desire to ensure it succeeds in achieving increasingly efficient use of energy and water.

Today PEMEX finds itself one year into its “Business Plan for Petroleos Mexicanos and Subsidiary Entities 2013-2017”. The plan in question has been laid out to plot the course

“As Mexico’s largest enterprise PEMEX carries with it a huge amount of responsibility when it comes to social and sustainable development” be americas | 117

“Projected investment for this year will be 6.5 percent greater than the amount invested last year� of the company over the coming years so that if stays in line with its mandate to create value and achieve operational and financial sustainability in the long term.

In putting the plan together a total of 15 objectives were identified and grouped into four separate lines of action, those being growth, operational efficiency, corporate responsibility and management modernization. The objectives include increasing inventory revenues through new discoveries and reclassification, the increased

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production of hydrocarbons, increasing efficiency levels above international standards in gas usage and production costs, and achieving operating performance levels about the industry average when it comes to processing. Other continuously evolving long term aims include strengthening customer orientation, developing human resources, supporting growth and business improvement through the development of technology and maximizing the value of international opportunities.

Petroleos Mexicanos - PEMEX

This year the company plans to invest approximately $27.7 billion across its operations, the most in its history. The vast majority of this, 85 percent to be exact, will be put towards crude oil exploration and production. According to the company its projected investment for this year will be 6.5 percent greater than the amount it invested last year and a massive 154.1 percent greater than the investment made a decade ago.

Approximately $3.4 billion of this total investment fund will be used to build four new ultra-low sulphur diesel plants and modernize a further 14. The new plants will be built at three different existing refineries, Madero in the north-eastern state of Tamaulipas, Minatitlan in the Gulf

coast state of Veracruz, and Salamanca in the central state of Guanajuato.

Four other plants at the Salina Cruz refinery in the southern state of Oaxaca and the Tula facility in the central state of Hidalgo will undergo a thorough modernization process, while the remaining ten will undergo a less extensive renovation. The diesel project, which will take an estimated 45 months to complete and employ best industry practices, is to be coordinated by a specialized team from the company’s refining unit, Pemex Refining, and an external oversight body.

For more information about Petroleos Mexicanos - PEMEX visit: www.pemex.com

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Camanchaca

Feeding the world from the ocean Camanchaca’s quality fish products have made it a leading player on the international stage

written by: Will Daynes research by: Abi Abagun

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Camanchaca

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owadays, aquaculture is a major economic activity in Chile, due to its excellent geographic, climatic and water quality conditions.

In fact, by 2006 the country had risen to become the second largest global producer of salmon, behind only Norway, while in the case of mussels it retains its crown as the largest global producer.

Founded in 1965, initially with its focus being the fishing and processing of Langostino lobster and wild shrimp, Camanchaca underwent a significant change in 1980 when the company’s management pursued a strategy of diversification. This change saw the business expanding into aquaculture and subsequently Camanchaca has grown into an international entity with sales offices or brokerage representation in the US, Japan, Europe, and most recently in Mexico, China and South East Asia. Such is the importance of the distribution network that today Camanchaca exports its products to over 50 countries while aquaculture products account for over half Camanchaca’s revenues.

Today, aquaculture activities include salmon, mussels, scallops and abalone, while the fishing activities are focused on jack mackerel, sardines, anchovies and langostinos.

One of the world’s leading fishing, seafood and aquaculture companies, Camanchaca currently has annual sales of over $400 million.

In Northern Chile the company possesses a fleet of 16 fishing vessels, with a total hold capacity of 6,000 cubic metres and a modern plant with a daily fish processing capacity of 2,500 tonnes.

Meanwhile, in South-Central Chile it has a

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To Camanchaca, thank you for your trust in our products and services. Copec and Mobil.

More than a lubricant: A business tool If you think of oil as a line item, or simply as an operational cost, perhaps it’s time to think of it as something more: an opportunity. Mobil lubricants can smoothen the way to maximize productivity, reduce expenses and down time.

*Mobil is a trademark of Exxon Mobil Corporation or one of its subsidiaries. Other trademarks and product names used herein are the property of their respective owners.

Camanchaca fleet of eight offshore purseCOPEC seine fishing vessels with a Established in 1934, Copec has sold and distributed fuels total hold capacity of 10,000 for residential and industrial use in Chile. In 1959, Copec cubic metres, three boats for partnered with Exxon Mobil Corporation, one of the leading crustacean fishing, a canning lubricant companies in the world and owner of the Esso and plant with a daily production Mobil brands. It gave Copec the exclusive rights to produce capacity of 25,000 boxes, a Mobil lubricant products. This historical agreement has enabled Copec to consolidate the leadership of a market. fishmeal and fish oil plant, and Copec supports one of its most important customers, a Langostino processing plant.

Camanchaca, a leader in the fishing industry by supplying In Petrohué, the company’s high quality products and services. salmon hatchery boasts www.copec.cl an annual salmon smolt capacity of 15 million fish, making it the largest facility of its kind in the world. Elsewhere, Camanchaca’s Río del Este hatchery focuses on breeders in their last stage before spawning, while its Playa Maqui centre specialises in developing trout.

Together the Río de la Plata hatchery and the Playa Maqui centre produce an annual trout smolt capacity of five million fish.

“The vision of Camanchaca is based on the concept of feeding the world from the ocean,” explains Corporate Planning and Marketing Director, Igal Neiman, “therefore it makes sense that we have been focusing our activities towards meeting human consumption demands.”

“aquaculture products account for over half of Camanchaca’s revenues” be americas | 125

Between 80 and 90 percent of Camanchaca’s products are exported across the globe. “Approximately 90 percent of our salmon products are exported with our main markets being the US, Brazil, Japan and Mexico, while we are seeing increasingly high levels of demand coming from China and South East Asia,” Neiman continues.

“In the case of frozen mussels, Europe is our top market, although demand in the US

and Asia continues to rise. Frozen mackerel is mainly sold in Africa, while at home in Chile the growing aquaculture trade means there is a big demand for our fish meal and fish oil products.”

Being among the top tier of fishing and aquaculture companies in the world, it will come as no surprise to find that all of Camanchaca’s products come with the highest quality certifications. What you may not know

“The company was the first salmon producer on the planet to be awarded three star Best Aquaculture Practices (BAP) certification”

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Camanchaca

however is that the company people, local communities was the first salmon producer and the environment. on the planet to be awarded For starters the company three star Best Aquaculture employs around 3,000 people Practices (BAP) certification. during peak times, making The year Camanchaca Each star represents having it the largest employer in was founded a different part of one’s some of the localities in which it operates, providing value chain certified to the highest level. In the case of an economic lifeline to Camanchaca the three stars highlight the certain areas, from north to south farming of its salmon, the feeding of the of this long and narrow country. salmon and the work of its processing plant.

When it comes to sustainability Camanchaca Camanchaca’s understanding of the value has established three macro-programs dubbed of responsibility also extends beyond its own “Efficient Camanchaca”, “Clean Camanchaca” facilities with the company having taken and “Friendly Camanchaca”, which was great strides in its lifetime to support local set up last year. “As part of the Friendly

1965

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“In the last year the company has continued to make strong progress in expanding its international reach and securing its long term future�

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Camanchaca Camanchaca program we host numerous events designed to allow mutually beneficial interaction with local communities and stakeholder, understanding their concerns and needs,” Neiman says. “One of the other things we do is partner with local schools, inviting classes to visit our facilities where we teach them about our business in the hope that it encourages them to one day work for us or within the wider industry.

Meanwhile, when it comes to the environment we also bring together teams to work on cleaning local beaches and are constantly looking at ways to reduce energy and water consumption.”

In the last year the company has continued to make strong progress in expanding its international reach and securing its long term future. One development saw it opening an office in China, in partnership with three other Chilean companies, along with the brand “New World Currents”, in order to serve the South East Asian market and increase the distribution of salmon across the region.

Furthermore, last year saw Camanchaca become part of the Global Salmon Initiative, a select group of 15 salmon farmers from across the globe, representing 70 percent of the salmon produced worldwide, that are committed towards achieving sustainable growth for the industry.

“Our business expects a big growth in demand,” Neiman concludes. “As such, and bearing in mind the increase in demand for our products in Asia, it is important that we continue to make our production process as efficient as possible. In doing so we must maintain the sustainable growth of our industry. We recognise fully that you can’t take fish from the ocean without considering the renovation of this scarce resource, therefore as we grow as a business we will endeavour to ensure that we preserve the biomass of our oceans in the years and decades to come.”

For more information about Camanchaca visit: www.camanchaca.cl

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