BE.Monthly by Business Excellence Magazine

May 2014 | www.bus-ex.com

MONTHLY EDITION

How to find a purple squirrel Recruiting supreme innovators and ultimate game changers

Eurostar Diamond Traders

Luis MuĂąoz MarĂn International Airport

Metroselskabet/ Metro Copenhagen

ATLAS CARGO SYSTEMS LIMITED carries on

business as clearing, freight forwarding agents, transporters, haulers, packers, hirers, railway shipping and removal contractors or agents and brokers/proprietors of vehicles of all kinds howsoever propelled and aircraft of every description.

Linking the World by Road, Air, Sea & Rail

Email: administration@atlascargo.biz, operations@atlascargo.biz www.atlascargosystems.biz

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contents

10 cover story

How to find a purple squirrel Recruiting supreme innovators and ultimate game changers.

Operations

Why Excel is costing you millions

Why, by continuing to use static reports instead of a data discovery solution, companies arenâ&#x20AC;&#x2122;t able to see the larger trends.

[ may 2014 ] BE monthly

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Executive Insight

Danie Otto – Director, Digby Wells Environmental

Danie Otto discusses his biggest achievements, learning from past mistakes and who inspires him professionally.

Innovation

Intrapreneurship: Achieving sustainable competitive advantage

Smart companies develop and embrace intrapreneurship because they know that it can lead to business growth.

26 26

Strategy

Innovation to reach new markets and tap value pools

Innovation will create the foundation for many manufacturers’ future success - but innovative thinking is just the first step in creating an innovation portfolio.

Strategy

How the perception of corruption deters foreign companies in China – but shouldn’t

Rather than categorising a different business approach as malpractice, make an effort to understand China’s complex philosophy and culture.

BE monthly [ may 2014 ]

contents

Business of the month

38 Metroselskabet/Metro Copenhagen

Public transport to be proud of Metroselskabet holds the distinction of operating and expanding Metro Copenhagen, an ultra-modern, pioneering Metro system.

62 64

Transport & Logistics

Luis Muñoz Marín International Airport

Destination Puerto Rico Puerto Rico’s largest airport and on its way to becoming a gateway to the entire Caribbean region.

[ may 2014 ] BE monthly

Mediterranean Shipping Company

Shipping to and from South Africa Backed up its fleet of container vessels and multiple service divisions, MSC South Africa has been linking South Africa directly with the rest of the world since 1978.

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Starlite Aviation Group

116

A flight path to the future A proactive approach to growth has seen Starlite Aviation Group position itself perfectly for the years ahead. mining & minerals

100 Eurostar Diamond Traders

Hard rocks One of the world’s leading diamond wholesalers and diamond manufacturers, we spoke to its founder Kaushik Mehta.

116

108 De Beers Debswana

Strength in numbers As the Sierra Gorda Project enters an exciting new phase of its life, Senior Vice President of the project, Joseph Tis reflects on how the collective efforts and achievements of its workforce made 2013 such an important year.

Enriching a nation The world’s largest diamond producer by value, Debswana is Botswana’s largest private employer and arguably the biggest contributor to the country’s economic growth.

108

KGHM Polska Miedź Sierra Gorda Project

130

Barrick South America

The jewel in the crown Barrick had a significant investment programme for South America in 2013, much of which was targeted to advance the construction of Pascua-Lama, the world’s first bi-national mine, expected to be operational in the second half of 2014.

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contents

138

Copper Mountain Mining Corporation

A mountain of potential Harnessing the vast resources of the Copper Mountain mine in order to become Canada’s newest mid-tier copper producer.

150 Pyhäsalmi Mine Oy

Bringing ore to the surface The Pyhäsalmi mine is one of the deepest and oldest mines in Europe and has been producing vast amounts of copper and zinc for over 50 years.

158

IOS

Surfing the booms and busts of the mining industry Serving the Canadian mineral exploration industry since 1992, IOS integrates consulting services, contracting field work and operating a mineralogical laboratory.

[ may 2014 ] BE monthly

168

Rainstorm Dust Control

Taking the professional approach The last 18 months has been an exciting time for Rainstorm Dust Control and, as technical sales and marketing manager, Mason Trouchet explains, the next 18 could well be the best yet in the company’s 30 plus year history. energy

176

Staatsolie

Bringing value back home The national oil company of Suriname is facing a very promising future, with enough hydrocarbon reserves to keep it self sufficient for many years – at the same time it is investing in sustainable energy alternatives.

176

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Telecoms

212

186 186

194

CONCIEL

Tailor made success Managing Director, Michel Maalouf discusses how a passion for creativity and a drive to deliver results have contributed to the success of CONCIEL.

220 Neotel

Providing coverage and connectivity Neotel has risen to the point where it stands among the top-tier telecommunications businesses on the African continent.

EcoElectrica

Power for the future EcoElectrica has established itself as one of the Caribbean’s lowest cost producers and a vital contributor to Puerto Rico’s growing energy mix.

LUCELEC

Powering an island nation Saint Lucia Electricity Services Limited (LUCELEC) was established in 1964, which means that this year it is celebrating its 50th anniversary. manufacturing

204 PI Industries

Agriculture inspired by science PI Industries holds a unique position in the Indian agrochemical industry, as reflected in its healthy growth, supporting an ambitious programme of expansion in both the domestic and export markets.

healthcare

228

Ascendis Health

Your health in good hands Chief Executive Officer Dr Karsten Wellner discusses the philosophy and values behind Ascendis Health, the home of some of South Africa’s leading health and care brands.

228

BE monthly [ may 2014 ]

How to find a purple squirrel Recruiting supreme innovators and ultimate game changers Words by

[ May 2014 ] BE Monthly

David Dumeresque

ix years ago Jan Koum and Brian Acton applied for jobs at Facebook. Both were turned down and Acton would often quip: “We’re part of the Facebook reject club. Today, Ukrainian-born Koum is a good friend of Facebook’s Chairman and CEO, Mark Zuckerberg. He has also joined Facebook’s Board of Directors, but not before Zuckerberg paid him and Acton $19 billion for their company WhatsApp. How the HR people at Facebook must be kicking themselves. If only they had the foresight to employ Koum and Acton when the two applied for positions at the company. They could have saved Facebook a huge amount of money. Or perhaps looking at it another way, they could have made Facebook a huge amount of money! Hindsight is always 20:20 vision and the recruitment industry abounds with not dissimilar stories. Certainly Facebook’s HR team was not to know the eventual outcome regarding Koum and Acton, nor indeed is there any certainty that they would have invented WhatsApp if employed by Facebook. However, there are numerous cases where recruitment is undertaken without a thorough understanding of the drivers behind the role to be filled or the personal attributes required to achieve success in that role. What often happens is that the hiring manager will pass onto the HR Department a job description based on what the previous person had been doing during his or her tenure without thinking

about how things might have changed over that period, briefly discuss the position with the HR team and then wait for the short-list of suitable candidates to materialise. HR will rarely challenge the actual skill sets being sought. Another issue with which we as search consultants are increasingly being confronted is a brief to find a target who we colloquially term a “purple squirrel”. These are the rarest of individuals; extremely talented, supreme innovators and the ultimate game changers who are ‘perfect’ in every way - education, competencies and experience. Whilst they do exist, the reality is that purple squirrels won’t be found using conventional recruitment parameters and the process requires the consultant to have an in-depth knowledge of the client, and the client to trust the consultant’s intuition. Take Jan Koum, James Dyson and Steve Jobs as examples. Highly talented, supreme innovators and the game changers every senior executive would want to have on his or her team. However, prior to achieving the level of success they have become renowned for, all three would have failed the conventional recruitment approach because none of them possessed a university degree. Purple squirrels can be likened to great actors. They are team players operating best with others around them but they often excel

“Hindsight is always 20:20 vision and the recruitment industry abounds with not dissimilar stories”

[ May 2014 ] BE Monthly

recruitment

“why do companies seek to hire a purple squirrel if the process can be so challenging?”

in roles on their own. These people know what they want and where they want to be. For companies looking to recruit them, it is essential that they understand the job acceptance criteria of these purple squirrels. This will often entail having the right amount of leeway to undertake their role. The normal management strictures will be a complete turnoff for them. Indeed, most of the time they won’t want to have much to do with management but prefer to be given a free rein. Certaily, the idea on managing people will not be high on their list of priorities as this can restrain their freedom to think. Furthermore, just a lucrative financial package and the opportunity for career development are never deal clinchers. More often than not, this requires a change in recruitment approach. Rather than the hiring manager concentrating on competency-based recruitment (which certainly plays a part in the general recruitment process but doesn’t work with purple squirrels) the approach needs to be aspirational-based. What should be going through the mind of the recruiting manager is: “What sort of candidate will produce outstanding results for the organisation?” rather than: “Can the candidate do the job?” This makes the recruitment process a driver, rather than an inhibitor, of management innovation. This is really important because unless there is some degree of innovation in the recruitment process, purple squirrels will quickly deduce that the company is lacking in innovation and walk away. Equally important from the hiring managers pointof-view is to make sure that everyone who

BE Monthly [ May 2014 ]

is associated with the recruitment – or who will be affected by the hire of the purple squirrel – has bought into the idea. But why do companies seek to hire a purple squirrel if the process can be so challenging? There are many reasons, not the least of which is the economic impact these people can have on the organisation. Tony Fadell, Philips’ former head of digital audio strategy, was a perspicacious hire by Apple executives. Whilst at Philips, he conceived the concept of the MP3, but took his fledgling technology with him to Apple

and went on to become known as one of the fathers of the iPod, making billions for company in the process. It has also been said that Google is one company that actively chases purple squirrels because they have calculated that recruiting a top technologist will result in around 300 times more productivity and business impact than an average technologist. In financial terms, if (as suggested) the average Google employee generates around $US1 million in revenue each year, hiring a single purple squirrel technologist has the potential to add $US300 million to Google’s revenue annually. Then there is the brand impact hiring a purple squirrel can have on the organisation. When it was announced

“hiring a single purple squirrel technologist has the potential to add $US300 million to Google’s revenue annually”

[ May 2014 ] BE Monthly

recruitment

“Even though they are rare individuals, identifying purple squirrels is not difficult because their achievements and reputation will have been well-documented”

in October 2013 that Burberry’s Chief Executive Angela Ahrendts was leaving the fashion and luxury goods firm to join Apple as Senior VP for retail and online stores, word rapidly spread through all forms of media, thereby boosting still further Apple’s “street cred” – especially useful at a time when people were questioning Apple’s strategy. Additionally, employing a purple squirrel can often attract other top talent. Perhaps it was pure coincidence, but a couple of months before the announcement that Ahrendts was joining Apple, the technology giant had hired Paul Deneve, Yves-Saint Laurent’s former CEO and President, and Enrique Atlenza, a senior vice president at Levi’s. In recruitment we often talk about the need to ensure candidates are a good cultural fit and have skills that complement existing staff. However, in recruiting purple squirrels this often means flipping existing recruitment models on their heads. Certainly we would not identify targets we know to be the diametrical opposite to a firm’s existing culture, but given that these people are pioneers who are capable of disrupting an organisation in a very positive way, there are times when some exceptions have to be made. It may also mean making internal changes to the way in which the organisation operates and driving those changes forward. There are many examples of companies that have successfully done just that. Even though they are rare individuals, identifying purple squirrels is not difficult

because their achievements and reputation will have been well-documented. The difficulty comes in convincing them to change tack. Some will have giant-sized egos that need to be massaged expertly, and hiring managers must be prepared to accept more than a little arrogance. Furthermore, they will not discuss any potential job offer, irrespective of how lucrative it may be, with someone they don’t have a relationship with. This may often entail using business networks to build relationships with potential targets long before any approach is made regarding career change. For companies prepared to put in the groundwork, be adaptable and be seen to be innovative, irrespective of the industry sector, the effort will be well rewarded.

About the author

David Dumeresque David recruits senior executives and board directors for Information, Communications and Entertainment organisations across publishing, broadcast, digital media, as well as leading the firm’s Professional Services practice and acting on behalf of more general consumer products companies. He also has advised a wide spectrum of professional services firm on senior lateral hires, including lawyers, accountants, consultants and real estate professionals. www.tyzackpartners.com

BE Monthly [ May 2014 ]

Why Excel is costing you millions Why, by continuing to use static reports instead of a data discovery solution, companies arenâ&#x20AC;&#x2122;t able to see the larger trends Words by

[ May 2014 ] BE Monthly

Gayle Ryan

few years ago, the ability to capture and manipulate data was an exciting possibility. Organizations often pulled information from databases, which they would then export into Excel to manipulate and analyze. Today, however, static reporting is no longer enough. Recently there has been a shift in Information Technology from traditional Business Intelligence (BI), where reports are static, to data discovery, where the reports are focused on users, and are dynamic and easy to use. Organizations now need to be able to explore their information and visualize the data in order to stay competitive. Organizations have more data than ever before, and companies that have developed a way to harness and explore their data have an advantage in the market. Excel has its place for certain functions, but spreadsheets don’t allow decision makers to see the big picture as effectively as a dashboard. In fact, even Microsoft has noticed the shift away from static reporting and realized that Excel isn’t enough, which is why there are more data discovery capabilities in newer versions of Excel and in Microsoft Power View. Still, even the added capabilities in Microsoft Power View still do not allow users to fully monitor, analyze, and explore their data. In order to remain agile and recognize opportunities, organizations need to invest in BI tools that include data discovery and dashboards. Gartner predicts that more and more devices will be connected with the internet, calling it the “Internet of Everything”. Gartner

“spreadsheets don’t allow decision makers to see the big picture as effectively as a dashboard”

[ May 2014 ] BE Monthly

named this one of the top 10 strategic technology trends for 2014, predicting that this trend will drive an enormous increase in information available. With this massive expansion in available information, the potential for exploration and analysis also grows, requiring the need for more sophisticated and proactive information management and analytical models. Is Excel up to the task? Excel reports are static, and take time to produce. By the time the decision makers receive their report, the information is already out of date. With a real-time dashboard, people receive updates as soon as the information is available. Dashboards are also interactive, unlike Excel, which means that if a certain data point is troubling, dashboard users can drill down to get more information. Dashboards even provide alerts and updates when something is amiss. Excel spreadsheets do not provide alerts or updates, and, they are actually hindering our ability to understand critical information by being difficult to read. Finally, Excel spreadsheets are prone to error. One typo can skew all of the data, and it may take time to notice and correct the mistake. Data discovery tools are automated, and much of the room for human error is eliminated. With more and more information available through a growing number of devices connected to the internet, there are more opportunities for companies to develop new business models, products, marketing strategies, and engagement models for customers, employees, and partners. However, this will only be possible for the organizations that are able to use their information quickly and effectively. Excel spreadsheets are not a reliable way to manage BI, reporting, and data discovery in order to compete in the quickly changing market. Companies need a comprehensive solution, including BI infrastructure, data discovery tools, dashboards, and effective

operations

data visualizations that will allow them to analyze and explore large sets of data. Gartner makes the bold statement that “No business can afford to ignore or underplay the impact of technology-driven disruptions that are even transforming what it means to be a business in a digital world.” Traditional BI is no longer enough; data discovery is now necessary to remain competitive. Comprehensive BI solutions that include data discovery and dashboards, however, can require a large investment of both time and money. Depending on the organization’s requirements and existing IT infrastructure, investments in servers, storage, clients, and networking may be necessary. Implementation, training, and administration also add to the upfront costs. It is possible, however, to reduce the capital expenditure needed for deployment with cloud services. In addition to the up-front costs, BI tools will incur maintenance costs and costs associated with enhancing and extending the application. These costs usually far outweigh the up-front investment. In fact, Gartner estimates that, for a business application that is used for 15 years, the average cost to go live is 8% of the total lifetime cost of ownership. It is important to note that the Total Cost of Ownership (TCO) is highly dependent on design decisions, and so it is important for organizations to design the BI solution according to their needs from the beginning, as this will affect, and could drastically reduce, the maintenance and enhancing costs. However, a BI solution will actually reduce operational costs. Manual reporting can be almost eliminated or greatly reduced with a comprehensive BI and dashboard solution. Each organization’s reporting needs and subsequent savings will vary; however, organizations that assign one analyst to each team can likely reduce the number of analysts to one or just a few for the

“Traditional BI is no longer enough; data discovery is now necessary to remain competitive”

entire organization. Neo@Ogilvy, a Dundas Data Visualization customer, used Excel to analyze and report on its customers’ data. After implementing a BI solution, including a Dundas powered dashboard, the organization saw their reporting time decrease by 90%. There is mounting research that indicates organizations need a BI solution that includes data discovery, dashboards, and data visualization tools in order to use the ever-increasing amount of data available and remain competitive in the market. With this evidence, the question is, can you afford not to invest in BI? The opportunity costs of avoiding a BI solution and continuing to use Excel for reporting and data exploration will soon become apparent, if they aren’t already. By continuing to use traditional BI tools including static Excel reports instead of a data discovery solution, companies aren’t able to aggregate all of their data and see the larger trends. Managers and executives aren’t able to understand their data easily and make fact-based decisions quickly. Organizations aren’t able to harness and use data, an element that has, and will continue to disrupt the way businesses run. About the author

Gayle Ryan Dundas Data Visualization. www.dundas.com

BE Monthly [ May 2014 ]

Danie Otto Director, Digby Wells Environmental

Executive insight

Nobody’s perfect. What quality or ability do you wish you had?

Who or what do you think is overrated?

“Being able to predict the future more accurately.”

“The Prius hybrid car. Many other vehicles give better fuel consumption at efficiencies and power ratios significantly better than this car.”

What is the best business book you have ever read, and why? “Mind of a Fox, by Clem Sunter and Chantell Illbury. Through scenario planning they predicted the 9/11 disaster. The book talks about enabling one to have vision to the point where one can predict specific future events.”

Someone you would most like to have met, living or dead, and why? “Sir Richard Branson, in order to to learn from his entrepreneurial skill and ability. Also to learn from and discuss his vision to expand the Kruger National Park through ecological rehabilitation at his nature reserve, Ulusaba.”

What do you consider to be your major achievement (in life or business)? “Being able to assist with major environmental projects as mediator for the environment for 20 years, without being in the spotlight. It’s like a soccer or rugby match, the game is not about the referee. If people talk about the game and not the referee, he has done his job well.”

What mistakes have you made (professional or otherwise), and what did you learn from them? “The opening and closing of various regional offices, from which I have learned to better read the market, keep overheads low, and stay flexible and mobile.”

Which one piece of wisdom would you pass on to your successor? “To mentor and train people not to take over from you but to overtake you.”

Who has been your inspiration professionally? “Dr Niels Jacobson, the retired parks board ecologist who I have had, and still have, the opportunity to work with and learn from. His immense knowledge and hunger to learn that never diminishes even after retirement, together with thorough systematic and scientific methods, has been a constant source of inspiration.”

How would you like to be remembered after your retirement? “As a mentor, not only on a professional level promoting biogeomorphology and ecological restoration, but on a life skills level as well.”

Do you have a quote or motto you live (or work) by? “My motto is to work hard, play hard and follow your passion.”

Learn more about Digby Wells Environmental www.digbywells.com

BE Monthly [ May 2014 ]

[ May 2014 ] BE Monthly

Intrapreneurship: Achieving sustainable competitive advantage Smart companies develop and embrace intrapreneurship because they know that it can lead to business growth and provide the means to achieve sustainable competitive advantage Words by

Mike Sotirakos

BE Monthly [ May 2014 ]

hat is intrapreneurship? Zahra, (Journal of Business Venturing, 1991), defined intrapreneurship as the process of creating new business within established firms to improve organisational profitability and enhance a company’s competitive position or the strategic renewal of existing business. Employees are usually given the opportunity to work on projects where they can use their entrepreneurial skills to develop new products or services that become profitable ventures for the company. Unlike entrepreneurs, however, they don’t incur the risks associated with these projects, but neither do they gain the huge financial rewards if their new product or service is a blockbuster. One question that is often put to me is; “Isn’t an entrepreneur and an intrapreneur one and the same?” There are certainly some similarities although the former usually relates to the creation of a new venture externally, outside an existing organisation. Indeed, many successful businesses started life as entrepreneurial start-ups that later became mature organisations. The last 100 years have seen significant levels of innovation, yet the demand for greater levels in business has never been more intense than it is today. There are many reasons why, not the least of which are maturing industries and products, increased levels of competition, changing consumer needs, political and environmental pressures

“the demand for greater levels of innovation in business has never been more intense than it is today”

[ May 2014 ] BE Monthly

and a rapidly changing global marketplace. However, in many organisations innovation has become something of a paradox. Everyone knows that it’s probably essential for survival but it can be regarded as time-consuming and expensive, it diverts the company away from its core business and comes with a strong downside of failure. It seems more important to remain rigidly blinkered but still moving forward – irrespective of how slow – rather than adopting a more open view and adjusting tack to take advantage of better conditions that are likely to prevail in the future. There is also a belief that corporate intrapreneurial activity has a higher failure rate than that of external entrepreneurs. But what is the evidence that intrapreneurial startups are less successful? It has been suggested that corporate venturing is less successful because insufficient time, commitment and money are invested in innovative activities. Furthermore, because intrapreneurs operate within the structural and procedural constraints of an established organisation, they lack the innovative freedom that the entrepreneur enjoys. What entrepreneurs don’t benefit from is the financial, administrative and operational support that is provided to intrapreneurs. However, much of the evidence is empirical and, given the large number of variables and basic lack of available data, unreliable. Nevertheless, where deeply entrenched beliefs and practices – many of which run counter to innovation and creativity – exist within the organisation’s culture, then corporate venturing is unlikely to get off the ground. Doing nothing is often a bigger risk than doing something that could potentially be beneficial, and intrapreneurship is as much about change management as it is about innovation. If business leaders are willing to

innovation

repudiate outdated notions and unworkable management practices, possibly forego short-term gains, accept (and factor in) that failure could potentially be an outcome, and openly demonstrate a higher degree of trust, confidence and respect in their workforce, job satisfaction will increase substantially and prosperity for all will follow. You only need to look at companies such as Panasonic, Toyota, 3M, Facebook, Google and many others to see the evidence of this. Even though there are some similarities between intrapreneurial and entrepreneurial behaviour, there are some importance differences that business leaders need to be aware of. One very notable difference is that entrepreneurs are more self-centered than intrapreneurs, they are willing to take much greater risks, and the significant “adrenalin high” they get when working on specific projects plays a key role in their motivation. This is not to say that intrapreneurs are risk averse, but key motivators need to be carefully aligned for these internal innovators. Financial rewards such as success bonuses are important, but often more important to them is peer recognition and being placed in the corporate limelight. Whilst entrepreneurs operate within a structure that has few boundaries, intrapreneurs live in an environment of constraints, brought about largely through corporate policies and management practices. For intrapreneurship to succeed, management must ensure that innovation is woven into the very fabric of their organisation and given a prominent place in job descriptions, procedures and performance evaluations. Intrapreneurs need some degree of autonomy but have very clear guidelines within which they can operate. Effective managers are those who know when to pull on the reins without creating disillusionment, and when to let them go to maintain optimism.

“Intrapreneurs need some degree of autonomy but have very clear guidelines within which they can operate”

Established companies have the advantage of an existing resources base – such as design, marketing, sales and finance – that entrepreneurs don’t have. However, if they remain scarce or intrapreneurs have to fight their corner every time they require these resources, innovative projects will never get beyond the drawing board. Once the decision is made to run with a specific project, management must ensure that the resources required to achieve a successful outcome are made fully available. The digital era is beginning to provide enormous opportunities for companies to reap the benefits of innovation and creativity. Explosive wealth creation will only materialise, however, once business leaders have understood how to identify, nurture and manage the intrapreneurial spirit within their organisations.

About the author

Michail Sotirakos After 11 years in academia he branched out into business and has successfully launched a number of companies. He is the CEO of Watershed Entrepreneurs and, as a business modeling expert, also works with companies in the development of their intrapreneurial programmes. www.watershedentrepreneurs.co.uk

BE Monthly [ May 2014 ]

to reach ne and tap va

Innovation will create the found future success - but innovative t creating an inno Words by

[ May 2014 ] BE Monthly

George

ew markets alue pools

dation for many manufacturersâ&#x20AC;&#x2122; thinking is just the first step in ovation portfolio F. Brown, Jr.

BE Monthly [ May 2014 ]

t is almost impossible to avoid the messages about the importance of innovation that dominate business magazines, web sites, and conferences. At a most recent Annual Meeting of the Institute for the Study of Business Markets, innovation joined “Big Data” and channel disruption as the three themes cited by CEOs, CMOs, and academic experts as most critical to the future success of business-to-business manufacturing firms. That emphasis is nothing new. Peter Drucker said “Innovation is the specific instrument of entrepreneurship, the act that endows resources with a new capacity to create wealth.” Michael Porter similarly observed that “Innovation is the central issue in economic prosperity.” And Steve Jobs believed that “Innovation distinguishes between a leader and a follower.” I agree with the emphasis on innovation as central to the future growth and profitability of our companies. There are far too many success stories rooted in innovation to credibly argue otherwise, and, unfortunately, far too many stories of firms that deteriorated from great to second rate by failing to keep pace with innovative competitors. But, at the same time, I believe our firms far too often have tunnel vision with respect to the ways in which they think about innovation. An example supports that conclusion. Over a breakfast meeting recently with a number of business executives, I asked for their favorite example of an innovation success story, one drawn either from their

“I agree with the emphasis on innovation as central to the future growth and profitability of our companies”

[ May 2014 ] BE Monthly

own experience or from other firms with which they were familiar. Each individual easily offered an example, and in every case, described a situation in which success was achieved by raising the bar – identifying a way to enhance products with new features, improved performance, superior design, or along some other dimension. A few involved success stories familiar to many of us, but most reflected something that was known mostly by participants in the industry in question. There was no question that all of these examples were in fact innovation success stories, ones that any firm would have been proud to claim. In fact, innovations that “raise the bar” are those that we most frequently celebrate, those that we invest scarce technical resources and R&D dollars to achieve. And should there be any question, there are good reasons for investing in raising the bar. A number of years ago, I worked with a client to estimate the relative shares of the “Good”, “Better”, and “Best” segments of their market. With some modest rounding, we found that the split was about 40%, 30%, and 30%. While acknowledging that all generalizations are false, that rule of thumb has been remarkable in terms of being a good approximation in other markets that I’ve studied since then. The finding is also good news in terms of “raise the bar” innovations – 60% of customers are looking for, and willing to pay for, products that go beyond the bare bones “Good” offering. And it is in fact the firms that raise the bar most successfully that are likely to win the customers in the “Best” segment, the customers most likely to pay a price premium for those features and attributes that distinguish each generation of “Best”. Those firms that can raise the bar should raise the bar. They are likely to be rewarded for doing so. But raising the bar is not the only option for innovation strategies. There are two

strategy

very different innovation strategies that should be considered, ones that have the potential for creating value that can be captured. And, like raising the bar, they are demanding in terms of creativity and out-of-the-box thinking. In my experience, western firms are far less likely to assign resources to innovations that fall into these two categories, preferring to focus their attention on opportunities to raise the bar. My perspective on the first of these opportunities for innovation was recently motivated by the work I have done along with my colleague David Hartman on the changing competitive environment. In a series of articles, we have argued that the future competitive landscape will be changed in fundamental ways by firms from emerging markets like China that have learned how to produce “almost-as-good products at a great price point”. What these firms have done is dramatically expand their markets, reaching the large middle markets of countries like China and India with innovative products that retained the key features of the highend “Best” offerings from the west, at a price point affordable to the much larger middle market segments of their home countries. These firms have found innovative ways to preserve the key product features critical to customer acceptance while at the same time identifying economies that allow them to reach a much lower price point. Often their innovations involve strategies to remove costly features that are not critical to the customers in their targeted markets. In other instances, their innovations involve creative approaches to

manufacturing, sourcing, service, and other elements of their cost base. For those that aren’t yet studying the success stories of emerging market firms like Huawei, Mindray, Sany, Haier, and others that have innovated through this “expand the market” strategy, I point to the much more familiar success story of Henry Ford, another creative executive that figured out the “almost-as-good product at a great price point” formula. In his autobiography, Ford wrote: “I will build a car for the great multitude. It will be large enough for the family, but small enough for the individual to run and care for. It will be constructed of the best materials, by the best men to be hired, after the simplest designs that modern engineering can devise. But it will be so low in price that no man making a good salary will be unable to own one.” His vision required many innovative concepts, not the least of which was the assembly line, but it not only created value for his company, but in fact a whole industry, by expanding the market. This approach to innovation is particularly important today. Many of the same firms that tout innovation as key to their future cite the middle markets of emerging countries as their growth markets of the future. Success in those segments will only come from the firms that figure out the strategy of creating “almost-as-good products at a great price point”. Without attention and focus on innovations that “expand the market”, it is a good bet that it will be firms from countries like China that are the eventual winners in those huge markets of the future. Today, firms from those countries are probably as far ahead along

BE Monthly [ May 2014 ]

this dimension of innovation as western firms are in terms of innovations that raise the bar. Unless success can be achieved in the increasingly squeezed “Best” segments, investments that can yield success stories in the “Better” and “Good” market segments must be part of the innovation portfolio of western manufacturing companies. Almost every business firm with which I work puts considerable importance on strategies that enable them to reach new markets. And, as mentioned above, today, the broad middle markets of the emerging economies are high on the list of targets that have scale and growth potential. But it is rare that I hear innovation linked to the discussion of strategies through which these markets can be reached. And in fact too often I hear executives sadly dismiss the potential of serving these markets, making statements like “at the price points that exist in that market, we could never hope to make any money”. Innovation is potentially the answer to that problem. Finding creative ways to take costs out while retaining the critical features of products is a possibility, one that can yield major dividends in terms of growth in new markets. There is a third innovation strategy that can yield dividends in some markets. Many manufacturers sell through complex customer chains. Ingredient and component suppliers sell to OEMs and other manufacturers that incorporate their ingredients and components

[ May 2014 ] BE Monthly

into their own products, eventually reaching end customers. Other manufacturers sell to distributors who sell to contractors, installers, and VARs who themselves serve end customers. In many of these situations, the end customers involved are price buyers, giving considerable weight to price in their purchase decisions. The suppliers in such situations frequently report an inability to gain traction from traditional “raise the bar” innovations, as the intermediaries between them and the end customer are unwilling to agree to improvements that carry with them a higher price tag. In numerous instances, I have heard the frustration of suppliers involved in such markets, as their innovations are met with a cold shoulder by their direct customer. What has been far more successful in many of these situations have been innovations that “change the game”, that create value by creative approaches to profitably transform the economic and business relationship between the supplier and their direct customer. The opportunity to “change the game” in this way builds upon the fact that there are significant adjacency costs associated with most products that are sold through the types of complex customer chains described above. Some of those adjacency costs involve the manufacturing process, others are more subtle like those associated with warranty costs. But adjacency costs are always there, and are frequently much larger than the product costs per se. I have seen many instances in which the adjacency costs linked to a product are an order of magnitude larger than the product cost itself. Working recently with a manufacturing firm that supplied an important component to its business customers, we went through a systematic process to identify and quantify these adjacency costs. A few of their strategic accounts provided on-site access to allow the teams working on this initiative to identify

strategy

all of the cost elements that were linked to the use of this firm’s component. The results were shocking to all involved, as it turned out that the “value pool” that emerged from this work was many multiples of the cost of the component itself. As one executive noted, “we’ve not created the opportunity for value creation and capture that goes dramatically beyond the price of our product”. It is such value pools that create the opportunity for innovations that “change the game”, ones that take costs out of the system through creative approaches to product design, through changes in the roles and the boundaries between suppliers and customers, and through other strategies that enable value creation and capture. Such innovations respect the reality of the price pressures of end customers, and enable margin improvements centered in the business processes within and between the manufacturing partners at earlier stages of the customer chain. In interviews with OEMs and other manufacturers, many of the success stories that they tell about their favorite suppliers involve innovations that “change the game”. In some markets, those are in fact about the only opportunities for innovation that are available to suppliers. There is no question that innovation will create the foundation for future success

“Almost every business firm with which I work puts considerable importance on strategies that enable them to reach new markets”

stories for many manufacturing firms. The focus on innovation correctly belongs high on the agenda. But innovative thinking about innovation is the first step in the process. The three flavors of innovation described here – ones that can raise the bar, ones that can expand the market, and ones that change the game by tapping into available value pools – all have the potential to be the foundations of those future success stories. Thinking through your firm’s opportunities within each of these categories, in the context of the markets targeted, the customers along the customer chain, and the competitors against whom you must win can allow the creation of an innovation portfolio that draws appropriately on all three possibilities and allocates resources to those opportunities most likely to yield future success.

About the author

George F. Brown, Jr George 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

BE Monthly [ May 2014 ]

How the p of corrupt foreign comp but sho

Rather than categorising a as malpractice, make an e complex, diverse ph Words by

[ May 2014 ] BE Monthly

David

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orruption exists in all societies, not least in the financial markets of the West. In China, patronage systems and collectivism have inevitably encouraged corruption in one form or another, which has flourished according to the relative strength or weakness of the rule of law. However, some Western businesses (including those from the UK) have worked out that ethical problems in doing business in China or perceptions of such are often traceable to misunderstandings and lack of cultural awareness. A careful study of Chinese culture should precede all business forays into China. A lie is not always frowned upon in Chinese culture. The Chinese will accept a ‘white lie’, especially when respect or face is involved. This concept can be a little difficult for Westerners to understand but they shouldn’t be too ready to criticise. Often a white lie is used to either avoid embarrassing or damaging someone, saying something that they think will disrespect you, or saying something they think will undermine your authority. It’s best not become aggressive because of this, but rather to be grateful for this form of respect. The most successful foreign companies in China have practised solving these kinds of problem with discretion and diplomacy. The concept of ‘guanxi’ (connections, network) and the obligations it carries are a major feature of

the Chinese business world, but personal friendship can be stronger than guanxi. Sometimes various obligations will collide, and a Chinese person will spend considerable time working out a solution that gives respect to all parties, often avoiding the literal truth in the process. SHADES OF GREY When doing high-level business in China a smart business person should learn to recognise such shades of grey and develop strategies accordingly, as Chinese people are inherently skilled at seeking out the solution to the problem. Although legal protection has generally been weak, one of the most effective anticorruption factors for private sector firms in China is the sharing of prospective high profits. This prospect aligns the interests of government officials with those of entrepreneurs and investors, thereby ensuring that all parties fulfill their roles and protect the firm’s reputation to make the enterprise successful. Generally speaking, Asian executives rate corruption well below inflation and inadequate infrastructure or labour regulations as an obstacle to doing business. In part this is because Western law has not been central to Asian experience except in cities like Hong Kong and Singapore that were under colonial rule for a long time. China, by contrast is said not to have rule of law but rule

“A lie is not always frowned upon in Chinese culture. The Chinese will accept a ‘white lie’, especially when respect or face is involved”

[ May 2014 ] BE Monthly

strategy

â&#x20AC;&#x153;dishonest players will Often be flushed out when asked to sign a contract, even if the contract is merely a negotiating ploy on the route to a long-term relationshipâ&#x20AC;?

by law. A successful entrepreneur or a government official will command a large project to be done and it will be done. His power may be theoretically limited by the need for permits, but he will order his lawyers to find a law that allows what he wants, or he will even get a new law passed. Anyone who wants to do business in China should be aware of the variety of legal systems in operation, and of their relative strengths and weaknesses. In such a huge economy, people are always wary of new, unknown customers. Building trust and an inclusive relationship will involve time and often some financial investment as well. When mutual trust deepens, so also can a sense of mutual openness and fairness. But for every barrel of apples there are usually a couple of bad ones so if a foreign company encounters consistent problems with ethics, it should change companies or partners. ACT CAREFULLY AND SENSIBILY Acting carefully and sensibly in the Chinese market (s) pays dividends. Designs should be registered in China and the source company should be informed that this has been done. Sensible contracts should be designed that carefully protect intellectual property. The parameters of a copy in the contract should be specified to avoid later arguments and litigation. Often dishonest players will be flushed out when asked to sign a contract, even if the contract is merely a negotiating ploy

on the route to a long-term relationship. Whether hiring staff, investing in a joint venture or appointing a local distributor, carrying out due diligence is indispensable when launching a business in and with China for the first time. The key objective of due diligence is to verify the trustworthiness of partners and employees before proceeding with any significant investment. Nowadays there are numerous legal and risk assessment specialists with offices in China that provide business intelligence, background checks and risk assessment consultancy. However, no amount of due diligence will protect a foreign investor from a collapse in business relations. It is vital that any market entry with Chinese partners at home and abroad is based on trust above all. Every effort must be made to ensure that a strategic partner is trusted.

About the author

David Clive Price With 25 yearsâ&#x20AC;&#x2122; experience of Asia business, David Clive Price helps Western companies, SMEs and entrepreneurs to launch and expand in Asian markets. His bestselling Master Key Series offers proven strategies for building profitable partnerships and gaining competitive advantage in Asia. www.davidcliveprice.com

BE Monthly [ May 2014 ]

Metroselskabet/M

Public transport

Metroselskabet holds the distinction of operating an pioneering Metro system that has contributed c words by

[ May 2014 ] BE Monthly

Will Daynes

ď ľ research

Metro Copenhagen

t to be proud of

nd expanding Metro Copenhagen, an ultra-modern, considerably to the cityâ&#x20AC;&#x2122;s growth in recent years

research by

David Brogan BEBE Monthly Weekly [[May Issue 2014 83 ]

ounded in the 10th Century, Copenhagen became the capital of Denmark in the early 15th Century and is today the country’s most populous city, with figures as of October 2013 recording it having an urban population of over 1.23 million and a metropolitan population of 1.97 million. The cultural, economic and governmental centre of Denmark, the city has played host to considerable urban and cultural development in the last several decades which has been facilitated by investment in its institutions and infrastructure. The investment in Copenhagen’s infrastructure has seen its transportation network become a hub within Northern Europe, a network which includes road, rail, an international airport and the Copenhagen Metro. The origins of Metro Copenhagen date back to the early 1990s when plans for its construction first started to be considered. It was in 1997 that an agreement on an overall master plan was signed, with an international tender process leading to ground being broken that same tear. Five years on the first phase was opened to revenue service, with extensions being unveiled in the years that followed. Today the Metro boasts 22 stations situated over 21 kilometres of line, upon which a fleet of 34 vehicles operate.

“Today the Metro boasts 22 stations situated over 21 kilometres of line, upon which a fleet of 34 vehicles operate”

[ May 2014 ] BE Monthly

Henrik Plougmann Olsen, Chief Executive Officer of Metroselskabet

Metroselskabet/Metro Copenhagen

BEBE Monthly Weekly [[May Issue 2014 83 ]

Global Transport and Logistics

We tailor solutions to meet your requirements for transport of heavy lift and project cargoes. Our ability to plan and execute transports globally as well as handle project transport documentation enables us to move heavy and/or out of gauge cargo from one point to another. And from multiple points to your turnkey job site.

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Metroselskabet/Metro Copenhagen

“The establishment of Metro Copenhagen bore immediate success and helped usher in a new era of public transportation in the city”

“The establishment of Metro Copenhagen bore immediate success and helped usher in a new era of public transportation in the city. It has since gone on to contribute towards the growth of Copenhagen, which in turn has resulted in plans to expand the Metro system itself across the city,” states Henrik Plougmann Olsen, Chief Executive Officer of Metroselskabet, the company owned by the Ministry of Transport and Copenhagen and Frederiksberg municipalities, which

By the end of 2014 all box constructions and shafts will be complete

DSV Air & sea DSV Projects – Carrier of tunnel segments to Copenhagen Metro Project DSV Projects we re in 2012 awarded the Transport Contract covering deliveries of approx. 21,000 concrete rings for the construction of the “Cityringen Metro Project” in Copenhagen. The concrete rings are produced in Germany and transported to Copenhagen on Roll trailers - 3 rings are loaded on each trailer. For this purpose, DSV provides a Ro-Ro vessel through DFDS who performs 4 sailings every 5 weeks. Each departure will carry approximately 162 rings. Each stack of rings are under ocean voyage lashed and secured with 4 loop lashings,3 top over lashings and 3 Olympic Lashings. Furthermore, frictions mats are placed under the intermediate wooden beams, which are placed between each segment.

Prior to arrival in Copenhagen, CMT has instructed DSV whether the rings are to be delivered directly to the building site or to be unloaded on a dedicated storage area rented by DSV within the Copenhagen port. DSV has, for the project, dedicated six trailers to be used for delivery of the rings to the 3 TBM worksites (Nørrebroparken, Tømmergraven & Øster Søgade). For the safe stowage on the vehicles, each trailer has been equipped with two sets of special designed wooden cradles fixed to the deck of each trailer. The 3 Olympic Lashings will remain on each stack until final delivery to the worksite. Each truck is shunting from the port to the TBM worksites every day delivering between 10-12 rings per working day. www.dsv.com

BEBE Monthly Weekly [[May Issue 2014 83 ]

SikA WATerPrOOFing SySTeMS SIKA DANMARK A/S delivers flexible Waterproofing Systems to the Metro Cityring in Copenhagen: • • • •

Waterstop Systems - Sika®Waterbars, Sika®Swell, SikaFuko® High flexible TPO membranes (FPO) to guarantee close fit to the surface profile and to improve the workability Mortars Shotcrete Accelerator

SIKA DANMARK A/S +45 48 18 85 85 sika@dk.sika.com www.sika.dk

Metroselskabet/Metro Copenhagen

SIKA Waterproofing systems below ground structures are faced with more stringent requirements regarding durability, exposure and stress conditions, construction method and sequence, ease of application and total cost management. In addition, sustainable system solutions are becoming more important in order to save natural resources, energy and water, plus reduction of CO2 etc. As the global leader in providing structural waterproofing solutions, Sika has the most complete and comprehensive range of products and systems that are designed and can be adapted to meet the specific needs and requirements of owners, architects, engineers and contractors on site. Sika with worldwide experience in Waterproofing of important Infrastructure Projects. www.sika.com

is responsible for building the ambitious Cityringen project that will once again transform the Metro network. Founded in 2007, Metroselskabet has more than 200 employees and is responsible for the daily operation of the existing metro and for the construction of new lines. “It is very much a dual task that we are performing in Copenhagen,” Olsen continues. “Our primary task is to ensure constant highquality, frequent public transport, a side

“It is very much a dual task that we are performing in Copenhagen”

Passengers awaiting the Metro

BEBE Monthly Weekly [[May Issue 2014 83 ]

Why buy when you can rent? Cramo provides equipment rental services and rental of modular space. Our equipment rental services comprise of construction machinery and equipment rentals and related services. The network of 357 depots provides a wide variety of product and rental offerings according to local demand. With a total number of equipment over 200,000 and over 150,000 customers, Cramo serves construction firms manufacturing industry, the public sector and private customers in fifteen countries in the Nordic countries and Central and Eastern Europe. Equipment Rental At Cramo you can rent tools, construction machinery, work platforms, forklift trucks, access equipment, scaffolding and modular space. There is also different merchandise and accessories for sale at our depots. Tools Construction Machinery • Access Equipment Building Site Facilities (Storage, sanitary and site huts) Modular space From Cramo you can rent movable, flexible modular units. Office space • Schools • Daycare • Accomodation • Care-homes

www.cramo.com

Metroselskabet/Metro Copenhagen

effect of which is the generating of further growth within the city.” The existing two-line Metro in the city continues to increase in popularity and usage, and understandably this has resulted in considerable demand for more lines and stations. The answer to this demand was in fact agreed back in 2007 when the Danish Parliament, Folketinget, and the municipalities of Copenhagen and Frederiksberg decided on building a new route that was called Cityringen. The contract for this route was signed in January 2011, with principle construction work commencing that summer. The project itself comprises a circular underground line within the city, closely modelled on the existing metro with the

Onboard the undergound Metro system

“Our primary task is to ensure constant high-quality, frequent public transport, a side effect of which is the generating of further growth within the city” cramo Cramo is a service company specialising in equipment rental services, as well as rental of modular space. Our equipment rental services comprise machinery and equipment rental as well as rental-related services. As one of the industry’s leading service providers in Europe, Cramo operates under the Cramo brand in Finland, Sweden, Norway, Denmark, Estonia, Latvia, Lithuania, Poland, the Czech Republic, Slovakia and Russia (Kaliningrad). In Germany, Austria and Hungary, operations are under the brand of the fully owned subsidiary Theisen Baumaschinen, and in Russia and Ukraine under the brand of the 50 percent owned joint venture Fortrent. Cramo provides modern rental solutions through the Cramo Concept. Under

the Cramo Concept, construction companies and customers in trade, industry and the public sector, as well as private customers, are provided with machinery, equipment and modular space through different rental solutions and services. By combining the product portfolio with its extensive offering of services, Cramo reduces the capital invested by its customers and can create total rental solutions for every need for both the short and long term. Through a network of close to 360 depots and offices, with the total number of rental items over 200,000, Cramo’s approximately 2,500 employees serve over 150,000 customers in fifteen countries. E. info@cramo.dk www.cramo.com

BEBE Monthly Weekly [[May Issue 2014 83 ]

ALUBAR A LU B A R F LO O D G AT E S A N D F LO O D D O O R S Since the Estonia ferry accident in 1994 ALUBAR has protected ferries in international traffic against flooding on their car decks. Due to more extreme weather world wide the flood protection onshore is now the main market. In Metro stations or tunnels the ALUBAR flood gates are designed for high pressure or large openings. The protection system include sensors in the tunnels. The sensors will alert about potential water and ensure automatic closing of the flood gates and doors. The flood gates will be able to withstand a water pressure of 25 metres. ALUBAR A/S Nygaardveien 80 | 3221 Sandefjord | Norway www.alubar.com

inspired Your weekly digest of business news and views

www.bus-ex.com 48

[ May 2014 ] BE Monthly

Metroselskabet/Metro Copenhagen

alubar More wet and windy extreme weather worldwide increase the need to secure property and public facilities against flooding. The New Cityring Metro in Copenhagen, which will be in full operation by 2018, needs to flood protect 4 of its 17 stations. The Norwegian Halvorsen Group company Alubar A/S has won the contract and will use the experience from their well-known door solutions to develop and design the flood protection system together with their sister company, Engineering Research Center. www.alubar.com

same high-frequency service and short trains. The contract covers 15.5 kilometres of twin bored tunnels and last year the first Tunnel Boring Machine (TBM) started the tunnelling from one of the three shafts 40 meters underground at the work site of Nørrebroparken. By 2018 the completion of the Cityringen line and its 17 new stations will almost double the number of metro stations in the Danish capital and will result in a scenario whereby 85 percent of all residents of Copenhagen will have a station within 500 metres of their homes or places of work. The development of Metro Copenhagen

“The completion of the Cityringen line and its 17 new stations will almost double the number of metro stations”

Travelers going from Copenhagen city centre to the airport

BEBE Monthly Weekly [[May Issue 2014 83 ]

Since October 2012 I.CO.P. Denmark Aps has been executing secant piles and diaphragm walls by trench cutter, which will build the main boxes, technical rooms and ventilation shafts of some new stations of the 16-kilometer-long ring to connect the central areas of Copenhagen with the existing metro line. On the whole, 21 stations are under construction.

www.icop.it

Metroselskabet/Metro Copenhagen

“Two significant and impressive characteristics of the Metro, have been the adoption of both a 24 hour service and the use of driverless vehicle technology” in recent years has resulted in several landmark moments that have made the city’s network a pioneering model compared to others throughout the world. Arguably the two most significant and impressive characteristics of the Metro, ones that have captured the attention of other providers hoping to replicate their fortunes, has been the adoption of both a 24 hour service and the use of driverless vehicle technology. Initially, 24 hour operations were limited to weekend travel only, however this has since been extended to cover the

The Metro, bus and train services have a fully integrated ticket system

I.c.o.p. spa I.C.O.P. has executed entirely cased secant piles with diameter of 1,000mm and interaxis of 800mm up to a depth of 36m from the working surface, for a total length of 23,800m. The works also include the execution of diaphragm walls with thickness of 1,200mm and depth up to 32m. I.CO.P. has been employing for the execution of the above mentioned works three drilling rigs (BG30, BG39, BG40) equipped with kelly bar and rotary drive with diameter of 1,000mm. A drilling rig type BG28 and the cutter BC32 are being used, instead, for the execution of diaphragm walls. Soil stratigraphy mainly consists in Upper CPH

clay limestone and Mid CPH Clay limestone under ground water level. Due to the presence of numerous granite blocks, the use of rock drilling equipment (i.e. core barrel and bucket) proved to be necessary during the whole excavation process since the very first meters. Particular attention is paid to the installation of reinforcing cages. Indeed, as per technical specifications strict tolerances are to be observed, in particular with regard to pile length (+15/-5cm), rotational motion (<5°) and vertical deviation (<1/100). E. info@icop.it www.icop.it

BEBE Monthly Weekly [[May Issue 2014 83 ]

le34

Specialist surveyors LE34 creates results through dialogue and paves the way for community development in real estate, education, infrastructure and communication. LE34 is the largest surveying company in Denmark, serving the country with 290 dedicated employees across 24 offices. We perform and consult on major technical survey projects with large data sets and complex survey loops for roads, bridges and large-scale transportation infrastructure. Our services include deformation surveys, control point maintenance and monitoring, 3D documentation using terrestrial laser scanning, bespoke setting-out and surveying on challenging construction projects with stringent requirements for accuracy.

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[ May 2014 ] BE Monthly

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Metroselskabet/Metro Copenhagen

Tunnelling of one of the new lines

“The result is a Metro system providing a virtually continuous service for Copenhageners with an ‘always on’ concept”

entire week following a period of public consultation. The result is a Metro system providing a virtually continuous service for Copenhageners with an “always on” concept, where the presumption by users is they can just turn up, day or night and expect a reasonably short wait for the next train without needing to consider timetables or schedules, and have a consistently short journey time. Meanwhile, the adoption of driverless technology was unquestionably a daring

BEBE Monthly Weekly [[May Issue 2014 83 ]

The Waterproofing Company

Renescoâ&#x20AC;&#x2122;s specialists can today be found providing expert services towards the building of the new City Ring for Metro Copenhagen www.renesco.sk | www.renesco.ch

Metroselskabet/Metro Copenhagen

Cityringen consists of 17 new stations in central Copenhagen

decision, one which represents a major departure from the traditional forms of rail transport that were already operating in Denmark, and indeed throughout the world. “Metro Copenhagen was one of, if not the first Metro in the world to introduce a driverless system,” Olsen explains. “While it was a bold decision to take it has been extremely successful in that the decoupling of staff from trains has resulted in a flexible demand driven service, as opposed to a resource driven one. It has also allowed us to provider a greater degree of exposure to customers for a particular number of staff, thus offsetting the dehumanising ef fec t s of employing technology to operate the Metro.” Turning our attention back to the Cityringen project we today find Metroselskabet in the midst of a considerable

“Metro Copenhagen was one of, if not the first Metro in the world to introduce a driverless system”

renesco Three years in the Copenhagen underground Twenty more Renesco specialists are at work on building the new City Ring for Metro Copenhagen from 2013 to 2016. What’s often lovingly called the “mini-metro” has been running on its first nine kilometres of track under Denmark’s capital since October 19, 2003. In the northern metropolis’ underground, everything is a bit smaller than is usual for subways: the cars, the trains and even the diameter of the tunnel. But then the fully automatic mini-metro is truly a new development. Each of the driverless trains consists of only three cars, is 39 meters long, 2.65 meters wide and carries up to 300 passengers at a maximum speed of 80 km/h.

Renesco has to seal 21 metro stations, which on average extend down vertically 30 meters, against water pressure to 3 bar. It will take three years to line – watertight – a total surface of 150,000 m2 with 600,000 kilograms of material. Installing the sealing in Copenhagen presented some exceptional challenges – above as well as below ground. Per König: “Sometimes we work at six installation sites at a time. That isn’t that easy logistically, for the city hardly permits any construction areas for traffic reasons – not even for its own subway.” www.renesco.sk www.renesco.ch

BEBE Monthly Weekly [[May Issue 2014 83 ]

Linear Scheduling Software TILOS is designed for linear projects: • Road • Rail • Tunnel • Pipeline • High voltage lines • Metro • Light rail TILOS uses time distance diagrams to merges site information and schedule data into a single plan. The result is a clear communicative plan which quickly proves whether a project can be executed as planned or if there will be collisions. This saves time and money during a project’s execution. They are superior to Gantt Charts or Network diagrams. TILOS can also be used in combination with Primavera or MS Project to generate the time distance view with minimal effort. The strength is the graphical user interface that generates flexible high quality plans like those done with CAD, but created and updated with minimal time and costs required. info@linearproject.com www.linearproject.com

Metroselskabet/Metro Copenhagen

Workers celebrate during the tunnelling of the new line

Did you know? 130 million Number of passengers Metro Copenhagen is expected to carry per year. 15.5 km Approximate length of the Cityringen underground railway.

program of work. “Right now we have two TBMs driving the first stage of the tunnelling of the new line, with the first now some 800 metres advanced,” Olsen says. “By the end of 2014 we intend to have all box constructions and shafts complete, before commencing with the finishing works across all 17 new stations. In addition to these works we have almost completed the construction of the control centre and are now beginning with the installation of technical components along the line.”

BEBE Monthly Weekly [[May Issue 2014 83 ]

Metroselskabet/Metro Copenhagen

“We plan to have the line opened and in operation by late 2018”

Further afield in Italy the contractor tasked with building the first trains to operate along the Cityringen are working on train number 15. The progress being made across the project bodes extremely well for the completion of the works ahead of the line opening. “We plan to have the line opened and in operation by late 2018. In preparation for that we will aim to have all tunnelling, construction and installations complete by 2016, giving us a good lead in time to carry out test driving in preparation for the day Cityringen commences operations.”

Employees at Metroselskabet

comply serve Comply Serve specialises in cloud-based collaborative progressive assurance and risk management solutions for large infrastructure projects. Its ComplyPro® system has been deployed across the DKK 21.3 billion Cityringen project, which sees the construction of a new circular line in the centre of Copenhagen. Targeted for completion by 2018, the new underground Metro system presents added project complexity due to the city being situated at sea level, while the Cityringen network is sited 30m below ground level. ComplyPro is the risk management solution, spanning the entire project and used by all partners, including the on and offshore Copenhagen Metro Team (CMT). CMT is a joint venture between Salini Construction, Technimont ICB (TICB), part of the Maire Tecnimont Group, and S.E.L.I. SpA. ComplyPro provides a global ‘live’ Project Wide Hazard Record (PWHR) that

details hazards and resulting consequences, as well as potential accidents, during the risk analysis of the project design – plus the actions taken to control these risks. Silvestro Ferrara, risk manager at CMT, said: “This software tool functions as a single point of entry for risks and risk assessment throughout the project lifecycle, one that would help to avoid the continuous exchange of documents and be a live interface between all those involved in risk identification … a tool that allows for transparency, traceability, fast communication and reporting.” “Managing all the elements of risk in one place, with one prioritised dashboard, is of key importance to CMT,” commented Steve Tosh, managing director, Comply Serve. @ComplyServe www.complyserve.com

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WHEEL WASHING SYSTEMS www.mobydick.com

Road, tunnel design and more DIGICORP Ingegneria provides software for construction

companies, design studies and technical offices to public bodies. We also provide software training as well as engineering consultancy to the civil works industry. info@digicorpingegneria.com | www.digicorpingegneria.com

[ May 2014 ] BE Monthly

Metroselskabet/Metro Copenhagen

Operating now for over a decade, Metro Copenhagen may still be a young system compared to others, but it continues to have a sizeable influence both within the capital itself and on the international stage where it is seen as a model for other cities planning to develop modern transit systems. There is of course also a continued focus on ways to improve the system and deliver a better service to passengers. As a matter of fact, since the contracts for the Cityringen project were signed in 2011, a new extension to the Nordhavnen area of the city has been agreed that will see the addition of new stations in a new development area of Copenhagen. “One of our other responsibilities is to develop suggestions for new metro lines

FRUTIGER MobyDick Wheelwashing Systems MobyDick is the worldwide known brand name for high quality Wheelwashing Systems with the goal to keep the public roads clean. For the CMT Copenhagen project, 27 units of the model ConLine have been operating during the construction period. ConLine is a range of models specially designed for the needs of the construction industry and based on decades of proven technology. All systems are mobile and ready in very short time. They contributed to the intention of CMT to keep the impact on the environment, due to heavy construction, as less as possible. www.mobydick.com

“We currently have plans being considered for a line which will branch off from the Cityringen into the north of the city and a second that will branch off into southern areas”

Metro Stewards help to provide a safe and secure environment

BEBE Monthly Weekly [[May Issue 2014 83 ]

â&#x20AC;&#x153;This hugely important project will see our company being responsible for building the first light railway system in Copenhagen and indeed the first in Denmark for many yearsâ&#x20AC;?

Did you know? Metroselskabet was founded on 26 October 2007. Metroselskabet is a partnership, owned jointly by: The City of Copenhagen 50% The Danish Government 41.7% The City of Frederiksberg 8.3 %

Henrik Plougmann Olsen, Chief Executive Officer of Metroselskabet

[ May 2014 ] BE Monthly

Metroselskabet/Metro Copenhagen

View down to station level

in conjunction with our owners and we currently have plans being considered from a line which will branch off from the Cityringen into the north of the city and a second that will branch off into southern areas, so the Metro will certainly be expanding in the coming months and years” Olsen enthuses. As if that wasn’t enough, Metroselskabet has also been assigned the considerable task of constructing a 27 kilometre light railway system that will operate around the outskirts of Copenhagen. “This hugely important project will see our company being responsible for building the first light

railway system in Copenhagen and indeed the first in Denmark for many years,” Olsen concludes. “Obviously this is very much in its infancy as a project, however it is without question an exciting, long-term commitment that we are proud to be a part of.”

Metroselskabet/ Metro Copenhagen

 +45 3311 1700  m@m.dk www.m.dk

BEBE Monthly Weekly [[May Issue 2014 83 ]

Luis Muñoz Marín In

Destination P

Luis Muñoz Marín International Airport i on its way to becoming a gatewa words by

[ May 2014 ] BE Monthly

Will Daynes

nternational Airport

Puerto Rico

is Puerto Ricoâ&#x20AC;&#x2122;s largest airport and is fast ay to the entire Caribbean region research by

Abi Abagun BE Monthly [ May 2014 ]

he name José Luis Alberto Muñoz Marín is one that is revered in Puerto Rico. Born in February 1898, he was a poet, journalist, politician and statesman, and to this day remains regarded as both the “Father of Modern Puerto Rico” and the “Architect of the Commonwealth”. In 1948 Marín became the first democratically elected Governor of Puerto Rico and went on to spearhead an administration that would become lauded internationally for engineering significant

[ May 2014 ] BE Monthly

economic, political and social reforms that immensely benefited the territory. Today the name Luis Muñoz Marín adorns Puerto Rico’s largest international airport. Located in the area known as Isla Verde, construction of the airport was authorised by Marín himself in 1951. The decision to build it came in response to the changes occurring in the aviation sector at time, with many of the airlines that served Puerto Rico at the time upgrading their fleets from propelled to jet aircraft.

Luis Muñoz Marín International Airport

“The airport is today the busiest in the Caribbean by passenger traffic with over four million people boarding a plane there per year”

As well as ensuring the Caribbean nation would now possess a modern airport with a runway long enough to land jet aircraft, it would also become a major meeting point for tourism in Latin America as well as being a hub for air cargo. Furthermore, in addition to serving as an international airport it was also to become the home of the Puerto Rico Air National Guard. The airport officially opened for business on 22 May 1955, taking its current name in 1985. In the three decades between the

BE Monthly [ May 2014 ]

Atkins has been the lead designer of all airfield projects at Luis Muñoz Marín International Airport in San Juan, Puerto Rico for the past 13 years.

Atkins knows aviation. Today, more than 200 million passengers safely arrive or depart from runways constructed from Atkins’ designs. With full-service capabilities in airside, landside, terminal and environmental permitting, combined with community and airport master planning, Atkins is prepared to develop the airports of the future. Our aviation projects range from major air carrier runways to small turf runways, from large hub terminal designs to general aviation T-hangars, and from new greenfield airports to renovations of existing facilities.

Whether you’re looking for technical solutions or project innovation, let Atkins’ global experience take you to new heights.

1.787.294.2010 carlos.arboleda@atkinsglobal.com

www.atkinsglobal.com/northamerica

As part of the CIP program for Luis Muñoz Marin International Airport, Atkins designed state-of-the-art Aircraft Rescue and Firefighting Facilities (ARFF). Atkins also provided services for the Reconstruction of Runway 10-28 and associated taxiway system, including the development of the South General Aviation complex.

Luis Muñoz Marín International Airport

“Over the years the airport has been the hub for numerous Caribbean airlines”

airport grew steadily to include three terminal buildings, a 200 space car park and a second runway, which was finished in 1972. Over the years the airport has been the hub for numerous Caribbean airlines, including Pan Am, Trans Caribbean Airways and Eastern Air Lines. It also acted as the headquarters of the first Puerto Rican international airline, Prinair, from 1966 until its demise in 1984. Owned by the Puerto Rico Ports Authority, Luis Muñoz Marín International Airport is

atkins Atkins Caribe, LLP, is a Puerto Rico-based business unit of Atkins—one of the world’s leading engineering, design, and project management consultancies. Atkins Caribe blends the strength of Atkins’ worldwide expertise in engineering complex infrastructure projects with highly skilled local and North American resources to provide state-of-the art engineering, design, and project management services within the Commonwealth of Puerto Rico and throughout the Caribbean region. Atkins has a decades-long history of successfully completing a broad spectrum of projects in Puerto Rico, including serving as the general airport consultant to the San Juan Luis Muñoz Marin International Airport since 1997. Working with the airport’s management company, Aerostar Airport Holdings, LLC, Atkins has successfully supported the airport’s capital improvement program, providing airport planning and airfield

design services, pavement studies, environmental assessments, construction management services, runway improvements, and much more. For example, Atkins recently completed a major runway safety area (RSA) improvement project for Runway 8-26, the airport’s longest runway. Atkins effectively leverages the expertise of nearly 100 experienced technical and business professionals in North America and the Caribbean region who specialize in airfield and pavement engineering, planning, project management, and administrative support—a multidisciplinary team that works effectively across geographic boundaries to design, plan, and enable some of the largest and most complex aviation-related projects in the western hemisphere. The Atkins Caribe office is strategically located in the San Juan metro area, just minutes away from the Commonwealth’s federal and state governmental agencies. www.atkinsglobal.com/northamerica

BE Monthly [ May 2014 ]

Luis Muñoz Marín International Airport

managed by Aerostar Airport Holdings, a public-private partnership awarded a lease by the government to operate and manage the airport for 40 years: the airport is today the busiest in the Caribbean by passenger traffic with over four million people boarding a plane there per year according to the Federal Aviation Administration. Today dozens of airlines continue to operate out of the airport. These include the likes of American Airlines, Air America, Air Canada, United Airlines, WestJet, JetBlue Airways and Delta Air Lines. “On a typical day more than 100 flights take off and land at Luis Muñoz Marín International Airport where we service around 80 percent of Puerto Rican’s that travel back and forth from the US mainland or indeed further afield,” states Manuel Gutierrez, Commercial Director of Grupo Aeroportuario del Sureste, the Mexican company that holds a 50 percent stake in Aerostar Airport Holdings alongside Highstar Capital. “Meanwhile, those visiting Puerto Rico are predominantly tourists coming to enjoy the yearlong good weather,

Gramaslindas Landscape Established in the 1950’s Gramaslindas is the oldest and largest business in Puerto Rico dedicated to sod cultivation and related activities. Our experience in developing and maintaining an inventory of over 500 acres of sod makes us the leading supplier/ contractor for any large scale sodding job and business relation on the island. Gramaslindas has been consistently ranked as one of Puerto Rico’s top five largest landscape contractors in the Caribbean Business Book of Lists. Our business is divided into three major operations: Gramaslindas Sod Farming, Gramaslindas Landscape, Inc. and Tropigardens; a Wholesale Business that Grows ornamental plants, palms and trees. Gramaslindas Landscape, Inc., the division in wich Yamir E. Rodríguez had been involved as a Landscape Manager for the past 11 years; have

a consecutive business growth trend offering different services such as: Landscape Maintenance, Grounds Keeping, Pesticide Application, Tree Care, Planting, Interiorscape, Landscape Design, and others. We are a proud contractor of 48 projects as Home Owners Association, Hotels, Shopping Centers, Commercial Spaces, Federal Projects and the International Airport Luis Muñoz Marín. Gramaslindas is the company contracted by AEROSTAR AIRPORT HOLDING, LLC to provide hand to hand services in this International Airport. Some of the services provided inside and outside of the runways are Landscape Design, Landscape Maintenance and Tree Care on more than 400 acre around the property. This operation was directly supervised by Mr. Rodríguez in coordination with AEROSTAR. www.gramaslindas.com

BE Monthly [ May 2014 ]

Seen

vincent@bus-ex.com 72

[ May 2014 ] BE Monthly

Luis Muñoz Marín International Airport

our wonderful beaches and generally to get away and relax.” Puerto Rico’s desire to capitalise on growth within the tourist sector, and also the business sector for that matter, can be felt throughout the territory and this includes Luis Muñoz Marín International Airport itself. The publicprivate partnership deal that formed part of the agreement for Aerostar Airport Holdings taking managerial control of the airport in February 2013 included a call for the company to invest approximately $1.4 billion over the 40-year life of the lease in order to solidify it as a world-class aviation gateway. It is hoped that this level of investment will not only consolidate the airport as the principal facility serving the Caribbean but also allow Puerto Rico to compete with the 30-odd islands in the region that offer tourism. This past October Aerostar Airport Holdings announced its intention to invest $240 million on renovations to its terminal buildings, with upgrades to terminals B and C marking the first large-scale works to the airport since the company took over operations. These works follow on from other improvements made since 2008, which include the introduction of terminal A and the installation of new light systems, press conference rooms and various new retail and food outlets. “We are currently hard at work implementing a lot of changes throughout the airport,

Power Engineering Do you have millions of dollars allocated in your budget to deal with business disruptions? If not, it is crucial to adapt and adopt Power Engineering’s SPP Model to prevent high voltage electrical failures: Safety: Perform coordination, short circuit, and arc flash study. Predictive: Schedule testing of equipment to create trending and act before it reacts. Preventive: Performing annual shutdown of equipment found to have unsafe trending. Indeed, according to Eng. Agustin Arellano, CEO of AEROSTAR Airport Holdings operators in Puerto Rico, “Power Engineering has become our allies implementing energy strategies and ensuring the reliability of our high voltage electrical system. They have been vital to make our airport safe for our employees and millions of passengers visiting our facilities.” www.powerengineeringpr.com

“We are currently hard at work implementing a lot of changes throughout the airport, particularly when it comes to terminals B and C”

BE Monthly [ May 2014 ]

Did you know? 22 May, 1955 The date the airport opened for business 1985 Year Luis Muñoz Marín International Airport took its name $1.4 billion The amount to be invested in the airport during Aerostar Airport Holdings’ 40 year lease 100+ Number of flights which take off and land at Luis Muñoz Marín International Airport during a typical day

“What we are focused on doing is challenging those ... airports that are handling anywhere up to twelve million people per year, in the not too distant future” particularly when it comes to terminals B and C where we are doing things like increasing the size of check in areas, making parts of the building that were previously too narrow wider in order to increase accessibility for passengers,” Gutierrez continues. “Meanwhile we are also constructing a new security

[ May 2014 ] BE Monthly

checkpoint that will have as many as twelve access points, which we expect to have up and running by the end of this year.” There is unquestionably much work to be done, what with countless supplementary tasks needing completing as well, from re-flooring the terminal buildings to

Luis Muñoz Marín International Airport

installing air conditioning units, electrical systems, lighting and scanning technology. Nevertheless, Gutierrez recognises that the results of this work will be of massive benefit to all concerned. “While the aforementioned tasks involve a great deal of time, effort and investment, what it will mean is that we end up with what will almost be a whole new airport, one fit for the modern world,” he concludes. “In terms of passenger volumes and traffic we are rated at around number twelve in Latin America. What we are focused on doing is challenging those at the top of the list, airports that are handling anywhere up to twelve million people per year, in the not too distant future.

We realise that to do that we need to achieve that is increase our capacity, which means increasing expenditure, and we feel that is something we can make happen, while at the same time establishing this as the best airport in the Caribbean in terms of service, quality and passenger satisfaction.”

Luis Muñoz Marín Intenational Airport

(787) 289-7240 info@aerostarairports.com www.aeropuertosju.com

BE Monthly [ May 2014 ]

Mediterranean Shipp

Shipping to and fr

Backed up its fleet of container vessels and m has been linking South Africa directly words by

[ May 2014 ] BE Monthly

Will Daynes

ď ľ research

ping Company (MSC)

rom South Africa

multiple service divisions, MSC South Africa y with the rest of the world since 1978

research by

Peter Rowlston BE Monthly [ May 2014 ]

MSC South Africa operates a successful reefer cargo division

[ May 2014 ] BE Monthly

Mediterranean Shipping Company (MSC)

ounded in 1970, Mediterranean Shipping Company (MSC) has since transformed itself from a small conventional ship operator into one of the world’s largest and best known maritime transportation groups. By providing an unparalleled service network through its various offices around the globe, and through the expansion of its fleet, MSC has successfully consolidated its position as the second largest carrier in terms of container slot capacity and the number of container vessels operated. It was the founding of MSC’s EuropeSouth Africa service in the 1970s that resulted in the establishment of Mediterranean Shipping Company (MSC) South Africa. In adopting the group’s unique, innovative and flexible approach to shipping MSC

levels the company delivers to the shipping community. Perhaps equally important however is also the company’s willingness and ability to initiate change in order to the meet the constantly evolving needs of its clients. MSC South Africa operates a successful reefer cargo division, tasked with shipping temperature controlled commodities such as fruit, fish and meat to a number of destinations. In addition to its reefer equipment that comes in both twenty and forty foot capacities, the company also offers controlled atmosphere and specialised protocol shipments. The goal of the reefer division is to maintain the cold chain throughout the voyage so as to preserve the commodity being carried. By keeping transit times to a minimum the division is also able to extend the life of the

“The success of the business, particularly during the course of the last decade, can in large part be attributed to MSC’s Quality Management System” South Africa has grown to become one the biggest users of South Africa’s ports. The large fleet of container vessels that the company today boasts has allowed it to expand to deliver services along a number of major trade routes which link South Africa directly with Europe, the United States, Asia, the Middle East, Far East and Australia. Closer to home links are also provided between South Africa and numerous key ports along Africa’s West and East Coasts, Madagascar and several Indian Ocean Islands. The success of the business, particularly during the course of the last decade, can in large part be attributed to MSC’s Quality Management System. This system aims to achieve continuous improvement throughout the group, especially when it comes to service

product in question. Today MSC South Africa’s main reefer markets include the UK, the United States and Canada, the Middle East and the Mediterranean, while business continues to grow at a healthy pace in East and West Africa, and in the Far East. As the business has grown, MSC has made sure to invest in the acquisition of a number of characteristic office buildings, each of which has become something of a landmark in their respective locations of Durban, Johannesburg, Cape Town, Port Elizabeth and Pretoria. Particular attention however has been paid to the restoration of the company’s Port Elizabeth offices, housed in a building that has long held the distinction of being recognised as a national monument. The restored building was officially opened in 2004 and today is

BEBE Monthly Weekly [[May Issue 2014 84 ]

Recent investments have seen the arrival of 7 tandem lift ship-to-shore cranes at TPT’s Durban Container Terminals (DCT), Africa’s largest and busiest container terminal.

Transnet Port Terminal

Transnet SOC Limited, South Afric

We are responsible for commercial handling services of sea-r

transhipments in containers, mineral bulk, bulk and automotive. TPT commercial ports namely Richards Bay, Durban, East London, Port Eli

Karl Socikwa is the Chief Executive at the helm of the TPT business. Th 6000. Billion have been allocated for TPT and its 13 terminals as part of the market demand strategy (MDS). This amount will see TPT boost terminal capacity, develop infrastructure and reduce the cost of doing

Transnet Port Terminals services customers across a broad spectrum container industry, the general shipping industry, vehicle manufac industry, freight forwarders, cargo agents and legal entities (e.g. custo TPT employs over 6000 skilled and dedicated people geared to see our market demand strategy through to completion over the next six years.

For more information, please visit our website on www.transnetport

ls (TPT) is one of five operating divisions of

caâ&#x20AC;&#x2122;s state-owned freight transport and handling company

route freight across imports, exports and T operates terminals in seven South African izabeth, Ngqura, Cape Town and Saldanha.

he company has a staff complement of over f the R300 billion capital investment termed its cargo handling equipment base, create g business in Southern Africa.

m of the economy, including shipping lines, cturers, agriculture, steel and the mining oms).

tterminals.net

transnet port terminals

Delivering freight reliability Transnet Port Terminals (TPT) is home to two of the world’s top 120 container terminals Cape Town, Durban and Drewry’s fastest growing container terminal in the world Ngqura Container Terminal (NCT). The company is one of five operating divisions of Transnet SOC Limited, South Africa’s state-owned freight transport and handling company investing R300 billion in the expansion of port, rail and pipeline infrastructure between 2012 and 2019. A total of 13 terminals are operated by this South African terminal operator in seven of the country’s commercial ports namely Saldanha, Cape Town, Ngqura, Port Elizabeth, East London, Durban and Richards Bay. Recent investments have seen capacity creation across the company’s terminals including Africa’s biggest and busiest container terminal in the Southern Hemisphere, the Durban Container Terminal (DCT). Capacity

TPT’s transhipment hub Ngqura Container Terminal (NCT), ranked first twice in 2012 and 2013 in a Drewry Maritime Research for being the fastest growing terminal in the world

[ May 2014 ] BE Monthly

will increase to 4 million TEU after the extension and deepening of the berth on the North quay at DCT. Cape Town Container Terminal (CTCT) recently completed upgrades, the construction of additional reefer plug points and the extension of the quay wall to accommodate 1.4 million TEUs per annum. Similarly, the Ngqura Container Terminal (NCT) – South Africa’s transhipment hub is in its second phase of development to increase its capacity to 800 000 TEUs with complementing equipment. The introduction of the market demand strategy (MDS) has influenced TPT to increase its footprint in Africa and in the world offering improved connectivity to existing and new markets over the next six years and beyond. The company is creating capacity ahead of demand, growing and enhancing its skills base across its four sectors namely containers, bulk, break bulk and automotive. TPT’s growth intentions have been witnessed

TPTâ&#x20AC;&#x2122;s Cape Town Container Terminal after berth extension, making it debut in the Worldâ&#x20AC;&#x2122;s Top 120 Container Ports Â

through its extensive equipment investment in the past 12 months across all its other terminals namely Richards Bay Dry Bulk and Multi-Purpose Terminals (178km North of Durban), Port Elizabeth Terminal, Saldanha Bulk Terminal, Multi-purpose and Automotive Terminals. This includes multi million rand ship loaders, mobile cranes, ship-to-shore cranes, multi million rand unloaders and varying break-bulk equipment for its bulk, break bulk, agricultural and automotive terminals. Furthermore, TPT has signed several memorandums of understanding recently to leverage on unique opportunities presented by partners across the supply chain and industry globally. Of these, is the partnership with construction and engineering group Aveng in Mtwara, Tanzania where a new port is currently under development and proposals are open to eligible operators. There is also a number

of other value-add services and information sharing partnerships in place and in progress. The combination of all these efforts and plans is aimed at TPT fulfilling its role in growing Africa trade and enabling landlocked countries to trade internationally. The company prides itself with a workforce of over 6000 dedicated employees and intends growing this number for continued inroads in job creation. The work in progress to develop all our terminals to world-class standards with an ability to accommodate future generation vessels, will ensure TPT offers all our customers superior value, efficient service and that we deliver freight reliably.

+27 31 308 8000 tptcallcentre@transnet.net www.transnetportterminals.net

BEBE Monthly Weekly [[May Issue 2014 84 ]

Tel: 021-8630266/7/8 Fax: 021-8630269 Email: huddletp@mweb.co.za Street: Farm Lo Andre, R45, Simondium, 7646 Postal: PO Box 603, Paarl South, 7624

Long Distance Haulage We started our company in 2002. We specialise in long distance haulage to Gauteng, Durban and Port Elizabeth, handling containers, break bulk and steel loads. Additionally, all of our trucks are equipped to handle hazchem loads. We have our own super links, but we also have several dedicated transporters that work for us on a permanent basis.

Mediterranean Shipping Company (MSC)

MSC has diversified to include a Container Depot Company

â&#x20AC;&#x153;Depicting the changing times of the shipping industry over the centuries, it is rather aptly titled the Millennium Windowâ&#x20AC;?

recognised for the elaborate stained glass window that adorns its entrance. Depicting the changing times of the shipping industry over the centuries, it is rather aptly titled the Millennium Window. In moving with the times the company has also enshrined an ability to diversify into other areas of business. Such diversifications include the creation of a Container Depot Company and an Intermodal/Landside Logistics Company. Together these companies help

BEBE Monthly Weekly [[May Issue 2014 84 ]

ANE ANE INDUSTRIAL SUPPLIES (PTY) LTD.

The first official Woodward Govenor Agent for the Sub-Sahara region since 1973, making us the leaders in the service, repair, installation and commissioning of the Woodward Govenor range on the marine, industrial, milling and mining sectors. Marine services include: • Sales, repair, overhauling and servicing of pumps, injectors and marine engines • Agency to supply Wencon ship repair kits • Materials handling to warehousing and loading dock facilities Contact us: 35 Acutt Avenue, Durban North, 4051, South Africa P.O. Box 40117, Redhill, 4071, South Africa Tel: +27 31 579 44357 • Fax: +27 31 579 4359 Email: roy@ane.co.za • www.ane.co.za

We are proud to be associated with MSC.Relation is what we share, Success is what we pray and continual growth and progress is what we wish for you. Established in 1989 by its founder, Roy Naidoo, SA Fasteners have since become a leading force in shipping, automotive, civil, building and furniture industries with quality fasteners and hardware supplies. SA Fasteners offers one stop shopping for all your Hardware and Fasteners requirements. As a Master Stock Distributor, SA Fasteners offers immediate delivery on stock items. We are always ready to give you a Competitive Edge by saving you money and by being your quality on time shopper. Suppliers of all types of industrial fasteners and a wide range of tools and consumables. In our commitment to growing the S.A. economy and improving the participation of black South Africans in the formal economy, SA Fasteners employs 99% black South Africans

Community action changes people’s lives,embodies the spirit of hope and improve communities. Helping to make our communities a better place to live in

PO Box 18265, Dalbridge 4014, 161 Gale Street (Magwaza Maphalala), Durba 4001 | Tel: 031 300 7300 • Fax: 031 305 7620 43 Circuit Road, Westmead, Pinetown, 3610 | Tel: 031 700 5522 • Fax: 031 700 5090 | www.safasteners.co.za

[ May 2014 ] BE Monthly

Mediterranean Shipping Company (MSC)

provide the type of one-stop service that MSC South Africa has become known for. Individual depots can be found in Cape Town, Durban, Johannesburg, Rosslyn and Port Elizabeth. The Rosslyn depot boasts its own rail siding and provides particular benefits to clients in the motor industry as it provides easier access to their manufacturing plants. Meanwhile, the Uitenhage depot in Port Elizabeth is situated within the Nelson Mandela Bay Logistics Park and is also strategically situated in close proximity to a large global motor manufacturer. The most recent addition to the companyâ&#x20AC;&#x2122;s depot portfolio can be found within the Industrial Development Zone in East London, Eastern Cape. MSC Logistics, the intermodal arm of the company, has a longstanding contractual relationship with Transnet Freight Rail (TFR), the service provider of South Africaâ&#x20AC;&#x2122;s rail

ANE Industrial Supplies (Pty) Ltd Established over 40 years ago, Transport & Marine, currently operating under the holding company name of ANE Industrial Supplies while slowly reverting back to its original name, has grown into one of the leaders in the mechanical & electronic prime mover & generation control industries in the subSaharan region. The company was appointed as the first official Woodward Governor Service Facility outside of the USA in 1973, thus representing the leaders in the manufacture & design of electro mechanical, mechanical & electronic prime mover control systems for both marine & industrial applications. www.ane.co.za

Aerial view of Cape Town harbor

BEBE Monthly Weekly [[May Issue 2014 84 ]

“MSC South Africa has grown to become one the biggest users of South Africa’s ports”

Did you know? 1970 The year that Mediterranean Shipping Company (MSC) was founded 1978 The year that MSC South Africa was founded 1998 Year which MSC South Africa’s technical division was expanded 2004 Opening of the of the company’s restored Port Elizabeth offices 452 Number of dedicated local offices around the world 155 Number of countries in which MSC opperates 700 Number of trailers controlled by MSC Logistics

MSC is one of the biggest users of the South African ports

[ May 2014 ] BE Monthly

300 Number of trucks controlled by MSC Logistics

Mediterranean Shipping Company (MSC)

MSC South Africa is well known for providing a one stop service

corridors. The strong relationship between the pair allows MSC to offer TFR competitive rates of business, good transit times between ports and inland rail terminals, and up to date tracking through its electronic connections to its clients’ computer systems. MSC Logistics controls more than 700 trailers, more than 300 trucks and a large fleet of Owner Drivers, truck owners commissioned as sub-contractors. Together these assets cover a large road transportation service of full deliveries, empty returns and the repositioning of empties for export demand. Such resources also allow it to offer local cartage within 300 kilometres of the major ports and inland rail terminals in Cape Town, Port Elizabeth, East London, Durban, Johannesburg and Pretoria. Another venture that has witnessed a great deal of success in recent years is MSC

South Africa’s technical division, which was expanded in 1998 to include a world class, full scale engine repair and maintenance facility, headed up by a team of experienced and highly skilled South African and Italian engineers. This division of MSC South Africa, much like the company itself, has gone from strength to strength since the emergence of a democratic South Africa and shows no signs of slowing down.

Mediterranean Shipping Company (MSC)

 +27 21 405 2000  distribution@msc.co.za www.mscsouthafrica.com

BEBE Monthly Weekly [[May Issue 2014 84 ]

[ May 2014 ] BE Monthly

A flight path to the future Starlite Aviation Group A combination of its first-class track record and its proactive approach to future growth has seen Starlite Aviation Group position itself perfectly for the opportunities that East Africa will have to offer in the years ahead words by

Will Daynes

ď ľ research by

Jeff Abbott

BEBE Monthly Weekly [[May Issue 2014 83 ]

Starlite currently operates 11 Puma helicopters

ub-Saharan Africa is recognised as one of the world’s fastest growing regions and within it exists some of the continent’s fastest growing countries including Mozambique, Uganda, Tanzania and Kenya. It is in these countries that large gas and oil finds are helping to push annual growth rates above ten percent per annum, a trend expected to continue this decade. With such growth prevalent across the region it comes as no surprise to see both established and new businesses locally and

[ May 2014 ] BE Monthly

internationally, flocking to the area in the hope of using their own unique skills to procure new clients and contracts. One such business is the Starlite Aviation Group. “In addition to the work we have been carrying out over the last year in Namibia on the west coast of the continent, we have been making positive strides towards taking on additional contracts along the east coast,” explains Commercial Director, Dimmie De Milander. “During December 2013 and January 2014, we had

Starlite Aviation Group

“During December 2013 and January 2014, we had three helicopters operating on two different contracts in Madagascar”

three helicopters operating on two different contracts in Madagascar. We now intend on continuing to leverage the positive work we are doing on behalf of the offshore industry and the utilities market across Africa’s more prosperous regions.” Established in South Africa in 1999, Starlite has experienced phenomenal growth to become a multi-faceted aviation business offering a range of helicopter services on a worldwide basis. Such services include relief contract work, oil and gas, passenger

BEBE Monthly Weekly [[May Issue 2014 83 ]

and cargo transport, helicopter sales and charter, maintenance and pilot training. De Milander has been with the group since August 2007 and in that time has become an expert at what drives business and growth in the African markets in which Starlite operates. “Without doubt, the success of numerous gas and oil campaigns off the coasts of Mozambique, Tanzania and Kenya have contributed significantly towards the economic expansion of the region,” he continues. “Virtually the entire east coast of Africa is fixed for long term growth, primarily due the higher quality of seismic data being collected

across the region, the oil and gas reserves that continue to be found, advances in deep water drilling and of course the presence of stable governments. Accordingly, we have made considerable efforts to follow this growth, by acquiring both our Air Service Licence and Aircraft Operating Certificate in Tanzania, and establishing a permanent base for our operations in Dar es Salaam in order to improve our services to existing and potential clients in the country. Furthermore, we have formed a strategic alliance in Kenya with a local fixed wing operator, a partnership that puts us in a strong position to expand here as well.”

“Our philosophy has always been that, regardless of race, culture or creed, we remain ever mindful of those in need”

A donation we made to Jodi Jackson dance academy

[ May 2014 ] BE Monthly

Starlite Aviation Group

The Bell 412 reliably performs in the most extreme climates on the planet every day

There is no question that Starlite possesses the vast majority of the intangibles needed to prosper in East Africa. The group’s standard of operations is at the level it needs to be. Safety and quality standards, of paramount importance to Starlite, have been audited by regulatory bodies, and its helicopter fleet is comparable to any of its competitors. Nevertheless, a trend is emerging off the coasts of Mozambique, Tanzania and Kenya that up until now posed a challenge, and that is the fact that oil companies are being driven further out to sea to lay claim to vast deposits of oil and gas. This situation resulted in Starlite looking at expanding its fleet by investing in helicopters capable of travelling further offshore. It is closer to home, however, that one will find what De Milander refers to as the crown jewel of the group, that being its International Aviation Training Academy. Since 2003, Starlite Training operated from its base at Virginia Airport, ten kilometres

north of Durban, South Africa. In June 2011 the group relocated to what is now its primary training base in Mossel Bay, South Africa, on the Mossel Bay Air Field. The latter offers the perfect terrain and yearround good weather to provide future pilots with value-added training services. The Training Academy offers training for helicopter aircrew, maintenance personnel and operational support staff to a level of competence commensurate with leading military and aviation safety standards. “Today our Academy is responsible for training the vast majority of sub-equatorial African air forces and police divisions,” De Milander says. “The Academy has trained pilots from the South African Air Force, the Botswana Police Air Wing, the Kenyan Police, Army and Air Force pilots, and the Namibian Police, as well as 19 students from Transnet and many civilians. Furthermore, we are in the process of finalising talks with Tanzanian clients and entering into fresh discussions with our

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“While the success of the Training Academy is apparent, perhaps a less well publicised facet of the Starlite Group is its work with local communities and charities” partners in the UAE, whose Special Forces Pilots we have trained in the past. Needless to say, this area of the business is booming at present, and we put that down to the simple fact that we provide a consistently exceptional standard of training that is at the very least on par with any other provider globally.” He continues, saying: “The Training Academy expanded its training to include

[ May 2014 ] BE Monthly

a Fixed Wing Division, upgraded its fleet to include the Robinson R66, purchased to provide single turbine conversions. Furthermore, it introduced the Guimbal Cabri G2, to the training fleet and was the launch customer for Africa, of this stylish, safe, technologically advanced and comfortable helicopter for Africa. Always one step ahead of the market, the Academy took delivery

Starlite Aviation Group

A view from the cockpit indicates the type of conditions Starlite operate in

of the JAR/EASA/SACAA approved Elite Evolution S723T FNPT II MCC simulator, based on the Eurocopter, AS-335 Twin Engine Helicopter. The fixed wing equivalent will be delivered in April 2014.” While the success of the Training Academy is apparent, perhaps a less well publicised facet of the Starlite Group is its work with local communities and charities. De Milander is personally involved in outreach programmes, having completed a 500 kilometre cycle challenge back in October 2013 in order to raise money for PATCH – The Centre for Abused Women and Children. He was also instrumental in Starlite’s monetary contribution to the Jodi Jackson School of Dance in Cape Town. Starlite plays an active role in the Reach for a Dream

Foundation, turning the dreams of flying, of terminally ill patients, into a reality. Starlite supports and gives monetary contributions to the ‘Toy Story’ fund, Agro Bio (Pty) Ltd, a fund providing farming equipment and infrastructure support to farming projects and the Seed of Hope feeding scheme. “Our philosophy has always been that, regardless of race, culture or creed, we remain ever mindful of those in need. If a community is seen to be struggling Starlite provides support and endeavours to do the very best to help,” De Milander enthuses. “The types of projects we have provided support to over the years have been extremely varied and have included supporting a foster care home in Durban, the development of young rugby players from poor backgrounds and

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Did you know? Starlite Aviation Group is a privately owned company made up of a select group of aviation experts. The Starlite fleet includes: PUMA  SA 330 J PUMA  Eurocopter EC120  Eurocopter EC130

Starlite Aviation will soon be operating three Bell 412’s on contract

“We are currently working tirelessly to secure multi-year contracts with clients working offshore in the oil and gas industry”

donating money for equipment and gear for a local ballet school. Each project is deemed important and we take great pride in supporting the communities in which we serve, as best we can.” Regarding Starlite’s business plans for 2014, the focus and strategy revolves around expanding operations to gain an even greater foothold in Africa’s more promising regions. Starlite recently purchased and was the launch customer of the new Airbus AS333 C1e.

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ROBINSON  Robinson R22 Beta II  Robinson R44 Raven I  Robinson R44 Raven II  Turbine Helicopter R66 BELL  Bell 206B Jetranger  Bell 407  Bell 212  Bell 412

The initial order of two of the aircraft has since been increased. This is part of Starlite Aviation’s fleet renewal and expansion program, with the rotorcraft joining an extensive helicopter fleet that currently includes twelve Airbus Helicopters SA330 Pumas. The AS332 C1e offers versatility across a full range of utility missions, especially in hotand-high environments, as well as missions requiring a small footprint while delivering a significant lift capability such as the vertical

Starlite Aviation Group

The SA 330 J PUMA on deck

replenishment of ships and other offshore and onshore work. Included in its standard equipment list is the four-axis autopilot and associated automatic flight control system from Airbus Helicopters’ EC225 Super Puma helicopter, which provides flight envelope protection, unrivalled precision, and stability in even the harshest operating conditions. If equipment or systems are required beyond the baseline definition, additional customisation can be provided by Airbus Helicopters and its wholly-owned Vector Aerospace Company, or the network of subsidiaries and approved partners. “We are currently working tirelessly to secure multi-year contracts with clients working offshore in the oil and gas industry, in regions in Africa, which is an achievable goal with our existing fleet of aircraft. De Milander concludes. “At the same time we are proactive in pre-planning in our area

of expertise in operations, by training our crew, technicians and maintenance staff on a new model of aircraft for the group, the AgustaWestland AW139. By providing training in the early stages, Starlite is ensuring that we create a situation where we have the finance available and manpower in place, for the purchase and operation of said aircraft. Furthermore, that will ensure that its integration into our fleet will be a rapid, efficient and smooth transition. This is just another example of how we are always looking to position ourselves perfectly for the next stage in our development.”

Starlite Aviation Group

 +27 (0) 31 571 6600  dimmied@starliteaviation.com www.starliteaviation.com

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Hard Rocks Eurostar Diamond Traders One of the worldâ&#x20AC;&#x2122;s leading diamond wholesalers and diamond manufacturers, a passionate and principled family business that has made a serious impression on the world market: we spoke to its founder Kaushik K Mehta words by

John Oâ&#x20AC;&#x2122;Hanlon

research by

Jeff Abbott

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iamond and adamant are two words coming from a common Greek root meaning unalterable, an appropriate name for the hardest substance in the natural world. It’s their resistance, their durability, that has made them the ultimate jewel. Rough diamonds as mined are unprepossessing, but once they have been cut and polished to refract light from a myriad facets their beauty is breathtaking. But cutting and polishing is no easy matter as the only substance hard enough to impress diamond is – more diamond. Cutting is performed by highly trained craftsmen with years of experience, since it is a very technical process that involves assessing the qualities and structure of each stone. Polishing is a laborious and time consuming task that also needs special training. For centuries India has been the undisputed centre of the world diamond trade and until recently more than 90 percent of diamonds were cut and polished there. And India is where Eurostar has its origin. “Both my father and my grandfather were in the diamond business,” says Kaushik Mehta, who co-founded the company at Antwerp, Belgium, in 1978 and is today its Chariman and CEO. Mehta began his career in 1966 in Tamil Nadu India, where he simultaneously managed a jewellery retail store and a small diamond cutting and polishing plant at Coimbatore. “So the diamond trade is a family enterprise and our family never knew any other business!” Though India remains the home of the industry, by the 1970s the home market

“The diamond trade is a family enterprise and our family never knew any other business!”

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Polishing the pavilion facets

Eurostar Diamond Traders

“Since Antwerp is really the rough diamond trading centre of the world I came there to buy rough diamonds to ship them to my company in India to be cut and polished there”

started to move from cutting and polishing to consumption – today India is the third largest consumer of gemstone diamonds after the USA and China, he says. “Since Antwerp is really the rough diamond trading centre of the world I came there to buy rough diamonds to ship them to my company in India to be cut and polished there.” At that time he started to differentiate his business by buying the best quality rough diamonds, cutting and polishing them in Belgium, and then supplying them to the retail trade in India. He must have got a lot of things right. The company grew exponentially. In 1994 the company established its main diamond cutting and polishing centre in China, where it now operates from three locations. In 2001, Eurostar completed the acquisition of a significant stake in The Hearts on Fire Company, making it the leading producer of Hearts & Arrows diamonds, a cut unmatched in precision, beauty and perfection, offering edge-to-edge ‘electric’ brilliance with white and coloured highlights, even in low light conditions. “The Eurostar Hearts & Arrows diamond is a brilliantly beautiful, ideal-cut diamond that exhibits a distinctive, perfectly symmetrical pattern in the table,” he stresses. “The secret is perfect facet alignment along all of the diamond’s angles so that

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“The secret is perfect facet alignment along all of the diamond’s angles so that each stone refracts light to the maximum” each stone refracts light to the maximum,” he adds. To achieve this Eurostar gemmologists are trained in the use the most sophisticated testing equipment such as refractometers, spectroscopes and microscopes to identify and analyse the stones. They evaluate precious stones with confidence and prepare

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special identification and appraisal reports and have all been trained either at HRD Antwerp, the largest diamond laboratory in the world which adheres to the rules set by the International Diamond Council for grading polished diamonds, or the prestigious GIA, the leading source of knowledge, standards, and

Eurostar Diamond Traders

Every Eurostar diamond undergoes 32 meticulous quality checks before reaching your doorstep

education in gems and jewellery founded in New York in the 1930s. In 1981 he acquired a factory in Belgium employing 135 people: just over ten years later, in 2002, Eurostar’s annual turnover exceeded $1 billion for the first time. In the same year Eurostar Diamond Traders Shanghai was founded and the company, already a De Beers Sightholder (a company licensed by De Beers’ subsidiary Diamond Trading Company (DTC) to purchase rough diamonds from the world’s largest diamond mining company) was awarded a second DTC Sight in Botswana. More recently, in 2010, the group has established both Eurostar Diamond Traders Hong Kong Ltd. and Eurostar Diamonds India Pvt Ltd, the

latter run by Paresh Mehta, brother of Kaushik. Today Eurostar employs 5,000 skilled people in China, India and Belgium. 2013 was a difficult trading year in the diamond industry – unsurprisingly in light of the global recession which was not kind to luxury goods. 2014 is already promising to be a better proposition, he predicts, with demand rallying. The downstream industry is demonstrating demand from non-traditional sources, well outside the jewellery trade for example the Rolls-Royce car shown in Dubai last year with no fewer than 446 diamonds hand-set into the door panels, centre console and cabin privacy partition. The pinch point in the value chain will

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â&#x20AC;&#x153;Seven or eight mining companies mine and sell rough diamonds: maybe a thousand manufacturers compete to buy them and polish themâ&#x20AC;?

Kaushik K. Mehta Founder

Sawing quality control

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From the very first moment when I founded Eurostar Diamond Traders in 1978, we have applied passion to everything we do. A passion for excellence, a passion for innovation, a passion for purity, a passion for servicing our clients, and above all, a passion for the p e r fe c t dia mon d masterpiece.

Eurostar Diamond Traders

Sorting diamonds

continue to be on the supply side. “The problem is we have got seven or eight mining companies mining and selling rough diamonds, and maybe a thousand manufacturers all competing to buy them and polish them.” Around 50 percent of the diamonds his company buys come from DTC, the remainder from a variety of open market sources, he adds. “We procure a lot of these goods from Russia and a growing quantity from Angola.” Cutting and polishing, beneficiation in other words, is the core business of Eurostar Diamond Traders, and will remain so. With the truly unique skills base it has built up over decades the company is unlikely to reduce its cutting and polishing capabilities. However Kaushik Mehta’s eyes are now fixed on the consumer. It has always retained teams made up of highly experience professionals whose job it is to remain in direct contact with

its key retailers in the important sales and marketing centres it has established in places like China and the USA. However he now wants to expand the company’s presence at the sharp end. “One of my visions is to go downstream more in to the retail business. We have a retail company in Chennai and about ten stores right across South India – and we are looking to expand those stores.” With a presence in nine Indian cities he wants to target the main centres of population in India, he says.

Eurostar Diamond Traders

+32 (0)3 213 77 77 info@eurostardiamond.com www.eurostardiamond.com

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Enriching a nation De Beers Debswana The world’s largest diamond producer by value, Debswana is Botswana’s largest private employer and arguably the biggest contributor to the country’s economic growth words by

Will Daynes

 research by

Peter Rowlston

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he mining industry has been an integral part of Botswana’s national economy since the early 1990s. At the heart of the industry for the better part of 25 years has been the country’s diamond sector, whose gem quality findings have seen Botswana solidify its position as the world’s leading producer of diamond by value. Debswana is an important figure within this vital part of Botswana’s economy, producing in excess of 70 percent of the country’s export earnings, 30 percent of its Gross Domestic Product and 50 percent of government revenue. The originals of the company date back to 1969, when De Beers entered into a 50/50 joint venture with the government of Botswana to unlock the country’s rich diamond resources. The joint venture, Debswana, is now the largest non-government employer in the country, employing approximately 6,300 people, 93 percent of them local. Debswana today operates some of the world’s richest diamond mines. The mines in question are the Jwaneng Mine, the world’s leading producer of diamonds by value, the Damtshaa Mine, the Letlhakane Mine, and the Orapa Mine, which is the second largest open pit mine on the planet. Together these mines were responsible for producing 22.8 million carats in 2011 alone. The flagship of the company, due to the substantially higher dollar per carat

“Debswana maintains that at the heart of its operations is its regard for the safety and wellbeing of its people and the environment”

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Debswana values its local employees

De Beers Debswana

“De Beers has continued to identify ways to maximise the sustainable benefits of Botswana’s natural resources through the process of beneficiation” obtained for its gems, is its Jwaneng Mine, which became fully operational in August 1982, when it was officially opened by the then President of Botswana. Currently being mined to a depth of 350 metres, the resource itself consists of three separate volcanic pipes and vents. Production normally varies according to mining plans of approximately 12.5 to 15 million carats per year. As is the case with all of Debswana’s mines, the Jwaneng Mine is an open pit operation, one which is currently playing host to a landmark expansion project, which will see the pit elevated to the status of a superpit. The scope of the project, dubbed Cut 8 involves the delivery of an indicated resource estimated down to 850 metres below surface. This project will take a total of 14 years to complete and will ensure continuous production from the mine until at least 2024. The youngest of Debswana’s mines is the Damtshaa Mine, which began operating in 2003. Damtshaa has been forecast to yield five million carats from 39 million tonnes of ore that are to be mined over the 31 year projected life of mine. The mine has been incorporated to the Orapa & Letlhakane Mines safety and environmental programmes, and hence it is ISO 14001 certified. It has thus far been audited twice by the SABS Surveillance Audit Team and confirmed to be compliant to ISO 14001 requirements.

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De Beers Debswana

The aforementioned Letlhakane Mine can be found 190 kilometres west of Francistown, in Central Botswana. First discovered during the sampling and evaluation process at the Orapa Mine, which we will come to momentarily, the Letlhakane Mine officially became the company’s second mine when it opened in 1975. In 2006, the mine broke records for diamond recovery when 1.089 million carats were recovered. Lastly we come to the Orapa Mine, a conventional open pit development. With production dating back to July 1971 it is Debswana’s oldest running operation and one that continues to contribute significantly towards the company’s total carat output. To this day the Orapa Mine remains among the largest open cast mines found anywhere on the planet. Across each of its mines Debswana maintains that at the heart of its operations is its regard for the safety and wellbeing of its people and the environment, with all of

Employee at the mine site

DEBSWANA MINING AND ISOMETRIX GROW TOGETHER IsoMetrix’s involvement with Debswana Mining began in April 2012 when IsoMetrix was awarded the contract for the replacement of the company’s existing Safety, Health and Environmental (SHE) system with the IsoMetrix SHE Software Solution. The completed system, used by close to 1000 employees, has been implemented at Debswana Head Office in Gaborone as well as at their Jwaneng and Orapa Mines. The system was designed around existing company processes that were well thought through, which resulted in a world class SHE solution that matched their requirements precisely. Good relationships were formed in particular with the Projects, IT and SHE Departments, resulting in a continuous symbiotic partnership. The flexibility of the IsoMetrix Agile Application Framework means that as Debswana’s requirements grow, the solution can be modified and developed to incorporate other processes. Currently, additional enhancements to

the existing system are being discussed as well as the incorporation of other processes encompassing Environmental Monitoring and Sustainability as well as Management Review. Stephen Simmonds, Executive Head: Business Development at IsoMetrix, says, “Debswana are to be congratulated on the way they have internalised the system and ensured its utilisation to the fullest capacity. The company has also made a large investment through the training of all its employees that make use of the system thereby ensuring that the system is not only utilised but optimised to the fullest. This investment will continue to ensure a maximum return.” Metrix has recently expanded the IsoMetrix solution beyond SHE to include suites for enterprise risk management, compliance, controlled self-assessments and full sustainability management and reporting. www.isometrix.com

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its efforts in these areas geared towards its ZERO HARM vision, one that calls for it to remain a sustainable and responsible miner. In 2004 the Orapa and Letlhakane Mines were awarded some of the highest international accolades, which came in the form of a five star rating from National Occupational Safety Association (NOSA), with a score of 91.5 percent, and ISO 14001 re-accreditation. In addition, the Orapa and Letlhakane Mines achieved two million fatality free shifts. It is also at Orapa where the company maintains a 100 bed hospital that caters for employees and acts as a referral hospital for the region. Employeesâ&#x20AC;&#x2122;

De Beers Debswana

Sunset on the Orapa mine

children also have access to pre-primary and primary schools run by Debswana. Debswana’s recognises that its responsibility towards the nation of Botswana extends to future generations and as such it ensures that it conducts business in such a way that it minimises any impact on the environment. This, it achieves in partnership with the communities that live around its mines who it realises possess valuable input that can transferred to its environmental management programmes. In recent years, De Beers has continued to identify ways to maximise the sustainable benefits of Botswana’s natural resources

through the process of beneficiation. Beneficiation seeks to ensure that beyond mining, as many of the diamond processing stages as sustainably possible take place in country. This will continue to be a core driver of the business going forward.

De Beers Debswana

 +267 361 4200  info@debswana.com @DeBeers www.debswana.com

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KGHM Polska Miedz -

Strength i

As the Sierra Gorda Project enters an exciting new phase reflects on how the collective efforts and achievement words by

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Will Daynes

- Sierra Gorda Project

in numbers

e of its life, Senior Vice President of the project, Joseph Tis ts of its workforce made 2013 such an important year research by

Abi Abagun BE Monthly [ May 2014 ]

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Secondary crusher & HPGR

s Joseph Tis, Senior Vice President, explains, 2013 was an important year for the Sierra Gorda open pit copper mine project. “In February of last year the project budget, valued at $4,000 million was updated. In the months that followed the project went on to complete a consolidated advance of 52.9 percent, reaching 91.2 percent in February 2014.”

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Located within Northern Chile’s Atacama Desert, the Sierra Gorda Project is a joint venture between KGHM International Ltd., Sumitomo Metal Mining and Sumitomo Corporation, and possesses deposits that total up to 2.2 billion tonnes of measured and indicated resources, and reserves amounting to some 1.3 billion tonnes. In addition to completing detailed

KGHM Polska Miedź - Sierra Gorda Project

“We have made a number of great advances in the construction plant over the last year or more”

engineering and locking down the purchasing of equipment, 2013 also saw Sierra Gorda benefit from the completion of infrastructure works designed to supply the site with electricity and water. Both 110Kv and 220kV electricity lines are now positioned on site, with the 110kV line going live during March of this year and the 220kV being brought into action the following month. In addition

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We work with the

BEST! With over 400 knife gate valves in Sierra Gorda, Scancontrols with our partner RF Valves keeps providing high quality for the mining industry. RF Valves for Heavy Duty operations, are designed to control abrasive fluids, specially for adverse conditions where common valves are no good. Scancontrols is also in other large mining projects in Chile, continuing contributing to the quality of the processes with our represented brands. Email: info@scancontrols.cl www.scancontrols.cl

KGHM Polska Miedź - Sierra Gorda Project

“Particular milestones achieved during 2013 included the delivery of the Truck Shop to operations” to the completion of these power lines, the assembly and welding of the project’s sea water aqueduct has also been finished. A particularly striking example of the progress made at Sierra Gorda over the last 12-18 months comes in the form of the project’s processing plant. “We have made a number of great advances in the construction plant over the last year or more,” Tis agrees, “going from eight to twelve percentage points during the months between August and December 2013 alone. Particular milestones achieved during 2013 included the delivery of the Truck Shop to operations, delivery of shovels 4 and 5, and the delivery of 17 haul trucks for use in Prestripping extraction operations.

Conveyor belts

scancontrols Scancontrols, control valve specialists, provides and advise our clients in Chile, on all matters relating to valves and fluid control. This, seen as the core of our development, has made us leaders in the industry, thanks to our fast response, performance and reliability. Founded in 2001 with the aim of providing the market with the best solutions for handling fluids via control valves, including engineering for selecting the type and size of valve, actuators and materials for each case. Our company has a full line of control valves and on / off valves, as well as manual valves for all types of processes. Also we offer diagnostic, maintenance and repair services of the valves in the city of Antofagasta. This service has allowed Scancontrols

to make a difference and obtain a good position in the local market as one of the few companies able to offer integral solutions for fluid handling with valves. Scancontrols represents in Chile top brands such as SOMAS (Sweden), RF VALVES (USA) and Ringo Válvulas (Spain), which added to our Help Desk, Maintenance and Repair Team, leads to excellence and guaranteed results. Our services cover all industries including Mining, Pulp & Paper, Refineries, Petrochemicals, Power Plants, and others. “With a sustained growth in over 10 years of existence, Scancontrols is in a very strong position to continue expanding the services and products to new projects and markets” www.scancontrols.cl

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What makes that a certain company has been selected as a support in the development of a great mining project in Chile?

SCM Sierra Gorda

has chosen Ingeniería de Transportes Javier Cortés S.A. as his support for the transport of all their necessary supplies for the construction and start up of the SIERRA GORDA project located in the Antofagasta region. No doubt this is a great recognition for Ingeniería de Transportes Javier Cortés S.A. a company of a large and historical trajectory in the movement of oversize and overweight transport in the Chilean mining. The history of the company is certainly confusing with the growth of the Chilean mining after it started as a transport company for general cargo it is now specialized in the transport and operation of special cargo according to the development of the Chilean mining beyond of the 70’s. Ingeniería de Transportes Javier Cortés S.A., with more than 50 years in this business, has been stand out to transport the most heaviest and difficult cargoes in Chile, and that the transport on off-road trails to locations at 5,000 m.o.s.l. hasn´t been an obstacle to his successful career. For the construction of the Sierra Gorda project it was necessary to perform more than 5.000 voyages with import cargoes and domestic supplies. In order to address adequately this project, Ingeniería de Transportes Javier Cortés S.A. increased its fleet of modular equipments and trucks in order to fully meet the expectations of the client. With the result of this project we are very optimistic to keep and strengthen a long-term relationship with Sierra Gorda in order to participate in their upcoming projects in Chile. We take this opportunity to wish Sierra Gorda the best of success in the start up of the mine. Ingeniería de Transportes Javier Cortés S.A. is also actively involved in the development of wind farm, photovoltaic, thermoelectric, hydroelectric, cellulose, refineries and others projects as well in the consulting prior to project implementation phases.

www.javiercortes.com

KGHM Polska Miedź - Sierra Gorda Project

Sea water pond

“As of January 2014, we have calculated that more than 44,000 people have directly contributed to the construction of the project and its various elements”

Furthermore, 2013 saw the installation of all critical plant equipment.” Tis is keen to add that all of the achievements already mentioned have been as a result of the tireless work of the project’s workforce performed in the field. During the month of October, 2013, employment activity on site reached a peak of 9500 workers, while 2013 as a whole saw a total of 11,236,934 man hours earned. “As of January 2014, we have calculated that more than 44,000 people have directly

contributed to the construction of the project and its various elements,” Tis states. “Each and every one of these people have at all times remained committed to our “Zero Harm” ethos, our most fundamental value which enforces our commitment to the health and safety of our employees and the communities in which we operate, and in doing so have not only met, but often exceeded expectations.” As a company KGHM has long been proud of the fact that it acts as a major contributor towards employment generation, regardless

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KGHM Polska Miedź - Sierra Gorda Project

of where it is based. This is very much the case with the Sierra Gorda Project, what with a great many of the 44,000 people who have contributed to its development coming from regions surrounding it. The largest contributor to date has been the VIII Biobío Region, from which the project has employed some 9,557 people, or 21.6 percent of the 44,000. Other major contributors have been the II Antofagasta Region, the Santiago Metropolitan Region XIII and the V Valparaíso Region, with 7,505, 7,085 and 6,306 residents employed on the project respectively. On top of these figures, no fewer than eleven other regions, from the XV Region of Arica and Parinacota, through to the XII Region of Magallanes have also contributed employees to the project. In addition to the creation of jobs, the Sierra Gorda Project has also contributed in

Stock pile

“In addition to the creation of jobs, the Sierra Gorda Project has also contributed in other vital ways to the local and national economies of Chile”

hatch Hatch supporting Sierra Gorda from the beginning Sierra Gorda retained Hatch since mid 2012 to develop the detail engineering of their Molybdenum plant. The project has been a success from the engineering and procurement stand point and is currently well under way in construction. Hatch has not only done detail engineering to the Sierra Gorda Molybdenum plant but has supported Sierra Gorda as a key client and continued helping Sierra Gorda with the Moly plant Field Engineering Services, Pre-Commissioning & Commissioning support services for the entire Copper-Moly Concentrator,

procurement support services and has as well reviewed the Basic Engineering of their concentrator future expansion. For Hatch, Sierra Gorda has been an excellent client, and one very good example of client engagement and commitment of our core values, all required to create and enhance a long term relationship adding the best possible value to our clients. The multidiscipline capabilities available at Hatch and the global availability of our experts have given us the strength to commit with Sierra Gorda in one of the largest mining projects of the continent. www.hatch.cl

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Instruvalve Ltda

Quality at your disposal

“Instruvalve”, a Chilean Company with ten years of experience when it comes to the control of fluids and automation, supplied a package of electric actuators from Limitorque USA to the Sierra Gorda Mine project. The Limitorque actuators are used to operate ball and gate valves in the raw water sea pumping stations of the mine’s plant. Instruvalve also assisted in the implementation of the system. Instruvalve is grateful and thankful for the confidence shown by Sierra Gorda and is

proud of be a technological partner of the mine, wishing it great success in its future operations. In its portfolio of products, “Instruvalve” also offer hydraulic/electric actuators, valve positioners, field instrumentation and heat exchangers. (55) 2944 369 ventas@instruvalve.cl www.instruvalve.cl

Valves – Automation – Instrumentation • Control Valves • Positioners • Hydraulic / Electric Actuators • Field Instrumentation • Heat Exchangers

QUALITY AT YOUR DISPOSAL

Instruvalve, dedicated to providing quality products and services to the Mining, Energy, Oil & Gas, and general processes industries, provides its clients with world-class brands, excellent after-sales service and a highly qualified team. POST-SALES SERVICES: Technical Services: Branch offices with highly qualified workshops for the maintenance and configuration of equipment.

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Field Services: Visits projects to make preventive check-ups to avoid halts in the productive processes.

Technical Consultancies: Highly qualified professionals who advise and guide the purchase of equipment and/or services.

Training: Technical and usage training orientated to obtain better performance of the equipment.

KGHM Polska Miedź - Sierra Gorda Project

Primary crusher

“The existence of this project has not only helped strengthen the local mining industry, but also will contribute to the increased supply of copper on a national and international scale”

other vital ways to the local and national economies of Chile. “The existence of this project has not only helped strengthen the local mining industry, but also will contribute to the increased supply of copper on a national and international scale,” Tis says. “In doing so we have also played our part in ensuring that the country remains a leading global player when it comes to the production of copper, and in showcasing

the professional quality and expertise of workforce, taking a massive development project from start to finish, we have helped send out a message to investors that Chile is a country worth taking notice of.” Giving back to the community is a trait that in many ways has characterised the project since its inception. To this day it arguable remains best reflected in the development, construction and

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â&#x20AC;&#x153;In the short term our efforts are very much focused on completing the construction and pre-commissioning phases of the processing plantâ&#x20AC;?

Did you know? Progress on construction (at 31 December 2013) Project will be completed on time, planned completion of construction and commissioning in mid-2014 Total project progress is 86% complete Construction of sea water pipeline 94% complete, final hydraulic testing in progress Construction of tailings pond approx. 86% complete and processing plant approx. 80% complete Pre-stripping at 81% of the amount required before commissioning Around 96% of the CAPEX committed

Process plant

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Around USD 3.4B of the committed amount has been incurred

KGHM Polska Miedź - Sierra Gorda Project

Tailings thickener

implementation of numerous infrastructure projects that have helped improve quality of life within the region. Such projects include the construction of a wastewater treatment plant, the expansion of security checkpoints and the installation of CCTV to provide a safer environment, and the implementation of programmes designed to protect native flora and fauna. While 2013 was certainly an important year for the Sierra Gorda, 2014 could prove to be an even greater milestone, what with production at its processing plant due to commence this year, thus ushering in a new phase for the project. “In the short term our efforts are very much focused on completing the construction and pre-commissioning phases

of the processing plant, and subsequently bringing it online, all the while fulfilling our Zero Harm commitments” Tis concludes. “Throughout the remainder of the year we will be bringing several other projects online and by December 2014 we expect to have completed the ramping up of production to bring it up to 110,000 tonnes per day.”

KGHM Polska Miedź Sierra Gorda Project

562-336-5200 info@kghminternational.com www.quadrafnx.com

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Barrick Sou

The jewel in

Barrick had a significant investment programme for South A construction of Pascua-Lama, the worldâ&#x20AC;&#x2122;s first bi-national m edited by

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Will Daynes

research

uth America

n the crown

America in 2013, much of which was targeted to advance the mine, expected to be operational in the second half of 2014

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Barrick Goldâ&#x20AC;&#x2122;s Veladero mine in San Juan province, Argentina

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Barrick South America

ith the acquisition of Placer Dome in 2006, Barrick Gold Corporation became the largest gold mining company in the world. Barrick’s holdings in South America include the Pierina and Lagunas Norte gold mines in Peru, the Veladero gold mine in Argentina, the Cerro Casale project in Chile, and the world class Pascua-Lama project on the Chile/ Argentina border. With a mine life estimated at 25 years, Pascua-Lama is the current jewel in the crown, but as the world’s first bi-national mine it has required a complex series of negotiations with two national governments. At an elevation of up to 5,200 meters, this is also the highest altitude project Barrick has ever tackled, and it raises many unique logistical challenges.

that currently stand at a massive 23.2 million ounces, but exploration is still in progress and there may be even more. Cerro Casale was originally a 50/50 exploratory joint venture between Barrick and Kinross Gold Corporation, but early in 2010, Barrick acquired an additional 25 percent interest from Kinross, increasing its interest in the project to 75 percent. The construction phase will last about three years and the life of the mine is estimated at approximately 20 years, with average annual production expected to reach one million ounces of gold and 110,000 tonnes of copper. Now with a controlling interest, Barrick is keen to use the lessons learned in PascuaLama to good effect and where possible, leverage synergies in the design and

“Construction has advanced steadily, with production expected to commence in the second half of 2014” Nevertheless, it is destined to become one of the most important mines in Barrick’s global portfolio, with proven and probable reserves of 17.8 million ounces of gold, and an additional prize of 671 million ounces of silver. Construction has advanced steadily, with production expected to commence in the second half of 2014. At the end of November 2012 the tunnel to transport the ore between Argentina and Chile was approximately 60 percent complete, and 90 percent of the materials and equipment required for the process plant had already been committed. During the first five years of production, Barrick expects an average of 800,000 and 850,000 ounces of gold per annum. Another project in development is Cerro Casale, 130 kilometres north of the PascuaLama project in the Maricunga district of Chile. This project holds estimated gold reserves

construction of Cerro Casale. This is one of the largest undeveloped gold-copper deposits in the world and it is envisaged that it will one day exceed the production anticipated at Pascua-Lama. As well as these two stellar development projects, Barrick can also count on a solid portfolio of mines already in production. The Veladero mine, located in the San Juan Province of Argentina, is immediately south of the Pascua-Lama property in the highly prospective Frontera District. Veladero has two open pits, Filo Federico and Friendly and has an estimated life of 14 years. The mine has been in production since 2005 and in 2011 produced 957,000 ounces of gold at a total cash cost of $353 an ounce. The proven and probable mineral reserves at 31 December, 2011 were 10.6 million ounces of gold.

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corplab For those of us in charge of managing ALS Corplab in the region, it is a satisfaction to be considered Barrick Gold´s “strategic partners” in Latin America. On this concept, today we have the possibility of providing our environmental services in different countries of the region. In Argentina, we started performing specific services back in 2001. Since 2004, we have provided services in Chile, being the first relevant contract the Veladero and Pascua Lama, done in 2008. From San Juan, Argentina and since 2010, from Chile, we have serviced Casale and Zaldívar projects. Later, in 2011, we had the opportunity of replicating our service standards in Peru, in Lagunas Norte and Pierina facilities. Since 2013, we are participating with Barrick in the Pueblo Viejo Project in Dominican Republic. On a more than ten years continuous interaction, we have succeeded in identifying the mystic of their work style, interpreting the required excellence standards to meet their needs that enable Barrick´s operations in Latin America to be environmentally sustainable. We pride ourselves on this. www.corplab.net

Moving to Peru, Barrick has the Pierina mine, located in the Andean Cordillera in the Department of Ancash. This mine has proven and probable mineral reserves of 791,000 ounces of gold, and although it is relatively more expensive to produce than in other mines, rising gold prices have recently seen the mine’s life extended to the end of 2014. This is a standard open-pit, truck-and-loader operation, similar to Veladero. Also in Peru is the Lagunas Norte mine, located on the Alto Chicama property in north-central Peru and 175 kilometers north of Pierina. The property lies on the western flank of the Peruvian Andes at an elevation of 4,200 meters above sea level. The open pit mine began operations in the second quarter of 2005, ahead of schedule, and involved an investment in construction of $340 million. In 2011, Lagunas Norte produced 763,000 ounces of gold at an attractive total cash

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Barrick South America

The Pierina mine is located in the Andean Cordillera

â&#x20AC;&#x153;Barrick is guided by a vision to lead the industry in finding, acquiring, developing and producing quality reserves in a safe and socially responsible mannerâ&#x20AC;? cost of $269 per ounce, and had proven and probable reserves of 6.2 million ounces of gold at 31 December 2011. In all its operations in South America, Barrick is guided by a vision to lead the industry in finding, acquiring, developing and producing quality reserves in a safe, profitable and socially responsible manner. The company wants to see the regionâ&#x20AC;&#x2122;s natural resources play a key role in supporting longterm sustainable economic development and facilitating this process is a corporate priority.

Barrick is already a signatory to a number of voluntary codes and initiatives that address a range of economic, social and environmental issues. These include the Carbon Disclosure Project, the International Cyanide Management Code, Transparency International (Canada) and the Voluntary Principles on Security and Human Rights. The company has also been an active member of the UN Global Compact (UNGC) since 2005. This is an initiative which directly involves business in tackling some of the

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“Although its primary focus is on gold, Barrick also has significant interests in copper in South America”

Jamie C. Sokalsky President & Chief Executive Officer

The Pascua-Lama project zone

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Jamie C. Sokalsky was appointed President and Chief Executive Officer of Barrick Gold Corporation on June 5, 2012. He is also a member of the company’s Board of Directors. Mr. Sokalsky joined Barrick as Vice President and Treasurer, rising to Senior Vice President and Chief Financial Of ficer in 1999, and Executive Vice President and CFO in 2004, leading Treasury, Tax, Controllership and Financial Reporting, Internal Audit, Investor Relations and I n fo r m a ti o n Technology.

Barrick South America

Lagunas Norte is located on the Alto Chicama

major social and environmental challenges that arise from globalization. Barrickâ&#x20AC;&#x2122;s achievements were publicly acknowledged yet again in 2012 when it was ranked as a global leader in corporate social responsibility for the fifth consecutive year by the Dow Jones Sustainability World Index. The DJSI World Index independently evaluates 2,500 companies using rigorous criteria in the areas of corporate, economic, environmental, and social performance to identify the top 10 per cent of performers. Although its primary focus is on gold, Barrick also has significant interests in copper in South America. The Atacama desert has some of the largest porphyry copper deposits ever found, a geological

legacy that has made Chile and Peru the first and second largest exporters of copper in the world. In 2011, Barrickâ&#x20AC;&#x2122;s ZaldĂvar copper mine in Chile produced 292 million pounds of copper at a total cash cost of $1.50 per pound. The proven and probable mineral reserves at 31 December 2011 were 6.6 billion pounds.

Barrick South America

(56 2) 340 2022 info@barrick.com @minerabarrick www.barricksudamerica.com

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A mountain of potential Copper Mountain Mining Corporation Copper Mountain Mining Corporation is harnessing the vast resources of the Copper Mountain mine in order to become Canadaâ&#x20AC;&#x2122;s newest mid-tier copper producer words by

Will Daynes

research by

Jeff Abbott

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Ore hauling trucks in a row

Canadian based, high growth mining company, Copper Mountain Mining Corporationâ&#x20AC;&#x2122;s focus is directed towards adding value through a combination of successful exploration, project development, efficient operations, and opportunistic acquisitions. Furthermore, the maintaining of a low risk profile through project diversification, astute financial management and operating in secure jurisdictions are key priorities for Copper Mountainâ&#x20AC;&#x2122;s Management team. The companyâ&#x20AC;&#x2122;s flagship asset is the 75

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percent owned Copper Mountain mine, in which Mitsubishi Materials Corporation owns the remaining 25 percent as part of a strategic alliance between the two parties. Located close to the town of Princeton in southern British Columbia, the mine exists within an area blessed with well-developed infrastructure. This has made the property easily accessible via a combination of highways and paved roads. The mine also falls within close proximity to the port of Vancouver, which provides service for the shipment of

Copper Mountain Mining Corporation

â&#x20AC;&#x153;The Copper Mountain mine commenced production during the summer of 2011 and has since gone on to expand its operations in rapid fashionâ&#x20AC;?

copper concentrates, and is also little more than a 20 minute drive away from several local communities that provide goods, services and personnel. The Copper Mountain mine commenced production during the summer of 2011 and has since gone on to expand its operations in rapid fashion. The site encompasses some 18,000 acres and boasts a resource of approximately five billion pounds of copper and remains open laterally and at depth. Needless to say then, that the Copper Mountain mine

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Copper Mountain Mining Corporation

possesses significant exploration potential that the company plans to explore over the coming years. The development concept behind the mine is a fairly straightforward one. The company is essentially combining three existing open pits into what will ultimately become one larger super pit. Across the mine site the company is utilising a brand new mobile mining fleet that consists of two Komatsu PC 8000 hydraulic shovels, thirteen 240 ton Komatsu 830E haul trucks, one Komatsu WA 1200 loader, two PV271 Atlas Copco rotary drills, one PV351 Atlas Copco rotary drill, and a fleet of support equipment. In addition, the mine has possesses an Ex 5500 Hitachi hydraulic shovel, five 260 ton haul trucks, and a PV 351 drill. The mine utilises a conventional crushing, grinding, and flotation system in order to produce copper concentrates with gold and silver credits. The mine processing plan focuses on processing the higher grade

Construction of one of two new 24 foot diameter ball mills

Petro Canada Lubricants Extracting Success: Petro-Canada and Copper Mountain Mine Partnership When The Copper Mountain Mine commenced production in the summer of 2011, it purchased over $100 million worth of new mining equipment consisting of thirteen 240 and five 260 ton haul trucks, 3 hydraulic shovels, the world’s largest mechanical loader as well as a number of other support machines – which implies a tremendous amount of attention must go into all aspects of operations, especially the lubricant considerations for each and every machine. Choosing the Right Lubricant Supplier Copper Mountain presented unique challenges to potential lubricant suppliers including: processing 35,000 TPD through the mill and mining 160,000 tonnes of rock a day, enduring rough, muddy and extreme weather conditions, considering different lubricant requirements for its variety of equipment,

makes and models, and the need to have all of their operations running smoothly and properly on one lubricant supplier. “The one thing that mattered most was that suppliers actually did what they said they would do – that’s what’s really important,” explains Tom Blake, Mine Maintenance Superintendent, Copper Mountain Mine. Petro-Canada Lubricants surpassed the competition with their experience, expertise and proven products to become an integral part of the preparation process. They were involved in designing the lube systems, implementing procedures, and selecting the products that would provide the best results. At Petro-Canada Lubricants, we are proud to partner with industry leaders like Copper Mountain, who put Canada on the map for world class mining. Congratulations on all of your accomplishments to date and best wishes for continued success. www.lubricants.petro-canada.ca

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Transportation and Logistics Solutions for the Road Ahead

Products transported, handled and value added services include: Mining Concentrates, Fibre, Building Materials, Steel Products, Liquids, Bulk Products, Biosolids, Over Dimensional, Heavy Haul, Containers, Logistics and Consulting.

T: 250-374-3831 | E: rpedersen@arrow.ca | www.arrow.ca

Copper Mountain Mining Corporation

ore in the first twelve years, with lower grade material being sent to stockpiles for blending and processing later in the mine’s life. The facility is designed to operate 24 hours per day, 365 days per year with a 92 percent mechanical availability including pre–scheduled downtime for equipment maintenance. Concentrates are exported via the port of Vancouver to Mitsubishi smelters in Japan for treatment and sale. In addition to the resources it has already mined and continues to bring to the surface, the company is well aware of the significant exploration upside that still exists on the Copper Mountain project. The area surrounding the mine has played host to successful exploration programmes for the best part of 100 years now and the company is steadfast in its belief that this tradition will remain in place for many years to come.

Arrow Transportation Systems Arrow Transportation Systems has been a transportation partner to the mining industry in Canada and abroad for over 50 years and in the transportation business for almost 100. We are an industry leader in truck transportation, materials handling, logistics management, consulting and technology management. We are known as an organization that can provide comprehensive, innovative solutions to customers at the least total long-term cost. Jim O’Rourke is an industry leader, an innovator and a driving force in the international mining industry. We are proud of our long association with Jim and our role as the trucking transportation partner for Copper Mountain. www.arrow.ca

Lower Bowl Frame of secondary crusher in Kamloops BC awaiting to be transported

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Chemistry Delivered.â&#x201E;˘

Comprehensive selection of core and specialty chemicals. Unparalleled scale and connectivity across geographies. Technical insight for every stage fo mine development. +1855 888 8648 www.univar.com ÂŠ 2012. Univar Inc. All rights reserved. Univar, the hexagon, and the Univar logo are registered trademarks of Univar Inc.

Copper Mountain Mining Corporation

univar Univar is the distribution partner that is transforming the way chemicals are bought, sold and managed in the mining industry. We supply a comprehensive selection of core and specialty chemicals for every stage of mine development, from exploration and extraction to reclamation. The breadth of our product line is unsurpassed, including absorbents and adsorbents, acids and acid cleaners, coagulants, collectors, frothers, mining and ore digging aids, surfactants, water treatment and much more. Our extensive distribution network, global reach and unparalleled logistical expertise provide our customers a consistent and reliable source of supply. In addition to our vast product offering, we provide important value-added services for our customers and suppliers. www.univar.com

The aim of any future exploration programmes will be to define additional resources from numerous untested targets previously identified by a deep penetration Titan 24 survey that was conducted in late 2007. Interpretation of the geophysical properties is consistent with the geological model of hydrothermal alteration and mineralized zones within an alkali porphyry setting. From day one the Board of Directors and management of Copper Mountain have collectively held the belief that maintaining the highest standards of corporate governance is a critical factor when it comes to the effective operation of the mine and the business as a whole. Together they state that the company should always be managed in an ethical way and, in making this a reality, have in place a Code of Business Conduct and Ethics which all its employees, executives and shareholders uphold.

The lower main frame being lifted into position using a specialized crane

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PRECIOUS RESOURCE DISCOVERED Click here to visit our dedicated homepage for the mining community

www.bus-ex.com/mining

The Gisborne Group is pleased to continue our relationship wih Copper Mountain as the General Works Contractor for the construction and installation of the secondary crusher.

Phone: 604-520-7300 Fax: 604-522-0425 www.gisborne.com • CONCRETE • FIRE PROTECTION • STRUCTURAL ERECTION • INSTRUMENTATION • MECHANICAL • ELECTRICAL • PIPING • CONTROLS

CONTINUOUS IMPROVEMENT - INTEGRITY - RESPECT - CLIENT FOCUSED

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Perhaps the two most important areas covered by the code are health and safety, and environment and sustainability. As is the case with all professional mining operations, Copper Mountain strives to achieve the highest standards of mine safety and healthy across all of its business activities, a commitment the binds together the company’s Health and Safety Policy. The safety and health of all employees and contractors is of the utmost priority to Copper Mountain’s management. As such training programs, safe work procedures, site housekeeping and operational standards are enforced at Copper Mountain, which together are designed to ensure that all work is undertaken in a safe manner with minimal risk to employees and equipment. Much in the same way that the company recognises the importance of providing a safe working environment, Copper

Copper Mountain Mining Corporation

Panoramic view of the interior of the process plant.

â&#x20AC;&#x153;The company ensures that it incorporates environmental management into all of its business activitiesâ&#x20AC;? Mountain recognises that mining in itself is temporary land use activity. Therefore the company ensures that it incorporates environmental management into all of its business activities. It realises that managing environmental responsibilities is an integral component in ensuring that the sustainability of its current and future operations is maintained.

Additionally, Copper Mountain is committed to returning the land to an overall improved condition after mining has ceased while preserving the heritage value of each site. As part of this commitment, consultation with community groups is carried out during the development stage of rehabilitation plans to ensure that the needs of all stakeholders are taken into account. This is reflected within the companyâ&#x20AC;&#x2122;s Environmental Policy, which sets out what it hopes will become the legacy of the site long after it has ceased production. Copper Mountain Mining Corporation

604.682.2992 jim@CuMtn.com www.cumtn.com

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Bringing ore to the surface Pyh채salmi Mine Oy The Pyh채salmi mine is one of the deepest and oldest mines in Europe and has been producing vast amounts of copper and zinc for over 50 years. As Managing Director, Kimmo Luukkonen explains, even as it approaches the end of its life the mine has much still to give words by

Will Daynes

research by

Abi Abagun

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View of the Pyhäsalmi Mine Oy from the east

ocated in the town of Pyhäjärvi in the south of Oulu province, in central Finland, the Pyhäsalmi mine is an underground copper and zinc mine, owned by Canadian mining corporation First Quantum Minerals. With a depth measuring 1,444 metres, or 4,738 feet, it is the deepest metal mine in Europe and among the continents oldest. It origins date back to 1958, when a local farmer came across gossan ore during a well construction. A sample of this ore was soon

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delivered to Outokumpu Corporation, which, following analysis of the sample ordered a more thorough geological survey to be conducted on the area. Said survey revealed a rich volcanogenic massive sulphide (VMS) deposit rich in copper and zinc, and come 1959 the decision was taken to open up a new mine at the site of the ore discovery. The Pyhäsalmi mine opened on 1 March 1962. For the first five years it existed as an open cast pit, before underground mining operations commenced in 1967. Outokumpu

Pyhäsalmi Mine Oy

was responsible for designing an underground development plan for the mine and in 2001 completed the construction of a 1,450 metre deep automated hoisting shaft. A year later the mine was acquired by Inmet Mining, who continued forward with the underground development plan. Fast forward to 2013 and the company found itself being acquired by First Quantum Minerals as part of its purchase of the Inmet Mining group. “Throughout the history of operations here more than 50 million tonnes of ore has been

successfully mined,” states Managing Director, Kimmo Luukkonen. “Based on the most up to date information available we estimated that we have approximately five years of mine life ahead of us which will take our mining operations into 2019. During this time we anticipate an additional seven million tonnes of ore will be mined, taking the recovered ore from the deposit to around 60 million tonnes in total.” Pyhäsalmi Mine Oy, a fully owned subsidiary of First Quantum Minerals, charged with operating the mine, today uses non-entry,

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PRECIOUS RESOURCE DISCOVERED Click here to visit our dedicated homepage for the mining community

www.bus-ex.com/mining

Nordkalk and Pyhäsalmi Mine have co-operated for a number of decades. Nordkalk provides Pyhäsalmi with special quicklime, matched to the requirements of existing equipment. Lime is used in: • underground mine filling • ore dressing to adjust pH • water treatment to neutralize and reduce metal content Nordkalk is the leading producer of high quality limestone-based products in Northern Europe. The products are used in the metals and mining, paper, and building materials industries as well as in environmental care and agriculture.

www.nordkalk.com

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bulk open-stope mining methods in a primarysecondary sequence. On average, stope size varies from 50,000 tonnes for narrow primary stopes to over 100,000 tonnes for wider secondary stopes. Meanwhile, milling at the mine involves crushing, three-stage grinding, conventional flotation using three separate circuits, and water removal to produce copper, zinc and pyrite concentrates. “Looking back over the history of the mine one can clearly see that it is a development that has always prospered from the use of the latest technologies, and best practices and processes,” Luukkonen continues. “For its part, Outokumpu has always been recognised for employing cutting-edge technologies, many of which originated from its own in-house research and development division, which was a rare thing to have during the 1970s and 80s. What we have done since taking over operations at the mine is continue to utilise

Pyhäsalmi Mine Oy

Mill control room

“Throughout the history of operations here more than 50 million tonnes of ore has been successfully mined”

new techniques and tools to get the most from the mine, an approach which extends to every area of operation. For instance, years ago the mine employed what was the first Sandvik cable bolter. Today we continue to strengthen our partnership with suppliers and contractors like Sandvik in order to retain our leading position in areas such as automated production drilling and automated loading.” During 2013, the mine was responsible for producing 14,900 tonnes of copper at an average grade of 1.1 percent, and 21,700 tonnes of zinc at an average grade of 1.9 percent. “Our

figures for last year were very much in line with what we would consider normal for the mine,” Luukkonen says. “Annual tonnage figures have remained fairly stable for the better part of decade now, averaging some 1.4 million tonnes in total per year. Of course, when it comes down to it, you can only mine what you have in front of you, however our processes and methods of operating have always been strong and we feel this is reflected in our results.” In the 52 years that the mine has been in operation it has been has a massive impact on the region in which it operates, an impact

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Did you know? 1,444 metres The depth of the Pyhäsalmi mine 14,900 tonnes Of copper produced by the mine in 2013 21,700 tonnes Of zinc produced by the mine in 2013 1.1% Average grade of copper Mine surveyor

1.9% Average grade of zinc

“Our job from here on out is to utilise the time we have left here to get the most out of an incredible asset which has already delivered so much”

driven by the fact that when it comes to the town of Pyhäjärvi’s tax income alone, the mine is responsible for contributing one third through the payment of corporate taxes and other associated costs. Meanwhile, it is estimated that another third of the municipality’s tax income comes as a result of indirect effects of the mine. This of course poses a question as to how the municipality will adapt when operations at the Pyhäsalmi mine does come to an end.

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6 years Current estimated mine life 210 Number of employees

Understandably, the end of the mine’s life is an event that the operators are well prepared for, perhaps all the more so as the mine faced a similar scenario in the mid1990s when, faced with only a few years of operations remaining, a new ore body below one kilometre in depth was discovered. “When it comes to the end of mining operations here, we have to consider the fact that what we have here is an extraordinary asset which is not only among the deepest

Pyhäsalmi Mine Oy

Workers consult manual

mines in Europe, but also one of the only ones to possess access ramps that all vehicles can use to reach the very bottom of the shaft,” Luukkonen explains. The unique size of the asset and its logistical strengths has already seen it earmarked as the potential base for a number of exciting future ventures. These include being a candidate for future pan-European particle physics research projects. Another potential future use of the mine could be to support pumped-storage hydroelectricity projects. “While talk of what the future may hold for the mine site is interesting, it is equally as important to consider the future of our skilled, experienced and dedicated work force,” Luukkonen enthuses. “They are the individuals who have contributed most to the success of the mine and as such we are hard at work developing a retention plan. Although we have no doubt that there will be no shortage of opportunities offer

to our employees once the mine ceases operations, we want to do all we can to recognise their contributions and retain their skills and knowledge.” Turning back to today and the mine’s outlook for 2014 looks bright, what with production levels of copper, zinc and pyrite all looking to remain in line with previous years. “We are certainly on the right path when it comes to this year,” Luukkonen concludes. “Our job from here on out is utilise the time we have left here to get the most out of an incredible asset which has already delivered so much.”

Pyhäsalmi Mine Oy

+1 416 361 6400 info@fqml.com www.first-quantum.com

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Surfing the bo of the minin

IOS Service GĂŠoscientifiques Inc is a geologic the Canadian mineral exploration industry contracting field work and opera words by

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John Oâ&#x20AC;&#x2122;Hanlon

ooms and busts ng industry

cal consulting firm with a difference: Serving since 1992, it integrates consulting services, ating a mineralogical laboratory research by

Stuart Platt BE Monthly [ May 2014 ]

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Drill core logging

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IOS

ince founding IOS 22 years ago at Chicoutimi in Québec, Réjean Girard has seen no fewer than four recessions and it’s an achievement in itself that, as a service provider to the notoriously cyclic mining industry, the firm has managed to grow through each of them. It has forged a reputation well beyond Québec and Canada as an efficient and innovative operator. Canada has a reputation for leadership in mining investment, as evidenced by the success of the TSX in listing companies. However the mining industry is very conservative, and nowhere more so than in Canada itself. Girard notes, and regrets, the fact that investment in technology has been allowed to lag behind field operations. “Exploration is risky and expensive, and to

boom and bust and their consequent cost to the industry. There’s equally no arguing with the fundamental demographics. To fully industrialise the BRIC nations will take more mineral resources than mankind has already produced. With 30 million people in China moving every year off the land and into the cities, that country alone will need to build the equivalent of Canada’s infrastructure every year! They and the mining industry are being done no favours – investors need to take a longer view and the industry needs to iron out its peaks and troughs. It could do worse than look at the example of IOS. Plan for the boom when you are in the doldrums, and for the bust when things are good. And be ready; the boom is coming! In

“This is an industry driven either by greed or passion – two behaviours that are very difficult to manage!” give it a better chance of success we need to constantly renew our toolbox,” he says. “But minimal incentives are made available for doing that.” Drilling cost are humongous – up to 60 percent of all investments – and improved targeting approaches are a must. We have too much tolerance of poor planning, he believes. Marginal projects shall be abandoned earlier, saving large sums for viable ventures. “Overall exploration costs are too high compared to the revenue of the industry. It is a structural problem.” This he thinks is due to investors’ tendency to consider exploration as a goal, not as a means. “This is an industry driven either by greed or passion – two behaviours that are very difficult to manage!” Whatever the cause, there’s no arguing with the fact of

a downturn, budgets are slashed, research gets hit and innovation dries up, but that is just the time when the seed corn should take priority because the current trough has to end soon – he thinks the upturn will be established by the end of this year. The mines will not be ready though – during 2012, some $800 million was invested in exploration in Québec alone, in 2013 less than a twelfth of that. Is this any way to run a business as essential as mining, he asks. No wonder so many companies go to the wall – but not IOS! “It needs a lot of experience to level the field. In the good times we act like squirrels hiding nuts everywhere! Then when the lean times come, we have resources to back our human resources onto scientific research and development processes. That allows them to carry on working when there

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Rock sampling tundra

are no clients, and the company to conceive and develop new product to be ready when the next boom comes.” Something rather remarkable came out of the latest recession – something that looks like an engineering project, despite the fact that IOS is not an engineering firm. Mining in Canada (and right around the tundra belt) is made difficult, slow and expensive by the terrain and the climate. Canadian swamps are endless! The favoured way to get about is by helicopter, which doubles the exploration costs. So IOS got together with its neighbour L’Équipe Fabconcept to develop an all-terrain vehicle (ATV) capable to partly replace helicopters and drastically reduce operating costs. The prototype and the first production Kaskoo-X04 were successfully tested over a variety of unimaginable terrains. Girard believes this vehicle will be outperforming during the harsh Canadian winter, when access roads are closed and the lakes frozen. “This incredible ATV has definitely proved that it can deliver the job.” The Kaskoo-X04’s innovative technology makes it the best all-terrain vehicle on the market today, according to the manufacturer. It’s quite fast, reaching up to 40 kph due to its superior suspension and a comfortable passenger compartment. It floats despite its 1.5 tons cargo; it crawls effortlessly in deep mud and snow – Canada’s lakes and swamps are no obstacle. Fabconcept needed IOS to test the machine and make sure it fits the market requirements. Everyone in Canada knows IOS and that its evaluation of the savings over helicopter usage can be

“We can get a camp running with a single generator burning one drum of fuel a day instead of 20 or so a week”

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IOS

Drilling in Northern Québec

“A boom is the wrong time to invest because everything costs more, and staff become available during the lean time” depended on. L’Équipe Fabconcept is now tooling up to start production – in small numbers at first but ready to meet demand from Canada and beyond. It’s simple, cost reduction relies upon innovation. The next big thing from IOS neatly complements the Kaskoo-X04. Another huge cost up-country is heating the camps. Heating fuel easily costs $1,200 a drum in the Canadian north, as it needs to be brought in by seaplane or helicopter. IOS developed a geothermal system for the camps that works on the heat differential between the lakes and the atmosphere. “We can get a camp running with a single generator burning one drum of fuel a day instead of 20 or so a week.” The system is modular, can be installed in two days, and provides air conditioning in the

summer and heating in the Canadian winter. “That is the kind of technology that keeps us ahead of the competition. If you do not have it, you are left to compete on price alone!” Remember the analogy of the squirrels? Being canny with its ‘nuts’ in good times has helped IOS through the rough. Rather than keep large sums in the operation attracting the taxman, part of surplus funds are invested in a foundation set up with local universities. This allows it to take staff through higher degrees and funds the research. “I simply set money aside to train the staff. Anyway a boom is the wrong time to invest because everything costs more, and staff become available during the lean time.” As an example, a research project conducted with Sherbrooke University, is

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placing IOS well ahead of the field. The university has no mining department, he explains, but is reputed in environmental engineering – by tapping into this expertise the company has developed a new way to analyse soil samples for their metal in order to trace back the origins of the metals. The method uses an automated electron microscope of the QEMSCAN (quantitative evaluation of minerals by scanning electron microscope) type, which IOS purchased last year at a cost of $1 million. “If you want to know where the metals are coming from, you

have to know how they were precipitated and that is an exercise nobody did before, at least on a commercial basis. We are at the cutting edge of geochemistry here.” A geochemical survey can easily cost $500,000, he says, and lead to further campaigns costing millions. There is a huge amount of money to be saved by better understanding the metal dispersion processes. “Metal assemblages are dissociated in the secondary environment, so you cannot rely on what you see in a mineral deposit to extrapolate their signal. The relation of uranium and thorium is notorious,

“If you want to know where the metals are coming from, you have to know how they were precipitated and that is an exercise nobody did before”

Kaskoo in the snow

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IOS

Valerie operating the electron microscope

yet, even the big laboratory. That and using the association seen Did you know? is why our mineralogy service in deposit at the exploration is still busy after the worst level can be misleading, recession for years!” thus money wasting.” 1992 Innovation also drives Another technique that the Year IOS was IOS’s business approach. 90 company developed seven founded percent of IOS’s work is in years ago with an investment Canada, though even in its of $250,000 perhaps explains $1 million home province 40 percent is it better than any other. Heavy Invested by IOS for outside companies. “We minerals are separated from in its QEMSCAN open the door for external light minerals by using a dense electron companies to invest in Québec, liquor to ‘float’ off the latter. The microscope which has a mining-friendly medium used has traditionally reputation,” he says, pointing been organic-halogen liquor, a out that Québec is not merely carcinogenic mixture of bromine French-speaking but the only province to be and iodine with organics. IOS developed regulated under French-legacy civil law. The and commercialised an alternative based on mining law is quite unique in North America, tungsten salt. It is safer, cheaper, more flexible and unfamiliar to outside companies. and faster, and proved so successful that it “We’ve helped a lot of small companies to paid back its development costs in a year, at come in. We know the rules and how the the same time securing the future of 15 lab systems work as well as being their guide jobs. “Part of it is a top secret process and to the best service providers or community no competitor has been able to reproduce it

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“Our work goes beyond geotechnology into logistical support for projects, administrative support – we even help companies to do their fundraising on the stock exchange”

Lucie and her microscope

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IOS

Sampling in Taiga

relations. We offer turnkey services based upon integrity”. Its francophony is also a help when IOS is working in countries like Burkina Faso, Cote D’Ivoire, Mauritania or Congo, where trust for a Canadian partner is strong – after all they share a common colonial inheritance! A good example of this work is the geological lab that IOS helped Mauritania’s Société Nationale Industrielle et Minière (SNIM) to set up. An iron ore miner, SNIM wanted to develop diamond production. IOS personnel established the laboratory, and have overseen management while at the same time training Mauritanian staff to run it. In another current project in Sudan, IOS geologists work with a local company training local crews. In every case IOS is teaching not just the techniques of exploration but about how it relates to the business as a whole, financing, logistics and how the mining business works. “Our work goes beyond geotechnology into logistical support

for projects, administrative support – we even help companies to do their fundraising on the stock exchange.” Broadening their expertise, he believes, helps his clients to manage the cycles for themselves. All of this accounts for IOS having a healthy order book in the final days of a deep recession. “The industry will bounce back next year and we have to be ready,” says Réjean Girard. “When the bubble bursts, too many companies panic and lay people off. This is not the time to do that: rather get everything in good order and the machinery oiled ready for the next boom!”

IOS

(418) 698-4498 ios@iosgeo.com www.iosgeo.com

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Rainstorm D

Taking the professi

The last 18 months has been an exciting time for Rainst manager, Mason Trouchet explains, the next 18 could w words by

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Will Daynes

research

Dust Control

essional approach

torm Dust Control and, as technical sales and marketing well be the best yet in the companyâ&#x20AC;&#x2122;s 30 plus year history

research by

James Boyle BE Monthly [ May 2014 ]

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Rainstorm bucket at Jandakot

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Rainstorm Dust Control

think it’s safe to say that business has changed dramatically over the last 18 months,” states Rainstorm Dust Control’s technical sales and marketing manager, Mason Trouchet, when I ask him what life has been like for the Australian company since we last featured them in September 2012. Headquartered in Maddington, the company, as you may have already gathered, specialises in dust control. Since 1983, Rainstorm has successfully developed and fine-tuned a suite of products designed to stop the large volume of dust created during the various stages of a mining operation from becoming airborne. Whether used on roads, stockpiles, railways, plants or warehouses, its locally-manufactured dust suppression

“

a half have also come as a result of greater use of connotative data and technologies that are able to quantify the performance of dust suppression products against costs. This has resulted in businesses looking at dust control from a business case point of view, something that was less prevalent in years gone by. “Dust control covers a number of areas, including roads, transportation, open areas and materials handling,” Trouchet explains. “What the large mining companies are realising now is that there is little point in tackling just one of these areas independently, after all dust you pick off the roads will ultimately just land on open areas and vice versa. So what they are doing now is identifying who can provide

“The change in business has come as a result of a number of factors, not least of all the mining booms experienced in key markets” products have proven time and again to increase efficiency, reduce hazards and make processes simpler, cleaner and safer. “The change in business has come as a result of a number of factors, not least of all the mining booms experienced in key markets including Australia, Colombia, Mongolia and South America, which have resulted in increases in production and thus increases in dust generation,” Trouchet continues. “Meanwhile, attitudes towards environmental responsibility and water conservation have only grown stronger, with the mining community acknowledging that it can’t simply bulldoze through villages and areas and leave them choking on dust.” Changes within the company and the industry as a whole, over the last year and

a package service that deals with all the aforementioned areas where dust generates and who can do so at the best cost.” Roads remain the biggest area of interest when it comes to dust control, with studies highlighting that more than 50 percent of all dust generated within a specific project originates from roads and vehicle traffic movements. “Vehicle traffic volumes, particularly in the form of trucks increase during boom periods,” Trouchet points out. “What this means is we have to look at ways to keep the roads pliable, making them moulded rather than stiff and rigid. With increases in road usage customers are also looking for dust control products that are much more performance orientated than ever before. This means applying a solution

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“Recent studies have cast light on the loss of product and amount of dust generated from the use of rail cars by the coal and iron ore sectors”

that stays effective for a matter of months rather than days or weeks.” The other two main issues of importance come in the form of open areas and materials handling. In the former Rainstorm carries out what it calls veneering, where it sprays

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a thin coat of solution over stockpiles and open areas. “This process of veneering has been practised for many years, however the interesting development to emerge from this has been the idea of rail car veneering,” Trouchet says. “Recent studies

Rainstorm Dust Control

Gluon treated (left) and untreated (right) stockpile

have cast light on the loss of product and amount of dust generated from the use of rail cars by the coal and iron ore sectors, a loss that more often than not exceeds the cost of veneering itself. What we have taken to doing in response is start to veneer the rail cars themselves, thus creating a whole new business positive example of how our technology can not only save our customers cost but also create environmental benefits for the wider community.” When it comes to the materials handling chain, the biggest topic in recent times for the company has been the issue of dust extension moisture, where moisture is

mixed into an ore body to counteract its dusty nature. What Rainstorm has found is that in many instances companies have been using large amounts of water to get the correct moisture content, an action that in itself can cause problems that direct impact upon the productivity of plants, crushing circuits or throughputs. “By adding certain additives into that water stream to make the material in question less dusty with lower moisture content we also found that we were seeing improvements in throughput and flow, and this in turn was improving things in terms of money gain,” Trouchet enthuses. “So where

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Did you know? The three strengths of Rainstorm 1. We only use environmentally friendly products.

Untreated ore - a bad dust day

“We are reaching the point where what we have been preaching for the better part of 30 years is now being qualified”

we were trying to manage dust in the first instance, that was just a cost plus, but the impact we were having on input and flow meant that our customers could in turn increase the capacity of their plants and that has a direct dollar relationship, which meant that these materials created a cost benefit that they didn’t foresee in the first instance.” The fundamental task of dust control is one that in itself carries environmental benefits, however as Trouchet goes on

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2. We consider the client’s total end cost, and ensure that we, not the customer bear the onus for a successful outcome to the customer’s satisfaction. We provide total solutions. Rainstorm has always chosen to provide all equipment and application services along with the best products so can gladly shoulder the onus for making things work. In other words, we don’t blame the customer for “not putting it out right”. 3. We are continuously striving to improve equipment, methods, products and training.

to tell me, Rainstorm possesses a much more comprehensive attitude towards responsibility and sustainability than just that. “We have always taken a view towards looking at how we can take the by-products or waste materials of other industries and utilise them as a way of supressing dust.” While boom periods in mining are a blessing to all involved in the industry, it is important to remember that the issue of dust control is constant. Inevitably this means

Rainstorm Dust Control

Veneering in process

that regardless of market conditions there will always be a demand for the services that Rainstorm provides. Even with that in mind the company still faces a need to evolve and adapt to changes in the marketplace, something that Trouchet appears well aware of. “When it comes to taking the company forward there are several on-going changes that will determine how we grow and develop. The first is the way our customers are increasingly putting their site-wide dust control contracts out to tender. This is a big shift in approach and is one being seen mostly amongst the larger players in the market. Winning these long-term contracts is of great importance as they allow us to embed our crews and equipment with these customers, and service their needs for extended periods of time.” The other big change is coming from the development of various technologies that are able to provide detailed breakdowns of where

surfaces are being treated, how much product is being used and what the cost benefits of that usage are. “In the case of road treatment, the use of 2D and 3D models is giving us a better detailed cost and performance per square metre overview than ever before,” Trouchet concludes. “This gives us clear data that we can present to potential customers that has been shown to encourage their uptake of our products and services. This is very exciting for us because it essentially means that we are reaching the point where what we have been preaching for the better part of 30 years is now being qualified.”

Rainstorm Dust Control

08 9452 0235 info@rainstorm.com.au www.rainstorm.com.au

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Staatsolie

Bringing value

back home

The national oil company of Suriname is facing a very promising future, with enough hydrocarbon reserves to keep it self sufficient for many years – at the same time it is investing in sustainable energy alternatives words by

John O’Hanlon

 research by

David Brogan

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he Republic of Suriname, with its capital city Paramaribo, is located just north of the Amazon delta on the northeast coast of South America. It is bordered to the north by the Atlantic Ocean, to the west by Guyana, to the east by French Guiana, and to the south by Brazil. This is a country with a rich mining history as one of the major bauxite and alumina producers in the world, however it also has oil, both onshore and offshore. The systematic search for hydrocarbons began in the early 1960s but petroleum development took a leap after 1980 with the set up of Staatsolie, and production sharing service contract models were introduced for the participation of private oil companies in petroleum activities. All the shares in Staatsolie Maatschappij Suriname NV are held by the government of Suriname. It has two divisions, one that controls the licensing of offshore blocks on behalf of the government to interested companies that include Tullow Oil, Kosmos, Chevron, Petronas and Apache. The other side of the business Staatsolie Production, is much larger and has the job of running the company’s many upstream and downstream projects, including its most ambitious ever, the refinery expansion project (REP) that is nearing completion and will dramatically affect the economy of the country. Staatsolie already accounts for some 25 percent of national revenues through the taxes it pays and the 50 percent of profits that it returns in the form of annual dividend. It is a profitable company, and the other 50 percent is reinvested.

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Aerial view of the refinery expansion project

2014 is going to see a step change for Staatsolie, says Rudolf Elias, Director of Refinery & Marketing and Project Director of the REP. However the company has developed very successfully to date, he explains. “We started with the production of heavy crude that we found in a very small onshore oilfield that was of little commercial interest though it was low sulphur crude. We managed it ourselves, growing from around 300 barrels per day (bpd) gradually building up to more than 17,000 bpd that we extract today.” This equates to some six million barrels per annum (mbpa), an amount more

Staatsolie

“Once the new refinery is operating, we will be able to produce 100 percent of the country’s diesel requirement, all of the bitumen, and 70 percent of the gasoline we need”

or less equivalent to the annual domestic consumption of Suriname. However the crude oil is mainly exported, since the only refining capacity in the country till now has been limited to producing around 7,000 bpd of fuel oil, plus some bitumen that it exports to neighbouring countries. The fuel oil and the exported crude generate handsome profits for Staatsolie. Heavy fuel oil (HFO) is sold to the boats that call at Paramaribo and is in demand for electricity generation thanks to its low sulphur content, and because it is derived from shallow sand deposits it is very cheap to produce coming

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IREM S.p.A. & Sices Group

Positive energy The two Italian Companies IREM S.p.A. and SICES Group have been cooperating for many years to deliver complete and efficient services in the design, planning, construction and maintenance of every type of industrial plant. Their mechanical activities include: mechanical erection, skid, packages and modules erection, heavy lifting management, piping prefabrication, supports and steelworks fabrication, ordinary and extraordinary maintenance services and turn-around services. Expertise, flexibility, a solid investment in human and technical resources, plus an ability to work cooperatively, make IREM and SICES a reliable partner, with the necessary skills guaranteeing that Clients receive a top quality service.

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The two Companies are committed to sustainable and responsible operations management and to providing and maintaining a healthy, safe and secure working environment. www.iremspa.it www.sicesgroup.com

Staatsolie

The project was started with the first pile driven on 21 February 2012

â&#x20AC;&#x153;I have had 250 people in training for over a year and they will manage the start up alongside Saipemâ&#x20AC;?

in at under $5 per barrel, despite the fact that to produce 17,000 bpd Staatsolie has to operate no fewer than 1,400 separate wells. Nevertheless this oil sells at world oil prices, and in 2012 Staatsolie broke through the $1 billion turnover barrier for the first time. The priority for some time has been to add value to Surinameâ&#x20AC;&#x2122;s crude, rather than exporting the bulk of it, and produce the premium diesel and gasoline needed within the country rather than importing refined product. It took some ten years to finalise the

design for the new $900 million Tout Lui Faut refinery 20 kilometres south of Paramaribo, in partnership with CB&I Lummus of the Hague. The job was then put out to tender and a contract awarded in July 2011 to the Italian O&G contractor Saipem. After ten months of engineering activities the agreement was converted to a full engineering, procurement, fabrication and construction (EPC) contract with fabrication of the pre-assembled portion of the plant being carried out at the Saipem Arbatax fabrication yard in Italy.

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Construction has been proceeding according to plan, says Elias. “We are already 70 percent complete, and we expect the plant to be ready during September. Pre-commissioning is under way, and commissioning started in March, with the utilities coming first, followed by the various units.” A 15,000 barrels capacity vacuum tower is at the front of the process, followed by a hydrocracker that will feed into the diesel and gasoline trains, producing 8,000 bpd of the former and 3,000 bpd of the latter. “Once the new refinery is operating, we will be able to produce 100 percent of the country’s

diesel requirement, all of the bitumen, and 70 percent of the gasoline we need.” There’s also a 300 bpd sulphuric acid by-product, all of which will be exported, he adds. Once the project was started, with the first pile driven on 21 February 2012, construction went ahead very smoothly. The contractor Saipem is responsible for the commissioning and startup phase, and low sulphur diesel and gasoline, meeting EU Euro V specifications, should be coming out of the refinery by the end of this year. But running the new plant on a nine hectare area to the east of the existing refinery will make many demands

“At the moment we are flying a Cessna quite successfully but now we are being handed a 747, and that is a different animal altogether!”

Rudolf Elias, Director of Refinery & Marketing and Project Director of the REP

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Staatsolie

In December, Suriname will suddenly have its own petrol and diesel

benefit the company and the on Staatsolie. “At the moment Did you know? entire country, he stresses. Of we are flying a Cessna quite the 2,000 people working on successfully but now we are construction at least 70 percent being handed a 747, and that is 6 million bpa are local Surinamese. And with a different animal altogether!” Staatsolie’s more than 140 local companies Best in class systems are being current crude contracted to work at the site, incorporated, such as a Honeywell production there has been a significant manufac turing execution positive impact on the private system (MES) that he believes 140 sector economy too. “We want will help achieve significantly Local contractors to make a strong contribution to improved operational readiness, working on the the advancement of our society,” optimising workflows, capturing new Tout Lui says Rudolf Elias. knowledge, minimising risks, Faut refinery In December, Suriname will improving safety, and enhancing suddenly have its own petrol the performance and agility of and diesel, and there are just the entire operation. “I have had two players in the downstream market. One of 250 people in training for over a year and they these is Staatsolie itself, though a subsidiary will manage the start up alongside Saipem. called Goto (the word for gold in Surinamese These will be assisted by more than 30 very but doubtless a good name for a petrol station experienced operators I hired from all round serving English speaking customers). Goto the world to assist our people to operate runs the former service station networks of the plant after completion.” The skills that Texaco and Chevron: a competing company will be transferred in the process will greatly

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Staatsolie predict there will be enough oil to increase production to 25,000 bpd by 2022

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Staatsolie

“There is no refinery in the region making low sulphur diesel so we have a ready market in French Guyana, Martinique and Guadeloupe”

Sol Petroleum took over the Shell and Esso retail outlets and both will now receive their supply from Tout Lui Faut via a new pipeline that is being installed between the refinery and their distribution facilities. The HFO will continue to be sold to Guyana and Barbados for electricity generation. “We will also use it in our domestic energy generation,” says Elias. “We already have a 28 MW station that uses our crude, and we are expanding it to 62 MW in March 2014.” Most of the crude produced will thus either be consumed for energy generation in Suriname itself or sold to the local retail stations, though some will still be exported. “There is no refinery in the region making low sulphur diesel so we have a ready market in French Guyana, Martinique and Guadeloupe because they operate under EU regulations and require Euro spec diesel.” The old refinery will be closed for a few months once the new one is operational, and some of its units mothballed. The plan is to bring those units back into operation at a future date when greater volumes of oil come on stream. Staatsolie holds seven near-shore blocks along the coast and is confident that it will hit oil during a drilling programme starting this year. “We think we will find enough oil to increase our production to 25,000 bpd by 2022. We are doing drilling on our own account, however if we have commercial finds we will approach an experienced partner to speed up production. The offshore picture in deeper waters is vibrant, with major companies actively drilling. Four wells were drilled in these blocks

over the last ten years but five are expected to be added to this list in 2014 alone. “A lot of people expect big oil and gas finds in our waters,” says Elias. The refinery is the big story for the moment, but Staatsolie is also very keen to balance its hydrocarbon dependency with some sustainable alternatives. The most promising project is a biofuel plant that will produce ethanol from sugar cane. A successful pilot has been running since 2008 in collaboration with Brazil to test whether sugar cane can be grown successfully on old rice fields. “The sugar content and the tonnage per hectare are surprisingly high,” he says. Now 300 hectares are in preparation and an EPC contract put out for tender to supply a hybrid plant to produce ethanol, with sugar and electricity generation as by-products. Hydroelectricity and the production of energy using solar, wind and even algae is under consideration. This means that Staatsolie itself is in transformation from being a pure play fossil fuel company to being something a lot greener and more diverse – it is a vision, admits Rudolf Elias, but not one that will divert his focus on delivering the refinery that means so much to Suriname.

Staatsolie

 (597) 499649  mailstaatsolie@staatsolie.com www.staatsolie.com

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EcoEle

Power for t

By generating clean, safe and reliable energy from n of the Caribbeanâ&#x20AC;&#x2122;s lowest cost producers and a vita words by

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Will Daynes

ectrica

the future

natural gas, EcoElectrica has established itself as one al contributor to Puerto Ricoâ&#x20AC;&#x2122;s growing energy mix research by

Abi Abagun BE Monthly [ May 2014 ]

187

t was at the beginning of the 1990s that the groundwork behind the foundation of EcoElectrica was first laid. Impacted by a combination of high oil prices and new legislation designed to combat the environmental impact of the fuel, the newly elected Government of Puerto Rico embarked on a plan to diversify the country’s energy portfolio, incorporating more clean, safe and cost effective alternative energy sources in order to reduce Puerto Rico’s dependency on oil, which at the time made up 99 percent of the energy used on the island. “It was the executive director of PREPA at the time that helped facilitate the creation of a Power Purchase Agreement (PPA) contract which would come to be in place by early 1995, effectively beginning the journey of EcoElectrica,” explains Jaime Sanabria, General Manager of Finance and Administration. “Following several years, during which time financing was put in place and fuel agreements were signed, EcoElectrica’s ground-breaking ceremony was held in 1998 and two years later, in March 2000, commercial operations officially began at our power plant, followed by our LNG terminal in August 2000.” The first independent power generator in the world to integrate a cogeneration plant using natural gas with an import terminal for LNG, EcoElectrica is today the preferred

“The first independent power generator in the world to integrate a cogeneration plant using natural gas with an import terminal for LNG”

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Commercial operations officially began at our power plant in March 2000

EcoElectrica

“The time we have been in existence has been very much defined by our mutually beneficial and strong relationship with PREPA” supplier of energy to PREPA and possesses the only facility on the island with the capability to import, store, regasify and export natural gas. “The time we have been in existence has been very much defined by our mutually beneficial and strong relationship with PREPA,” Sanabria continues. “With new regulations being introduced on a regular basis by the likes of the Federal Government and the Environmental Protection Agency targeting emissions and other controls we have become an even larger part of the energy equation in Puerto Rico. In our case 99 percent of the fuel we burn is of course natural gas, therefore we should provide PREPA with a means to avoid what are very costly penalties that would be incurred from not meeting these new regulations that take effect in April 2015.” At the heart of the company’s power generating ability is its combined cycle power plant, one which operates on three generating turbines, two of which burn gas with the other being a steam turbine. Together these allow the plant to produce approximately 540 megawatts of power, a figure which equates to 15 percent of the total electricity generated in Puerto Rico. The steam generated during the process of converting LNG also helps run the plant’s water desalination facility. Here the company extracts ocean water in order to produce two

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Seen

vincent@bus-ex.com

Industrial Equipment Repairs, Inc. PRECISION IS OUR BUSINESS

Industrial Equipment Repairs, Inc. is an industrial machine shop specializing in precision parts fabrication and industrial mechanical work. We proudly serve the power generating, petro-chemical, pharmaceutical and general industrial contracting companies of Puerto Rico. Contact Details: P O Box 7749, Ponce, Puerto Rico, 00732-7749 Tels. (787) 843-6269 & (787) 841-1112 Email: ieripr@gmail.com

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million gallons of distilled water and drinking water per day. After servicing its own water needs the company is left with a surplus of some one million gallons of water which it uses to supply PREPA’s Costa Sur plant. The other ace up EcoElectrica’s sleeve is its LNG terminal. In addition to its above land storage facility, which allows the company to store to up one million gallons of LNG in liquid form, the facility also boasts four regasification units, each of which has a capacity to regasify up to 93 million square feet of gas per day. Two of these units operate on a continual basis while the others act as back up. “The terminal also acts as an import facility into which we receive between 24 and 26 shipments of natural gas per year,” Sanabria highlights. “On average the standard cargo we receive per shipment equates to some 119,000 cubic metres of gas, with nine of these annual shipments being consumed by

EcoElectrica

EcoElectrica’s above land storage facility allows the company to store up to one million gallons of LNG in liquid form

“EcoElectrica prides itself on being a long standing supporter of local communities, particularly when it comes to the education of children” ourselves and the remainder being used by PREPA as its Costa Sur plant.” EcoElectrica has always been among, if not the lowest cost producers of energy in Puerto Rico, however the benefit this provides consumers in the form of lower energy bills is far from the only positive impact the company strives to have on the island and its people. While admittedly the company’s various environmental initiatives did begin life as a demand of the permit requirements it was granted back in the 1990s they have

continued to grow well beyond the periods defined by these early agreements. Examples of EcoElectrica’s continued commitment include its monitoring of the ecosystem that exists in the Bay of Guayanilla in which it is located. Here it assists with the monitoring of sea life including sea grass, corals and nesting turtles, in order to ensure that there is no deterioration in sea life as a result of its activities or industrial processes. Social responsibility also plays a considerable part in the company’s operations, with

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The terminal receives between 24 and 26 shipments of natural gas per year

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EcoElectrica

“EcoElectrica stands poised, willing and able to maximise its own contribution in the form of low cost energy production”

EcoElectrica priding itself on being a long standing supporter of local communities, particularly when it comes to the education of children. “Every year we provide 40 scholarships to the most outstanding students graduating from both the Guayanilla and Peñuelas high schools as a way of supporting their individual process into higher education,” Sanabria enthuses. “Since 1999 we have awarded over $600,000 in scholarships, an investment that is worth every cent when we see these students returning as engineers, scientists and so forth, and thanking us for the opportunities we helped create in some small way.” In addition to the aforementioned programme, EcoElectrica also provides assistance by supporting a local kindergarten by supplying all the uniforms, books and stationary required for the children that are beginning their educational lives each year. Meanwhile the company is also active in helping communities develop ways in which they can better themselves, supporting various community outreach programmes that are designed to highlight the way people can achieve a better quality of life without the need of an open cheque book. At the time of writing, Puerto Rico faces a new challenge, one born out of the recent downgrading of its credit rating by several leading financial institutions. In recognising the part it has to play in helping the island’s Government to correct this financial situation, EcoElectrica stands poised, willing and able to maximise its own contribution in the form of low cost energy production, while also providing PREPA with increased

support by maximising the send out of natural gas to its Costa Sur plant. From a longer term perspective the company will be looking to develop the utilisation of its LNG terminal. “This facet of the business has great potential, with it being the only facility of its kind on the island capable of receiving and distributing LNG,” Sanabria says. “We see it as having the potential to positively impact several economic areas that have yet to be targeted in Puerto Rico, for instance the chemicals industry and the field of automobile applications. Our priority is to get the Government’s perspective regarding the terminal and how we can best align it to their plans in order to maximise the facility’s contributions. Meanwhile, we will also be keeping our mind open to the possibility of one day serving other Caribbean islands with LNG should that become a better way of maximising our potential in the long run.” Regardless of where the future may take its LNG terminal, there can be little doubt that as one of the lowest cost producers of energy on the island, together with its willingness to contribute to and improve the lives of Puerto Ricans, EcoElectrica will have an increasingly significant role to play in Puerto Rico’s future.

EcoElectrica

787-836-2740 yamaris.alancastro@ecoelectrica.com www.ecoelectrica.com

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Powering an

Saint Lucia did not attain full independence t nevertheless its electric power utility Saint Luc established in 1964, which means that this words by

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ELEC

island nation

till 1979, so as a nation it is just 35 years old: cia Electricity Services Limited (LUCELEC) was s year it is celebrating its 50th anniversary research by

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Line maintenance work being carried out

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rom the outset LUCELEC’s mission has been to provide an excellent service to its customers by adequately supplying a reliable and continuous electrical supply to the Saint Lucian population, at an affordable cost. Though it serves a small country of fewer than 175,000 souls, LUCELEC’s approach has earned it a reputation across the Caribbean as a very well-run, world-class utility regarded as a best practice benchmark company with a strong emphasis on customer service, innovation, employee development and social and economic development. The company went public in 1994, and its shares are traded on the Eastern Caribbean Securities Exchange. The company emerged as a unified and centrally managed source of power, from several small facilities dispersed around the

years ago there were still plenty of people who remembered the days when all we had were a couple of small systems in the larger communities, providing power for limited periods in the day,” he recalls. “We had already made significant progress, but we have made a lot more since. The system has now been developed island wide. Over 99 percent of customers who want electricity have access to it. Quality and reliability of supply has increased by leaps and bounds.” By the end of the 1980s the company was virtually self-sufficient in all but the most specialised needs. In 1990, new generating and transmission systems were commissioned which redefined the standards the company had previously applied to all its operations. The Cul de Sac power station was inaugurated

“Over 99 percent of customers who want electricity have access to it. Quality and reliability of supply has increased by leaps and bounds” island. This allowed for the expansion of facilities island-wide, as well as the opportunity to rationalise operating costs. The 1970s saw the company facing an explosion in the demand for power as hotel development and banana production transformed the economy. By the early 1980s it was clear that the company was entering a new phase and better trained people were needed to cope with an increasingly technological environment. The company initiated a highly successful craft apprenticeship programme and began the recruitment of graduate staff for all senior positions. Trevor Louisy was one of these graduates, a specialist in electrical engineering. He rose through the ranks becoming LUCELEC’s Managing Director in 2005. “When I joined the company 28

with three fuel-efficient, six to seven megawatt MAK engines. A 66 kV transmission system was introduced allowing the more efficient flow of power around the island. Over the years the company has added seven larger Wärtsilä units. The ultra modern power station and distribution grid are now the envy of sister utilities in the Eastern Caribbean says Louisy. Today LUCELEC employs 250 people but creates up to another 200 jobs within Saint Lucia through its contractors, who mainly work on transmission and distribution infrastructure maintenance, vegetation management and street lighting maintenance. These contractors, he says, have been developed and trained by LUCELEC over many years. But there is always room for improvement. “In 2014 we will be trying to improve our

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FINAL MILE LOGISTICS FOR OVER A HUNDRED YEARS Greenshields Cowie’s services include: • Pre-shipment inspection • Packing and consolidation • Marine cargo insurance • Warehousing • Multi-modal movements by sea, air and road • Customs clearance • Delivery to final in-country destinations For further details contact Sophie Brayfield Operations Manager, UK at Sophie.brayfield@greenshieldscowie.com Tel: +44 (0) 20 8643 3533 or visit our website www.greenshieldscowie.com

RELIABLE, COMPETITIVE AND FLEXIBLE

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performance in certain specific areas, such as losses, efficiencies and corporate diversification.” Losses are calculated by subtracting the units generated from those sold or consumed. The difference could be technical or non-technical – the latter a combination of illegal energy extraction such as meter tampering or losses resulting from old and inefficient meters. “We have made good progress in dealing with technical losses and we are working very hard to reduce our non-technical losses,” he says. “Last year we finally got total losses below the nine percent level and this year our target is to get the figure down to eight percent or lower.” For larger utilities the buzzword is smart metering. LUCELEC is keeping a close watch on innovation and as part of its programme of phasing out old meters is installing equipment that will support smart grid technology. That’s one for the future though. For now Trevor Louisy is keen to advance the adoption of alternative, green power on the island. “Developing alternative power sources is a major priority for us. We are disappointed that we have not made as much progress in the area of renewable energy as we

GREENSHIELDS COWIE FINAL MILE LOGISTICS FOR OVER A HUNDRED YEARS In a world that seems to be getting smaller, Greenshields Cowie (GSC) will help you gain an edge in today’s increasingly competitive global marketplace. Our unique network of partners and agents built up over a history that spans some 200 years ensures delivery to final mile destination time and again. We provide bespoke, innovative, logistical solutions to international development agencies and their clients, as well as long-standing commercial clients such as LUCELEC. Our services include packing, consolidation, Air and Sea Freight transportation, marine cargo insurance, warehousing, customs clearance and delivery to final in-country destination. www.greenshieldscowie.com

Trevor A. Philip Agencies Limited Trevor A. Philip Agencies Limited boasts a staff of fifteen (15) and is highly regarded as the number one shipping logistics provider in Saint Lucia if not in the OECS offering Customs Brokerage, Freight Forwarding, Packing, Ship’s Agents, and Household Goods Moving Services. Our affiliations with highly respected Associations, Shipping Companies, Packers and Movers worldwide have put us in the enviable position of being able to provide services to and from any continent. tpagency@candw.lc

Trevor Louisy, Managing Director

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inspired Your weekly digest of business news and views

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C O N G R AT U L AT I O N S T O L U C E L E C ON THEIR 50TH ANNIVERSARY

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would have liked, but I am hopeful of seeing reasonably significant developments this year and next year.” LUCELEC and the Saint Lucia government have been in talks aimed at reaching a consensus over renewables now that the country has changed its target to source 35 percent of its energy from renewable sources by 2020, up from 20 percent. Wind power is on the agenda, however Louisy is very conscious that the sun that brings tourists to the island could also be a major contributor to the energy mix and help reduce dependence on fossil fuels. “We have had some significant discussions regarding utility scale solar installations. Right now we are entering the third year of a pilot photovoltaic (PV) rooftop installation program and are currently finalising the tariff mechanism that governs how these systems feed into our grid.” The aim is to allow residential customers to connect systems of less than five kW to the

LUCELEC

CDS Power Plant at night

“Developing alternative power sources is a major priority for us” network – for now the main brake on rollout is the high capital cost. Recent discussions with the World Bank could open the way to a very interesting geothermal power project, he adds. Saint Lucia has geothermal potential from the sulphur springs in the west coast town of Soufriere, and Dr James Fletcher, Minister for Sustainable Development, Energy, Science and Technology wants to see this potential developed. “We believe it gives us an excellent opportunity to bring down the price

of electricity, secondly it gives us some buffer in volatility in world oil prices - and the more we can move our dependence away from oil and diesel, then the better for us,” he says. Though it ’s not as green as these technologies , natural gas is more environmentally friendly than oil and its increased use would help bring down electricity tariffs for consumers. In the absence of its own gas resources Louisy would like to be able to shift over to natural gas, but is constrained by the existing diesel plant at Cul de Sac. “We looked at HFO a few years ago but found that the investment we would have to make to convert our plant was significant, and it was around the same time that the differential between heavy fuel and diesel had reduced significantly, and along with the environmental considerations, we decided not to go ahead with that. However we took a policy decision that for

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LUCELEC was the main sponsor for the National School Sports programme

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“We aim to integrate, implement and promote socially responsible behaviour throughout the organisation and across our sphere of influence”

any new facility we might build we would commission engines designed to run on all or any of these fuels.” To reassure and attract potential investors Saint Lucia is moving to set up an independent national utilities regulator and recently brought together public and private sector stakeholders to discuss the draft legislation. LUCELEC is supporting this process, says Louisy, and taking a proactive stance in the discussions: “We want to make sure that there is transparency and integrity and that the government maintains a sort of arm’s length approach, not influencing or instructing the regulator as to what decisions they should reach!” At its own expense the company has been preparing the organisation and the staff, and engaging the external stakeholders, including the government, towards an understanding of the nature of regulatory best practice. Experts from the London School of Economics were invited to Saint Lucia last year to conduct in-house training “If regulation is not managed properly it can become very costly,” he concludes. “We are trying to make sure that we do the right things from the beginning rather than trying to correct errors at a later stage, when the damage is already done.” As a responsible service company LUCELEC has a robust CSR policy informed by ISO 26000:2010 guidance. “We aim to integrate, implement and promote socially responsible behaviour throughout the organisation and through our policies and practices, right across our sphere of influence,” says Trevor Louisy. The policy translated to

practical wins throughout 2013 in the areas of environment, sport, education, charity, culture and enterprise. Among these was funding for access to early childhood development interventions for children and parents in disadvantaged communities benefiting 3,029 children from 2,918 families. LUCELEC was the main sponsor for the National School Sports programme which included inter-school competitions in football, netball, basketball, cricket, athletics and tennis. It also sponsored the National Arts Festival, with a range of performing arts projects, and the Folk Research Centre’s Jennes Kwéyòl Pageant which encourages secondary school students to celebrate the island’s creole heritage. In the past 15 years LUCELEC has demonstrated a capacity to anticipate and plan for or respond to the changes in the industry and the operating environment, Trevor Louisy relates with pride. “Our resilience and response capacity has been tested and demonstrated with recent natural disasters like Hurricane Tomas in 2010 and more recently on the Christmas Eve trough, where we had significant rains on Christmas Eve and on Christmas morning with the loss of a number of lives. We are confident that we can rise to whatever new challenges are on the horizon!”

LUCELEC

+1 758 457 4400 info@lucelec.com www.lucelec.com

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PI Indu

Agriculture insp

PI Industries holds a unique position in the Indian agr supporting an ambitious programme of expan words by

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ustries

pired by science

rochemical industry, as reflected in its healthy growth, nsion in both the domestic and export markets ď ľ research by

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Agriculture input

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ith its origins in a vegetable oil production company that started at Udaipur in the western Indian state of Rajasthan in 1947, PI Industries is today ranked amongst the top five Indian agrochemical manufacturers, marketers and exporters and is listed on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE). It was also among the first companies to have its R&D facilities recognised by India’s Department of Science and Technology, for the development of pesticides and chemicals. PI’s strong capabilities in chemistry R&D attracted Sony Corporation of Japan to establish a PI-Sony Research Centre at Udaipur to work in the area of electronic chemicals. The company operates in two distinct market segments: Domestic Agri Inputs (AI),

to outperform the agrochemical sector and general industry. Strong demand for agrochemicals in India, supported by a good monsoon and a two-fold increase in exports led to sharp gross and net margin expansion for the company. “Our business strategy, built around having a strong customer focus, helped us achieve remarkable growth, even in turbulent times,” says Sarna. “The CSM exports segment has done exceedingly well, posting over 83 percent growth during the first nine months in the current fiscal year. During the same period, the domestic segment, despite multiple challenges has achieved over 22 percent growth, outperforming the sector’s growth statistic in this period.” A number of factors contributed to the sectoral outperformance of the domestic

“Our business strategy, built around having a strong customer focus, helped us achieve remarkable growth” which distributes crop protection chemicals and plant nutrients in the domestic market, and Custom Synthesis & Manufacturing (CSM), which carries out process research and manufacturing of chemical products for global agchem innovator companies. However, PI operates an integrated rather than a ‘twin towers’ company model, insists Executive Director Rajnish Sarna: “Ours is a unique business model, with two sides to it, domestic on one hand and CSM exports on the other.” They are different facets of a single business, focused on ultimately serving the agriculture sector in India and across the globe. Two years ago, when we last reported on PI, the business was doing really well, returning 30 percent year on year growth at the height of global recession. This level of performance has been maintained, and PI has continued

business. It should be remembered that despite increasing urbanisation and the growth of its manufacturing and high tech industries, India is still the second largest economy in the world in terms of farm output, with over 50 percent of its total workforce employed in agriculture directly and indirectly. In addition, Indian farmers are protected by minimum support prices (MSP), guaranteed by the government, on 25 staple corps. If there is a fall in price after a bumper harvest, the government purchases at the MSP. “The agriculture sector presents enormous potential for adoption of technological & chemical innovations” Sarna affirms, pointing out that it is a country that has well-adopted the introduction of biotechnology in Agriculture sector. To take its cotton crop alone, India is the world’s third largest cotton producer, and of that production, 90 percent is ‘Bt’ cotton.

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PI is targeting 40 percent revenue growth in the financial year ending March 2014. This is driven by rapid growth in CSM exports and a relatively good domestic crop season. On the CSM exports side of the business, says Sarna, the key drivers are commercialization of new molecules and market growth of commercialized products on a global scale. PI has an integrated business model built around the principle of trust and this is what unites the two sides of the business, he

explains. On the AI side, it partners with large multi-national companies looking for access to the Indian market wherein PI in-licenses and registers these products and market them under its own brand. On the CSM side, it partners with innovator companies looking to outsource process research and manufacturing of their newly discovered molecules. It is process research rather than product innovation that occupies the 150 people working in PIâ&#x20AC;&#x2122;s R&D laboratory.

â&#x20AC;&#x153;In the coming financial year we expect to launch several new products in the Indian market which will drive growth for our domestic businessâ&#x20AC;?

Research and development laboratory at Udaipur

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Manufacturing facility at Panoli

In line with its growth plan, PI lines”, says Sarna. The next Did you know? is making strategic investments phase will see the construction to enhance its manufacturing of two new facilities by the capacit y. Its G reenfield end of 2015, he explains, to 40% manufacturing site in a Special keep pace with the expected Revenue growth Economic Zone at Jambusar in organic growth of the company. target for 2014 Gujarat was commissioned in The company’s operations January 2013, to augment its also contribute to sustainable 300 existing manufacturing capacity development of the community. People employed at Panoli, Gujarat. “The Jambusar For instance, the Jambusar at Jambusar site plant currently occupied by a unit already employs around single product line is delivering 300 people at various levels. full capacity. Although, the plant PI Industries is expanding on is designed to produce multiple products, all fronts. “In the coming financial year we the current loading is aligned to customer expect to launch several new products in requirements. Also, in line with our longthe Indian market which will drive growth for term growth ambition, we have ensured that our domestic business. On the CSM side, we the site has adequate space and resources are expecting to commercialise a number of to install five to six additional production new products which are currently in the R&D

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Rajnish Sarna Executive Director Rajnish Sarna, a Board Member, has been associated with the company for the last ~20 years managing different portfolios. He has been a key member of the management team, instrumental in the overall transformation of Company over last few years. Rajnish brings to the table his diverse experience of over two decades in the areas of Business Development & Strategy, Customer Relationship Management, Operations, Finance & Risk Management, Legal Contracting & Compliances, Investor relations, Corporate Planning, Information Technology & Process Re-engineering. Rajnish in his current role is managing company’s growth strategy, custom synthesis exports and operations, evolving new business / partnership models, and overseeing Corporate Planning, Finance, Information Technology and Investor Relations processes at PI.

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Manufacturing facility at Jambusar

“To de-risk growth from region-specific challenges in this business, you have to operate on a pan-India basis”

pipeline. We are also in an expansion mode at Jambusar, and are focusing on building new capacities and new infrastructure that will support the kind of growth we are forecasting in the CSM exports,” says Sarna. The CSM segment is comparatively new, having only been established in the

PI Industries

mid-1990s, however the company will never lose sight of its domestic business, which has been nurtured for over 60 years now. PI brands such as Nominee Gold herbicide, Osheen, Roket, Foratox, Carina and Fosmite insecticides and Kitazin fungicide are well established in this market, and distributed through a network of dealers and distributors who cover most of the Indian states. “To de-risk growth from region-specific challenges in this business, you have to operate on a panIndia basis,” Rajnish Sarna explains. “And you also have to address a variety of crops, because if you limit yourself to a particular set of crops or geographic regions, then you are at a higher risk of being impacted by the vagaries of monsoon, food prices, and other factors. In one year cotton may do well: that will encourage farmers to plant it again the

following year. Production will rise, prices will fall, so they may then migrate to other crops like pulses or vegetable.” Forecasting is not easy, so it makes sense to reduce your risk vulnerability in this way, and psychology plays its part, he concludes. By covering all the bases with its portfolio of more than 30 branded products, PI Industries is ready to support farmers in sustaining the vital business of agriculture.

PI Industries

 +91 124 6790000  pifinechem@piind.com www.piindustries.com

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CON

Tailor mad

Managing Director, Michel Maalouf d and a drive to deliver results have co words by

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research b

ONCIEL

de success

discusses how a passion for creativity ontributed to the success of CONCIEL

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ounded in 2005, its focus being to provide clients with management consulting and IT solutions, CONCIEL has expanded over the subsequent years to become a business tasked with solving its customers’ mission-critical problems through the innovative application of technology and expertise. Driven forward by a team of people, who together are empowered to go the extra mile for its clients by delivering outstanding value and productivity, CONCIEL has always believed that its success has been built upon the fact that it creates fundamental and tangible results in all of its competence areas, as opposed to quick fixes. “The last year has been one of exponential growth for the company as we have expanded into new areas of business and new countries,” explains Managing Director, Michel Maalouf. The expansion that he speaks of has seen CONCIEL spread its wings in recent years into telecommunication services and more recently data centres. “Up until 2013, I was working for another business in parallel to CONCIEL which specialised in the telecommunications side of the business. Since that company was sold we have brought all of core services, both old and new, under one umbrella, that being CONCIEL.” The work that CONCIEL in its new,

“The last year has been one of exponential growth for the company as we have expanded into new areas of business and new countries”

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consolidated form carries out can be broadly separated into two categories, one being solutions and the other services. “The products and solutions that we sell and implement for our clients themselves fall under three headings, software, data centres and telecommunications,” Maalouf continues. “Particular software products that we see continue to see strong demand for include Electronic Document Management Systems (EDMS), Computerised Maintenance Management Systems (CMMS) and Risk Business Inspection (RBI) tools. However,

as some will know, software on its own is of little or no use without data, which is why we work to provide a full turnkey service that encompasses all of our solutions.” Turning to the types of service CONCIEL is able to provide, these fall into the categories of consulting, training and engineering. “Our consulting services are primarily targeted towards management consulting and are often tied to a client’s desire to attain certain certifications, typically ISO:9001,” Maalouf explains. “From a training perspective our efforts tend to centre on management

“We have at our disposal vast experience and a range of services and solutions, and we want to be able to offer them remotely to anyone who wants them”

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CONCIEL

and IT support, while our out its expertise and its ability Did you know? engineering services are very to provide a one-stop-shop for much focused towards the their needs. In addition to those telecommunications and data from the telecommunications 2005 centre aspects of our business. sector CONCIEL also lists The year that When it comes to the latter we clients from the oil and gas, CONCIEL was are able to design data centres facility management, food founded from the ground up, from the and beverage, manufacturing, building of the structure to logistics and water industries. the installation of electronic A diverse mix indeed, but and electrical requirements, through the they all share the fact that they identify supply of relevant products and equipment CONCIEL as the best provider for their needs. and their implementation. It is essentially a “I would say our greatest strength is that we case of starting with a blank sheet of paper believe in creativity and that we never look to and an idea, and ending with a tailor made impose an idea or a particular product upon solution.” a client,” Maalouf enthuses. “If a particular Across the markets that CONCIEL operates solution doesn’t fit the specification of the in, which today include Nigeria, Sierra Leone, client we will work to find one that does. It all Ghana and the Congo, a number of clients comes back to delivering tailored solutions from a variety of different industries seek that are individually relevant to each client.

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CONCIEL

“The other thing we want to improve upon is the way we utilise remote application tools, so things like cloud technology”

We are not the type of business looking to sell the same product to hundreds of clients; rather we are driven by the desire to sell them exactly what they need, which in turn provides them with the best end result.” This is an exciting time for CONCIEL, one that sees the company continue to build on the growth experience in 2013. In doing so it has brought to market several new solutions and services that the market has begun demanding. The first of these comes in the form of hosted application outsourcing. “This is where we actually outsource a particular application and instead of the client having to then support that by setting up the servers and infrastructure needed to house the application we offer to host it ourselves on our own servers, providing access to the client in question,” Maalouf says. “The first thing this means is that months do not have to be spent implementing a top to bottom solution for certain clients, rather what we can implement the application remotely. It also means that the support service we provide can be delivered faster as our team can gain immediate access to the server in question. So any client, based anywhere in the world, is able to gain easy access to our solutions without us having to travel miles to set them up.” Another area of excitement for Maalouf and his staff has been the introduction of the company’s Data Centre Information Management (DCIM) solution. “In the last decade the concept of data centres has picked up considerable steam and as such there is an increasing demand for related

software and solutions,” he says. “What we have developed here is a solution that is very new for the industry and is a one that we look forward to being able to provide as an added value offering to both our existing and new data centre clients.” For the time being Maalouf has a clear strategy that he intends to follow through with in the months ahead, one which revolves around continuing to service CONCIEL’s existing clientele, while at the same time seeking out potential new customers. “The other thing we want to improve upon is the way we utilise remote application tools, so things like cloud technology,” he concludes. “I want to get our business to the point where even management consulting is something we can provide remotely. This would allow us to provide a more efficient and less time consuming service to our clients. We have at our disposal vast experience and a range of services and solutions, and we want to be able to offer them remotely to anyone who wants them. This is something that is all the more vital considering our own location, that of our clients and of course their ever-evolving needs.”

CONCIEL

+337 8248 8844 info@conciel.com @CONCIELT www.conciel.com

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Neo

Providing coverage

By applying fresh thinking, a creative approach and flexible so to the point where it stands among the top-tier telecommun words by

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Will Daynes

research by

otel

age and connectivity

olutions for communications in South Africa, Neotel has risen nications businesses on the continent, let alone the country David Brogan & Robert Hodgson BE Monthly [ May 2014 ]

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Neotel has carved a place as a major force in South African telecommunications

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y offering voice, data and internet services over a single connection, Neotel has established itself as South Africa’s first converged telecommunications network operator. Founded in 2006 and backed up by the financial and technical clout of global communications company Tata Communications, Neotel has since become a major force within the country’s telecommunications sector. During its first four years in business, Neotel laid the foundations for its future success by investing some R4.5 billion in infrastructure alone, rolling out a new fibre optic communications backbone nationwide. This included higher density installation in the metropolitan areas amounting to some 5,000 kilometres of cable,

that have become epicentres for local and international business. As well as offering effective solutions that are suited to large, medium and small businesses in order to handle individual telecommunications needs, Neotel is also dedicated to providing cost-effective telephone and voice solutions. The company’s reliable data solutions are designed to provide businesses a competitive advantage thanks to a combination of high-speed performance, flexibility and cost efficiency, while its secure and competitive hosting provides customers with the most cost-effective solution to their IT infrastructure investment. Neotel is also the only Tier 1 operator in South Africa with a global reach. Through its

“Neotel laid the foundations for its future success by investing some R4.5 billion in infrastructure alone, rolling out a new fibre optic communications backbone nationwide” and delivering fibre communication to the kerbside for large corporate customers. Much of the Neotel service is internet based, and not only includes ISP services and managed global and local VPN services for corporate customers, but the company also introduced the first Metro Ethernet in South Africa. Today the company covers all major metropolitan areas of South Africa, in which it caters for wholesale, business and home customer needs, delivering services that reduce the cost of doing business through the optimising of advanced technologies. Neotel provides a range of value-added voice, data and internet services in order to support its diverse clientèle , be it home customers using telephone handsets to the major data centres

major shareholder, Tata Communications, it has managed to bring faster, more reliable internet to numerous areas of the country. As the leading converged South African fixed line telecoms operator, Neotel’s Carrier Services offers connectivity to the global internet backbone through its world class fibre optic network and expertise. With a network spanning 200 countries on six continents, its Carrier Services solutions combine next generation SDH, IP and ethernet capability, global reach with active local presence and support, ideally suited to mobile service providers, fixed line operators and internet service providers. Additional services offered by the company include Virtual Private Networks,

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Neotel

“Neotel’s greatest strength is reflected in its shareholding”

hosting and satellite services, while its various telecommunications licences, electronic communication network service licence and electronic communication network licence, allow it to provide a complete range of telecommunications services. Arguably, Neotel’s greatest strength is reflected in its shareholding, which embodies vast global as well as local telecoms experience, giving the company greater impetus to achieve its objectives. The company’s strategic equity partner, the Tata Group of

Neotel’s focus is on developing the customer base

t-systems T-Systems in South Africa – transforming business through innvoation As markets become increasingly tough, and IT products and services become commoditised, it is essential for companies to increase business optimisation through better efficiencies, processes and innovative technology. T-Systems in South Africa is meeting this requirement head on by creating new ways of optimising business, driven by its passion for excellence, transformation and innovation. T-Systems increases business optimisation through better efficiencies, processes and innovative technology such as apps. However, behind these benefits, T-Systems is driving zero distance between businesses and their customers, fostering a closer relationship, better service delivery and competitive advantage. A new landscape is emerging for business and in order to remain competitive they need to transform their business through disruptive technology including: • Cloud • Big data

• Social media • Mobility

• Security

This technology allows business to operate not only more efficiently but also to reduce costs. With around ten years of cloud experience, and the backup and support of its Germany-based parent company, T-Systems enables companies to make this transformation possible. It is not only through its innovative mind set, technology, skills and experience but also the company’s forward-thinking vision that guide’s its customers on the way to a digital future. One such example is the transformation of the IT of Africa’s biggest glass producer Consol. The project with T-Systems in South Africa provides a showcase on how digitising a traditional company supports its growth targets. Consol doubled its volume of glass production in just four years yet achieves a 16 % savings in IT costs in the first year. www.t-systems.co.za

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â&#x20AC;&#x153;Today the company is involved in a number of improvement projects designed to increase its cyber, wireless and IP capacityâ&#x20AC;? India (through VSNL and Tata Africa Holdings Pty), brings immense expertise derived from its worldwide telecommunications operations. This partnership gives Neotel access to international best practice and the latest technical innovations. Furthermore, Nexus Connexion, its Black Economic Empowerment (BEE) equity partner,

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has a broad based constituency which includes women and youth groups, while developmental NGOs, labour unions and businesses are represented by individuals and corporates. One private consortium in particular, Communitel, brings additional international and African experience through their various shareholders, including TelecomNamibia.

Neotel

Neotel has laid over 5,000 kilometres of cable

Today the company is involved in a number of improvement projects designed to increase its cyber, wireless and IP capacity. This work includes the ongoing construction of three massive data centres and the installation of more than 5,000 kilometres of cables. Connected to the South Africa Far East (SAFE) cable, Neotel also boasts a landing station on the SEACOM cable system project. The company is also a member of the Eastern Africa Submarine Cable System (EASSy) consortium and has invested some R80 million into the project to date, which is expected to go live in August 2014. The addition of EASSy will significantly boost international bandwidth capacity and redundancy, and increase Internet connectivity competition in South Africa.

In the last several months Neotel has successfully expanded its retail footprint by opening its second store at the N1 City Mall in Cape Town. It represents just the latest development for company that is pushing hard to reach R3 billion in revenue this year alone as more companies secure confidence in Neotelâ&#x20AC;&#x2122;s industry leading services.

Neotel

+27 11 585 0000 Neo.moabelo@neotel.co.za @NeotelSA www.neotel.co.za

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Andrew Howes Photography

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Your health in good hands Ascendis Health Chief Executive Officer Dr Karsten Wellner discusses the philosophy and values behind Ascendis Health, the home of some of South Africa’s leading health and care brands words by

Will Daynes

 research by

Peter Rowlston

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Supashape product range

ealthy Home, Healthy You.â&#x20AC;? That is the slogan that Ascendis Health lives by on a daily basis. While most traditional pharmaceutical companies focus their efforts almost exclusively on the intervention space of medical care, the best examples of products in this field being antibiotics or anti-inflammatories, Ascendis Health focuses on what it calls the entire spectrum of life, providing preventative, intervention and chronic treatments targeted at plant, animal and human health.

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Ascendisâ&#x20AC;&#x2122; principle strategy is to create a synergistic group of health product brands that cover the value chain from imports of raw materials, manufacturing, brands and through to distribution to consumers through retail and direct selling channels. Supported by its controlling shareholder, Coast2Coast, the company has over 1,070 staff, possesses an executive team boasting over 20 years of experience in pharmaceutical and consumer products (FMCG) industries, and boasts international sales within 45 countries.

Ascendis Health

“In the field of preventative care we are providing brands and treatments that allow people to work on the self-healing propensities of their bodies”

“One could certainly say that we take something of a holistic view towards health and life,” explains Chief Executive Officer, Dr Karsten Wellner. “In the field of preventative care we are providing brands and treatments that allow people to work on the self-healing propensities of their bodies, supplement their nutrition or lifestyle in a healthy way and which gives them the opportunity to avoid a situation where they become immune system-depressed or susceptible to illness or a disease. Then of course there is the invention

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side, where we offer pharmaceutical products and medical devices, and the area of chronic medication where you have pharmaceuticals for long term application.” As a business, there are three core areas of growth that Ascendis Health continues to pursue in order to expand. These areas are acquisitive growth, where the company acquires other businesses into its family of brands, organic growth, whereby the company provides entrepreneurs with the means and foundation to grow within the Ascendis family,

and lastly synergetic growth, where it brings together synergies between its divisions and brands for the good of the collective. This latter area is of particular significance given the way Ascendis Health’s operations are broken down into three main divisions; Consumer Brands, Pharma-Med and PhytoVet. Within its Consumer Brands division the company offers products from the likes of the healthy ageing specialists, SOLAL Technologies, SSN (Scientific Sports Nutrition), Foodstate Nutritional Intelligence,

“The brands that Ascendis Health acquires share specific qualities, namely that each has already proven to be a success and has international growth potential”

Lean Muscle Building Stack

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Ascendis Health

Nimue Skin Technology product range

specifically when it comes to Nimue Skin Technology, Did you know? our sports nutrition products, B io b a la n ce and E VOX and our Pharma-Med division. Advanced Nutrition. Meanwhile, 45 countries Here the latter is able to provide subsidiaries PharmaChem and In which these companies with increased Surgical Innovations operate Ascendis boasts levels of scientific research within the Pharma-Med division, international sales and regulatory backing.” while the Phyto-Vet division As Wellner goes on to explain, includes products from EFEKTO, 60 percent the brands that Ascendis Health AVIMA and Marltons. Ascendis’ acquires share specific qualities, “Across the three divisions we acquisition are constantly working on shared namely that each has already success rate in areas of interest, so things like proven to be a success and has the last five years supply chain issues, IT issues, legal international growth potential. details and other areas in which “We believe very much in strong your typical small or medium brands developed by healthy and sized business may have previously lacked resilient businesses that have been around for the funds or resources to handle in-house,” some time. As such when it comes to investing Wellner states. “We are constantly working in businesses we only ever target those with strong identities and positive cash flows. While to ensure a deep level of integration between of course we have the need to corporatise our our divisions as well. A good example of this business, what we are particularly proud of exists between our consumer brands division,

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Heard Tell us about your company and weâ&#x20AC;&#x2122;ll tell everyone else www.bus-ex.com

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Andrew Howes Photography

Ascendis Health

Karsten Wellner - CEO, Robbie Taylor - CFO and Richard Crouse - COO

“A key focus for the remainder of the financial year will be to continue delivering strong organic growth, integrating recent acquisitions and continuing to extract synergies” is the fact that at no point do we stifle the development of good entrepreneurial ideas. At the end of the day our aim is to give as much freedom as possible to our brands in order for these businesses to grow.” On 24 January this year the company issued a press release detailing the latest development in its acquisition programme, namely the 100 percent purchase of specialist medical company Surgical Innovations Limited and of Atka Pharma Limited. The acquisition of these two businesses was also

special in that they were the first two targeted acquisitions following Ascendis Health’s successful listing on the Johannesburg Stock Exchange in November 2013. “When it comes to securing acquisitions,” Wellner continues, “our success rate over the last five years is approximately 60 percent, which is quite significant. As with all of our acquisitions we are already looking at how to best integrate these businesses into our own, giving them additional support and ultimately providing them with fresh growth

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Andrew Howes Photography

Karsten Wellner CEO

Avima Grain Guard

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1989 â&#x20AC;&#x201C; 2001: Fresenius AG, Germany (DAX and NYSE listed Health company, 110,000 employees, $20bn sales). 2001 â&#x20AC;&#x201C; 2008: Fresenius Kabi, MD South Africa, Exec VP Africa and Middle East. 2 Production Units in SA and various subs, 700 staff; (products: clinical nutrition, generics, medical devices). Achieved businessgrowth in 8 years from R120m to R1bn sales. Part-time lecturer at the University of Stellenbosch Business School on International Management and Independent Board member at Alpha Pharm East Cape Holdings.

Ascendis Health

“The first area of importance when it comes to our future is to remain focused on our core fundamentals” potential in the form of either new products or new markets. So we are very much looking forward to moving these businesses forward.” While 2014 has already brought with it two new additions to the Ascendis Health family the company is well aware that there are many more opportunities ahead of it and in order to continue taking the business forward, Wellner and his team are embarking on a strategy targeting three particular areas. “The first area of importance when it comes to our future is to remain focused on our core fundamentals, so to continue doing what we do so well and that is taking our already strong brands and growing them accordingly,” he concludes. “The second thing we have to do is internationalise our business more in order to avoid foreign exchange fluctuations and create a better hedged position for ourselves. To this end we are already in the process of setting up our first international acquisition projects in Europe. Lastly we need to continue to grow ourselves, both organically and acquisitively.” Wellner’s mind then turns to one last shortterm goal for the company and that is to deliver on the promises made to its investors. “Over the course of the last year or so we have made promises regarding certain sales and profit targets and acquisitions, and I am pleased to say that we are more than on target to keep these promises, something which we confirmed to the market in our just released six months maiden result. A key focus for

Solal Stress Damage Control

the remainder of the financial year will be to continue delivering strong organic growth, integrating recent acquisitions and continuing to extract synergies both within and across all operating divisions.” Wellner concludes; “We are firmly on track and confident that we are going to exceed our committed full year pre-listing earnings forecast for the 2014 financial year.”

Ascendis Health

 +27 11 036 9400  info@ascendis.co.za @AscendisHealth www.ascendis.co.za

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