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BusinessExcellence Weekly

ISSUE No. 66 |


Energy for the future The largest energy supplier in the Province of Québec

Cobre Las Cruces:

Kenya Chamber of Mines:

Eskom Medupi:

Schaeffler Schaeffler, with its INA, LuK, and FAG brands develops and manufactures precision products for everything that moves—in machines, equipment, and vehicles as well as in aviation and aerospace applications. Innovations from Schaeffler make an important contribution to saving energy and conserving resources and, at the same time, increase performance and competitiveness of customers’ assets across the globe.

Heavy Industries (Subaru) and Nissan. Toyota Motor Europe expressed their high level of satisfaction by awarding Schaeffer with “Certificate of Recognition”, whereas in the Ford Motor Company in the USA honoured Schaeffler for excellent cooperation between the two companies. By presenting the World Excellence Award 2012, Ford recognized Schaeffler’s ceaseless efforts towards achieving excellence that significantly contributed to their success. In For example, FAG split spherical roller Japan, Schaeffler has received the Nissan bearings simplify and speed up bearing Global Supplier Award for development of replacement, particularly in areas that the LuK multi-link chain for continuously are difficult to access such as shafts with variable transmission (CVT). Among the multiple supports. With over 20 validated series of awards received in China is the coating solutions—down to just a few Excellent Supplier Award from Shanghai’s microns—Schaeffler’s Centre of Competence Sanden Behr Automotive, which recognized for Surface Technology has developed a Schaeffler for high technological expertise, modular system to offer bearings with longer excellent quality and service. In South life for every type of requirement. America, our INA and FAG brands ranked among the best suppliers for Brazil’s The Aerospace business operates under automotive replacement parts market by extremely high safety requirements. When receiving the Best of the Year Awards from it comes to engine bearings, leading aircraft Sindirepa. With a global footprint matching manufacturers place their trust in Schaeffler. customer requirements across the world, Schaeffler supplied the main shaft bearings for Schaeffler made its mark in Africa as well the Airbus 380’s engines as well as numerous by securing the first prize in General Motors rotationally symmetrical components, which South Africa’s Drive Train prize category. feature up to five different coatings. These numerous awards around the Schaeffler received numerous awards world testify to Schaeffler’s power from customers all over the world. These of innovation, quality of service, and awards serve as a constant incentive for performance that helps the company Schaeffler to remain the top supplier of offer the best products and solutions to high-quality precision products for global customers around the world. customers. Among this year’s achievements are recognitions from Toyota, Ford, Fuji

Included The BE Mining Directory showcases leading mining organisations from across the world, ranging from big corporations to junior mines and their supply chains. Be seen throughout our portfolio of magazines: • BE Mining Directory • BE Mining • BE Weekly • BE Monthly •

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Business John O’Hanlon Editor Will Daynes Editor Matt Johnson Art Director Louise Culling Production Designer Richard Turner Director of Sales

Business Excellence brings you content from leading business influencers and strategic thinkers providing inspiration and guidance to help you and your business grow. We showcase some of the best examples of successful organisations from around the world giving you a unique insight into how they operate.

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BE Weekly


issue No.66


8 hot topic

Reaching tipping point

With the government having been partially shut down, what will it take for the Democrats and Republicans to negotiate with each other.


14 Sustainabilty

Energy alternatives in Africa South Africa’s outgoing Minister of Energy shared with us her passion for finding sustainable energy alternatives.

22 Event preview

Dates for your diary A selection of upcoming events.


24 Hydro-Québec

Energy for the future

The largest energy supplier in the Province of Québec: it harnesses Canada’s fast-flowing rivers to satisfy the demands of both domestic and export markets in North America.

6 | BE Weekly


36 Eskom Medupi

Medupi’s strategic power

The new coal-fired power station that is being built at Lephalale in South Africa’s Limpopo Province is a megaproject that has delivered great achievements despite being faced by many challenges.

46 Cobre Las Cruces (CLC)


21st Century mining


By maximizing its return on considerable investment in recent years Cobre Las Cruces (CLC) is well on the way to achieving its vision of becoming a benchmark standard in modern mining operations.

54 The Kenya Chamber of Mines (KCM) A land of opportunity

Monica Gichuhi, Chief Executive Officer of the Kenya Chamber of Mines (KCM), discusses how the country is playing a vital role in making East Africa one of the most exciting new frontiers for mining on the planet.


66 kengas group

reliability in transport

Kengas Group Limited started with bulk petroleum products before moving into supply and delivery services within the Great Lakes Region including Southern Sudan.

68 Simang Group

Strength in numbers

By bringing viable businesses with strong growth potential under its wing, Simang Group is on its way to reaching its goal of becoming a platinum rated group of companies.

BE Weekly


Hot topic

g n i h c a e R

g n i p tip point States will have ed it n U e th , 3 1 0 2 , er b On 17 Octo ceiling. With t eb d s it d n te ex to e n hit its deadli y shut down, ll ia rt a p n ee b g n vi a h the government it will take t a h w n o ti es u q to g some are beginnin cans to realise li b u ep R d n a ts a cr o for the Dem ith each other w te a ti o eg n to s es n their stubborn one ultimately benefits no Words by

Will Daynes

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Hot topic


s the clock tolled midnight to usher in Tuesday 1st October 2013, one of the hardest fought tug-of-wars in recent political history reached an unwelcome stalemate, one that immediately resulted in the shutdown of the government of the world’s biggest superpower. I am of course referring to the failure of the US Democratic and Republican parties to pass a new budget before the fiscal year came to an end on 30th September. Stalemates between the Republican controlled House of Representatives and the Democrat controlled Senate when passing legislation have become a common theme since Barack Obama came to power, however eleventh hour agreements have, until now, averted a series crisis. This was not the case on this occasion, with Republican opposition to and Democratic support of the Patient Protection and Affordable Care Act, or “Obamacare” as it is commonly referred to as, proving too strong. The result has been the first partial shutdown of the government in 17 years. The first effects of the shutdown saw the White House budget office issue orders for government offices to begin closing down, with some 700,000 “nonessential staff” being sent home without

pay. In the days that followed national parks, museums, federal buildings and services have all remained closed, while pension and veterans’ benefit cheques have also been delayed. While the initial fall of the US dollar to an eight month low against other major currencies has been viewed as less of a steep drop than some expected, economists will be well aware of the effects of the last shutdown in 1995. Lasting a total of 21 days it is thought to have cost the US economy more than $1 billion. Of course it is far too early in the game to think that this shutdown will last as long as in 1995, however the timing of today’s deadlock could hardly be more alarming, what with 17th October marking the deadline for the US Congress to raise the country’s $16.7 trillion debt ceiling, the limit at which it can borrow money to pay its bills. Should we reach this date without agreement between the two political parties the US, and indeed the economic world, will be entering dangerous, uncharted waters. It is estimated that without a deal on the debt ceiling the US Treasury will be left with only $30 billion a day to pay bills that often total twice that amount for daily expenditures. The result could well be

deal on the debt a t ou ith w at th ed at tim es is “It ft with only $30 billion le be ill w ry su ea Tr S U e th ceiling tal twice that amount to n te of at th lls bi y pa to y a da for daily expenditures” 10 |

BE Weekly

that the US ends up defaulting on its debts for the first time in history. As well as damaging confidence and driving up the cost of borrowing for Americans, the effect of such a shockwave would no doubt be felt across the whole world. US bonds, or treasuries as they are commonly referred to as, have until now always been viewed as a safe investment, thus we have a situation today where trillions of dollars are tied up in them. A default would surely spark a chaotic situation on the international market for debt, with investors not wanting to accept bonds that are no longer being honoured. That in itself would be a major issue what

with the market not set up to deal with rejected bonds. The immediate period would no doubt be a confusing one for traders as the market adjusts itself to a completely new situation. At this point in time of course it is hard to predict exactly what might happen in the event of a US default. Analysts of a less pessimistic nature suggest that much would depend on just how long said default lasts. While they agree that investors may be prepared to wait out a short disruption, a lengthy default would likely result in money being switched into other perceived safe havens, such as German and Swiss debt, or maybe into gold. Considering that the $12 trillion of outstanding government debt held by the US Government is approximately 23 times the $517 billion that Lehman Brothers Holdings owed when it filed for bankruptcy in 2008, it is understandable that for those of a less optimistic disposition a US default spells for them an event that will throw the world’s economies into a recession that would ultimately become a depression. As the hours and days pass, with as yet little evidence of progress being made in Washington, pressure continues to mount on the US, with the most recent concerned voices heard being those of the Chinese and Japanese. In its first official reaction to the looming

“The $12 trillion of outstanding government debt held by the US Government is approximately 23 times the $517 billion that Lehman Brothers Holdings owed when it filed for bankruptcy� 12 |

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Hot topic

event that will throw “A US default spells for an recession that would the world’s economies into a on” ultimately become a depressi a scenario even occurring is virtually impossible, however the fact that such farfetched ideas are even being mentioned really does highlight how fundamental it is for the two main US political parties to cease their posturing and begin to reach some form of mutual understanding. Last minute agreements and extensions have in the past been enough to stave off any lasting consequences of the ongoing bickering on Capitol Hill, however with this particular game of chicken looking set to go to the wire, one has to wonder just how high the stakes need to be before the two parties recognise what the consequences could ultimately be because of their failure to find common ground. John Boehner

Picture credit: Gage Skidmore

debt ceiling deadline later this month, Beijing said “the clock is ticking” and urged politicians in Washington to “ensure the safety of the Chinese investments”. Japan’s Ministry of Finance meanwhile has expressed its worry about the potential impact on currency markets, particularly with a US default likely to cause investors to dump the US dollar, which would sharply push up the value of the yen. So what are the options on the table that would spare the world the suffering born of the aforementioned scenarios? Unfortunately, at this moment in time, it looks like agreement between the Democrats and Republicans is as out of reach as ever, what with John Boehner, the Republican speaker of the House of Representatives, declaring it is “time for us to stand and fight” over the US budget. With this in mind it has been indicated that the Obama administration might consider a short-term lift of the ceiling, however due to the fact that it would rest upon Congress to decide the duration of said increase this could merely spread the flames of political disagreement further still. This has led some to even speculate that a more radical approach may be required which would see the President officially ignoring the debt ceiling. Such an act would see him breaking the law and opening himself to impeachment. The reality of course is that such

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Energy alternati

Just before moving across to the Ministry of Tran shared with us her passion for weaning her countr alternatives: The record of the last four years ha Words by

14 |

BE Weekly

John O’Hanlon


ives in Africa

nsport, South Africa’s outgoing Minister of Energy ry off its addiction to coal and finding sustainable as been impressive but much remains to be done |

Research by

James Boyle BE Weekly

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hen President Jacob Zuma appointed Elizabeth Dipuo Peters to the post of Energy Minister in 2009 one of the key performance areas he asked her to progress was getting greater private sector involvement in power generation. She very quickly perceived that some of the best opportunities to achieve this lay in the renewable energy sector, so as a passionate believer in sustainable energy policies, she targeted the exciting emerging technologies and the companies that could help South Africa’s achieve its ambitious target to dramatically cut its reliance and generate 42 percent clean energy by 2020 and cut carbon emissions by a similar figure by 2025. “I saw an opportunity to use renewable energy as an instrument to bring in the independent power producers,” she says. By 2011, the year South Africa hosted the international Climate Change Conference COP17, her ministry announced its target to obtain 3,725 MW of renewable energy in two bid rounds, called Window 1 and Window 2. “In Window 1 we managed to get 28 preferred bidders, I am happy to say, all of whom qualified for government financial incentives, and these are the companies building the first 28 plants.” This, she says, will feed into the National Development Plan, South Africa’s blueprint for development over the next

20 years, which aims to create a low carbon economy by 2030. A key factor in this strategy is the Integrated Resource Plan which sets out energy strategy from 2010 to 2030, which takes on board the 42 percent renewable power policy, she continues: “The biggest beneficiary of this 42 percent is photovoltaic (PV) solar and wind. Concentrated solar power (CSP) accounts for a smaller proportion, and of the 17,800 MW renewable we are committed to installing by 2030 most will come from wind and PV solar.” The original 28 bids, approved in November last year, will contribute 1,400 MW. To these have now been added a further 19 projects under the Window 2. They were given the go ahead in May 2013 and will contribute a further 1,200 MW of capacity. The present state of play, then, is that 47 private operators are now developing projects right across the country, to Mrs Peters’ great satisfaction and funded by the government to the turn of R75 billion ($7.6 billion). To this, she points out, should be added the national power generation company Eskom’s own 200MW renewable energy project, 50 percent generated from wind energy resources and the other 50 percent from CSP. Nearly half of current renewable power developments in the country in the country are located in the Northern Cape Province. Could that have something to do

“I saw an opportunity to use renewable energy as an instrument to bring in the independent power producers” 16 |

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The IDC is the biggest supporter of tenders awarded in the

Over the next five years, the IDC will make available R25 billion

Department of Energy’s Renewable Energy Independent

to fund projects related to green industries.

Power Producers (REIPP) programme. The IDC is identifying and providing funding for many projects In the first round of REIPP tenders, the IDC participated in

that will contribute to building South Africa’s industrial capacity

twelve successful bids, and seven more in the second round.

and creating jobs. Visit to find out more.

The green energy bids include wind power, concentrated solar power, photovoltaic and small hydro projects.


The power behind renewable energy

Telephone: 086 069 3888 Email: To apply online for funding of R1 million or more go to


with the fact that Elizabeth Dipuo Peters is a former president of the province? She says it is more likely to be because this is the province with the highest direct normal irradiance (DNI), a measure of solar radiation. It is also home to the Northern Cape Solar Corridor, which includes proposed sites near Upington, Groblershoop, Prieska and De Aar. Working with organisations such as the South African National Energy Association, the South African Independent Power Producers Association and the South African Wind Energy Association and SANEDI, the South African National Energy Development Institute, the Department of Energy is working flat out to promote renewable energy, she says. However this has to be done within the context of other national priorities, she adds. “We have built into our procurement processes the need for localisation. We want as many of the components as possible to be made here. That way the renewable programme will boost South Africa’s economic development and skills base.” This is new and exciting technology, she points out, giving a unique opportunity to the country’s research and development community as well as growing employment. She is hopeful that a real partnership can develop between local and global manufacturers. Another aspect of renewable power

generation that excites her lies in its potential social impact. “ At World Environment Day In June this year South Africa was invited to become part of a renewable energy club made up of ten committed countries. The Secretary General of the UN has identified renewable energy as one of those instruments that can actually unlock access particularly in parts of the world suffering from energy poverty.” As the German Environmental Minister Peter Altmaier said at the launch: “Renewable energy is not only a

“Renewable energy is not only a good way of combating climate change, it also contributes to prosperity and supply security throughout the world” BE Weekly

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good way of combating climate change, it also contributes to prosperity and supply security throughout the world.” For South Africa this could mean bringing the potential for renewable microgeneration into the mix, enthuses Mrs Peters. “In a move towards decentralised generation we are looking at incentivising neighbourhood and community groups to use either wind or solar to generate their own power and create their own energy distribution networks. This is one space we are very excited about!” Local projects also contribute to the 42 percent target, she points out. Even a small component of society like a municipality landfill gas programme can use waste to generate power; waste vegetable matter from a school can go into a biodigester to generate gas that can be used to heat that school. Even at a household level there is huge potential, even if they can’t generate power at the grid level. In 2009 Peters announced a programme to install a million water heaters in homes and commercial buildings, and so great has been the uptake that this number is sure to rise. She particularly likes the fact that this initiative directly improves the lives of women, relieving them of the need to go out and collect wood for heating water. In more densely populated areas there is a different approach. For example in

“I have visited many factories in South Africa that are manufacturing key components” 20 |

BE Weekly

Gauteng Province, her ministry is working with the Department of Public Works as well as the Department of Infrastructure Development of Gauteng to retrofit the government buildings to renewable energy (normally solar panels). We believe that would also add to energy efficiency as well as introducing renewable energy. That is a double-barrelled type of project that is going to have dual benefits for us as a government and also as a country.” Biomass is another way to produce green energy on a localised basis. Bagasse may be a new term to many people, but there’s a lot of it in southern Africa. It is the fibre that is left when sugar cane or guinea corn stalks have been crushed. Nearly a third by weight of sugar cane ends up as bagasse, and despite its high moisture content it is very effective when combined with other forms of biomass such as timber shavings to generate electricity. Mrs Peters is keen to work with the producers in South Africa who between them produce nearly 20 million tonnes of sugar cane, as well as the timber and sugar cane industries of neighbouring countries like Mozambique and Swaziland.


If all these initiatives are co-ordinated and taken seriously demand on the national power grid could be lightened significantly. Street lighting, traffic lights, perimeter lights and security lighting are all examples of medium- to low-load areas that could be brought into sustainable local generation schemes – at the same time, she believes that encouraging this way of thinking could create the necessary critical mass to sustain local production of components and stimulate new industries and yet more employment. “I have visited many factories in South Africa that are manufacturing key components. They are even producing solar inverters that change DC from the PV panels to AC for the network. The geyser industry is also growing, as well as solar panel assembly. Energy policy can be a catalyst for job creation: it has the potential to reduce poverty, especially energy poverty.” As she mentioned before renewable energy is a job creator as well as an investment magnet. “We are told the number of jobs resulting from Windows 1 and 2 alone is around 13,000. In one small town in the Northern Cape one

“In the beginning the technology developers will have to make it possible for us to create the market” company now employs 500 people. For a small town that is massive. And it restores the dignity of those people.” The stumbling block is the cost of the technology and she is determined to tackle that. Another spin out from COP17 was the South Africa Renewable Initiative (SARi), launched as an International Partnership by South Africa together with Denmark, Germany, Norway and the UK, and the European Investment Bank. SARi is a funding mechanism, she explains, that will help South Africa unlock its green growth potential through the funding of large-scale renewable developments. The goal is to help cut technology costs. “But we are also calling on the technology developers because they are mostly international players. If they believe in the future of renewable energy they should be prepared to do more than just drive returns on their own investment. If this technology grows more and becomes available, especially in developing countries, in the long run they will get enough returns; but in the beginning they will have to make it possible for us to create the market.” The wind and sun, she says, come at no cost and are everyone’s birthright. It is in everyone’s interest to get the cost of converting these natural resources into usable energy.

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KPMG Global power and utilities conference 2013

27-28 November 2013 Hotel Adlon Kempinski, Berlin, Germany The KPMG Global Power & Utilities Conference is KPMG’s premier event for CEOs, divisional heads and financial executives of the power and utilities sector presented by KPMG`s Global Energy and Natural Resources Practice. The conference brings together 300 executives of power producers, developers, investors, regulators and other industry stakeholders (NGOs, Research Institutions etc.) from over 40 countries around the world in a series of interactive discussions. Keynote Speakers Michael Andrew

Chairman, KPMG International

Alistair Buchanan

Chairman, KPMG’s Power & Utilities practice in the United Kingdom from 1st October 2013, Former Chief Executive Officer of OFGEM

Günther Oettinger

Member of the European Commission, Commissioner for Energy

Dr. Fatih Birol

Chief Economist, International Energy Agency (IEA)

22 | BE Weekly

Denis Vladmirovich Fedorov

Head, Directorate for the Development of the Power Sector and Marketing in Power Generation, Gazprom and CEO, Gazprom Energoholding

Marcus Spickermann

Managing Director, car2go GmbH and Chief Financial Officer, Daimler Mobility Services GmbH

Dipl.-Kfm. Klaus Becker

Chief Executive Officer of KPMG in Germany

Thomas Piquemal

Group Senior Executive Vice President, Finance, EDF Group

Dr. John E. Parsons

Executive Director, the MIT Center for Energy and Environmental Policy Research

Paul van Son

Chief Executive Officer, Dii (Desert Energy Industrial Initiative)

Dates for your diary

Mining technology and operations summit 2013

18-19 November 2013 Rendezvous Hotel, Perth The Mining Technology & Operations Summit is the premium forum bringing elite buyers and sellers together. As an invitationonly event taking place behind closed doors, the summit offers senior mining executives and solution and service providers an intimate environment for a focused discussion of key new drivers shaping the mining industry.

Enviromine 2013 4-6 December 2013 Santiago, Chile

Mines and Money London 2013 1-5 December 2013 Business Design Centre, London

Mines and Money London attracts 260 mining companies and over 3,000 senior investment, finance and mining decision-makers for up to five days of networking, learning and deal-making. Be at Mines and Mondy London this year to gain access to: • The widest selection of mining investment opportunities in Europe • The biggest gathering of qualified investment capital providers under one roof • A content-packed conference agenda filled with investment insights and capital raising ideas • An established event (its 11th year) renowned for its deal-sourcing potential Confirm your place at Europe’s largest mining investment and capital raising forum. READER OFFER: Quote Promo code ML775BE to obtain your Business Excellence 10% discount.

The 3rd International Seminar on Environmental Issues in Mining. This seminar offers the chance to share our experiences in environmental management throughout the mining cycle and learn about new proposals and responses to the environmental challenges facing the mining industry today. It is an invitation open to representatives of mining companies, government agencies, academic institutions, engineering companies, consultant groups and research and innovation centres.

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Energy for

the future Hydro-Québec is the largest energy supplier in the Province of Québec: it harnesses Canada’s fast-flowing rivers to satisfy the demands of both domestic and export markets in North America

written by: John O’Hanlon research by: David Brogan

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A view of the dam as the ground work begins to take shape



ydro-Québec owns and operates 60 power-generating facilities across the province. It was created in 1944. “At that time it was essentially an electricity distribution operation, with some generation in the greater Montreal region,” explains President and CEO Thierry Vandal, who has led the company since 2005, having joined it in 1996. “That was the situation until 1963 when, through a number of acquisitions, the corporation grew to develop a footprint which covers all the territory of Québec. HydroQuébec became a regional player.” Over several decades the company mainly expanded hydroelectric power, with 98 percent of its output today coming from hydroelectricity, a clean and renewable energy. Hydro-Québec built the 15,000MW La Grande River complex at James Bay in northern Québec between 1971 and 1996. The complex accounts for half the province’s installed capacity and is still today one the most important hydroelectric complex in the world. 1,000 kilometres north of Montreal, La Grande demonstrated the company’s ability to deliver huge capital projects, in challenging conditions with all the associated infrastructure of roads, campsites, transmission lines and airstrips. The most recent project to be completed was the $5 billion Eastmain 1A-SarcelleRupert project, in the James Bay area. It was launched in 2007 with approval to build the Eastmain-1-A and Sarcelle powerhouses and divert part of the Rupert River’s flow. The diversion began in 2009, two of the three generating units at Eastmain-1-A powerhouse

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.. ..

Clients benefit from Neilson’s huge… Know-how Fleet of leading-edge equipment Multidisciplinary first-rate technical team Ability to carry out large-scale projects

Wuskwatim Generating Station Intake Powerhouse under Construction, Wuskwatim, MB

Hydro-Quebec, Péribonka Generating Station, Péribonka, QC

St. Lawrence Pipeline, QC

Hydro-Québec were commissioned in 2011, Neilson the third in January 2012. Neilson is a general contractor specialized in civil engineering The first generating unit at on a monumental scale. Since 1963 public and private sector Sarcelle powerhouse was partners in Quebec, and elsewhere in Canada, have counted commissioned in April 2013 on Neilson to break new ground, meeting the most extreme and the two other units have challenges while standing behind the quality of our work. now come on line. “From an Partnership with Hydro-Quebec on La Romaine project is an example of what we proudly realize. environmental and logistic standpoint it was the most challenging project in the history of Hydro-Québec,” he says. “It covers an area the size of some European countries but we were able to bring it in on time and a little under budget so we are very proud of that result.” Hydro-Québec is unusual in that it manages these large construction projects by itself instead of outsourcing the engineering, procurement and construction. “We are an organisation with a strong culture of growth and project execution,” says Vandal. “That expertise has developed over the years as we went from one project to another and it’s taken us to a level where we can undertake very sophisticated large capex projects involving challenging infrastructure and logistics. That is an area in which we very much excel.” But it’s not all about delivery. Another Spillway construction significant factor has been the way the company has arrived EBC Inc. at a deeper understanding of EBC Inc., for over 30 years, has been a proud partner in the what he calls ‘the equilibrium success of Hydro Quebec projects. Besides hydro-electric of development’ – the works, EBC diversifies its achievements in sectors such as balance between finance, the building, civil engineering, earthworks, marine engineering, regional economy, and also, mining works (open pit and underground), wind farms and crucially, how to address pipelines, with its works being performed throughout Canada. environmental and social aspects. “A very significant

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“A very significant key to our success over the last 15 years has been the renewed partnerships with aboriginal communities” key to our success over the last 15 years has been the renewed partnerships and understanding of the importance of our relationships with aboriginal communities. We never tackle a new project without strong buy-in from local populations.” You can’t put a multi billion-dollar megaproject into the environment without some impact, but Hydro-Québec’s goal is to fit in with the ecosystems in a way that

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guarantees that those ecosystems afterwards will be just as productive as they were before. That applies to natural habitats and wildlife, the way of life and the cultural expectations of the trappers and tallymen among the First Nations and other long-term inhabitants. “We take our ideas to the aboriginal communities before they are fully formed, then work together to develop it so it becomes their project as much as ours.”


Hydro-Québec’s goal is to fit in with the ecosystems

This gives space to traditional knowledge, which any incomer ignores at peril. “There is more than science to these things, there is a traditional understanding of ecosystems that has been carried over the centuries.” It takes humility to put aside your scientific assumptions and listen to what the locals say, he recognises. The old ways of living and the associated wisdom do have to be preserved, but the First Nations live in the 21st century just as much as Montrealers. They want to see their share of the economic upside of development in their territory and Hydro-Québec always wants to make sure to maximise the business capacities in the communities. “We reserve a portion of contracts with these communities so at the end there remains a significant

business infrastructure and ecosystem that can go beyond and work in other areas whether it is mining or other infrastructure development,” Vandal observes. “We have been working in some of these communities for up to 40 years, and today they have very sophisticated capacities in terms of executing civil works and being present in the supply chains for things like catering, fuel supply, air transport, helicopters and the like.” The Eastmain 1A-Sarcelle-Rupert project was completing just as Hydro-Québec entered what is undoubtedly it flagship project today. The $8.5 billion Romaine Complex launched four years ago is one of the largest construction projects currently under way in Canada. It has two large components, Vandal explains: a $6.5 billion four-powerhouse complex on

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the Romaine River in eastern Québec and a $2 billion new high voltage transmission lines to carry the 1,550 MW it will generate to markets further to the south. “We are now almost half way through the project,” he says. “The first power house, Romaine-2 will be commissioned by this time next year so it is very advanced and we are well under way

with RO-1, RO-3, and the fourth one, RO-4, which is way up north on the river, will be started in the coming year.” The entire project is scheduled to be delivered in 2020. That the terrain is difficult was recognised as long ago as the 1630s when the first Jesuits to arrive described the locals as Montagnais – mountain dwellers. For this, construction

“The way the markets work in North America, the border does not really exist!”

Camp Murailles

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Hydro-Québec works with the local communities

camps for some 2,500 people had to be built, as well as 150 kilometres of road. “Before we went through the environmental review we made sure we had signed impact benefit agreements (IBAs) with both the aboriginal and non-aboriginal communities living within a perimeter of a couple of hundred kilometres from the river.” The Innu communities of Ekuanitshit, Nutashkuan, Unamen Shipu and Pakua Shipi participated in the environmental impact studies and will participate in the environmental follow-up monitoring until 2040. The estimated cost of the studies, mitigation measures and environmental monitoring is $320 million and covers fish habitats, wildlife and

archaeology which has shown evidence of settlements going back 2,000 years. In terms of local benefits, employment and contracts, Hydro-Québec typically tries to works with existing community organisations who will hire themselves. This works better according to Thierry Vandal: “We find that when the project is completed we leave an organisation that can take on other work.” The companies and institutions are made stronger and more sustainable. The supply chain for a large scale project like the Romaine is a global one. For example turbines are supplied by Alstom and Voith, the transmission grid will involve global suppliers like Alstom, ABB, Siemens. The assembly

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A view of the dam as the ground work nears completion


$8.5 Billion Cost of the Romaine Complex (generation and transmission) being made right on-site pulls in a lot of trades. Contracts and purchases of goods and services are estimated at $3.5 billion for all of Québec, with about $1.3 billion for the Côte-Nord region alone. About 40 percent of the workforce consists of people from the Côte-Nord, including a significant number of the Innu people. The Romaine Complex will secure Québec’s energy future and take advantage of opportunities to sell power outside the province. The USA’s demand for green Canadian hydropower is growing. In a project with Blackstone Group Hydro-Québec may take up 75 percent of the capacity of a new 333-mile transmission line being built by Blackstone Group from the Canadian border and running underground and under the Hudson River, into the heart of New York City. “We are also very active in the development of high-voltage DC transmission, which allows the interconnection of import and transmission systems in a very efficient and cost effective way,” he says. “The way the markets work in North America, the border does not really exist!” For more information about Hydro-Québec visit:

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Medupi’s stra

The new coal-fired power station South Africa’s Limpopo Province i great achievements despite be

written by: John O’Hanlon | research 36 | be weekly

Eskom Medupi

ategic power

that is being built at Lephalale in is a megaproject that has delivered eing faced by many challenges

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Back of Boilers at different stages of construction

Eskom Medupi


ince we last spoke to Roman Crookes, project manager of the R105 billion Medupi power station, he has refereed a game of two halves. The press has had a field day throughout the three years since June 2010, and any observer could be forgiven for thinking the site has been a battlefield. However in every problem lies an opportunity, and it was good to get a chance to hear firstly about the achievements of the project, then about the good that has come from the setbacks that have been encountered. As Crookes puts it: “This year has been satisfying: we have seen a lot of progress on construction, though unfortunately that progress can get lost in the noise.” One of this year’s most significant milestones was the conclusion of an agreement between Eskom and Exxaro on a new schedule to supply the huge amounts of coal that will be needed from the Grootegeluk mine. This takes into account the delay in starting Unit 6, the first of the 800 MW units that was due to be completed by the end of this year but will now only be connected to the grid in the second half of 2014. “The infrastructure between us and the mine is now fully established and Eskom has 160,000 tonnes of coal on site,” says Crookes. The coal stockpile capacity on the 900-hectare site is 2.4 million tonnes, to keep all six units fed once they are all commissioned. Eskom now has the option to defer the commencement of coal deliveries to the Medupi power station from March 2013 to the first quarter of 2014. The subsequent rate of coal deliveries will then be increased to take the full volume of the deferred coal

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Eskom Medupi over a period of 24 months prior to December 2016. A second achievement that pleased the project team as they saw plumes of smoke arising for the first time, was the commissioning of the auxiliary boiler, an oil fired plant that produces the steam needed for chemical cleaning and testing Unit 6. This was something of a landmark, the first new boiler commissioned on a construction site in South Africa in the last 20

years. In advance of this too, the bulk fuel oil plant that will be used for the ignition phase of the boiler units as well as running the auxiliary boiler was commissioned. The water treatment plant is nearing completion too, as are vital fire protection and auxiliary cooling systems. All that is needed now is for the number 6 boiler to be commissioned – the turbine for that unit has been rotated to test bearing clearances

EXXARO Exxaro Resources is one of the largest South African-based diversified resources groups, operating the Grootegeluk Mine near Lephalale in the Limpopo Province. The mine has been contracted to supply coal to Eskom’s Medupi Power Station which is currently under construction. A 40-year agreement requires Grootegeluk to deliver approximately 14,6 million tonnes of coal per annum to the power station. To enable this, significant expansion of the mine and development of the surrounding area were necessary. The project involved geology, mining, metallurgy, civil engineering and construction solutions which were planned and managed by Exxaro in conjunction with Eskom, the Lephalale Municipality and other stakeholders. The Grootegeluk Medupi Expansion Project involved five key elements: 1. Expansion of the pit.

2.Building two new coal processing plants (GG7 and GG8) and supporting infrastructure (such as two new additional blending beds and coal delivery conveyor systems) to deal with the increased volume of coal to be produced. 3.A backfill project to return overburden and discard material to the pit, which would previously have formed a surface ‘dump’. 4.A housing project to build 740 new houses in Lephalale to accommodate workers attracted to the region by the new power plant and mine expansion. 5.General infrastructure requirements in the region such as the development of local roads, stormwater drainage systems and electrical substations, the rehabilitation and expansion of the local Zeeland Water Treatment Plant and general warehousing requirements.

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Mr Roman Crookes, General Manager

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and the lubrication. The Unit 6 Generator Transformer has been back-energised, which means it is now connected to the grid. Very recently the turbine contractor Alstom installed its final stator. All the plant really needs now is a supply of steam. However it is well documented that the steam will take a little longer to flow than originally envisaged. Given the perfect storm of problems the plant has faced, a few months’ delay is not surprising. With the completion of some of the civil works the number of workers on site has come down from the original 18,000 to around 16,000, 95 percent of them South Africa nationals. Much of the delay has been caused by labour issues affecting the seven different unions that represent them. A lot has happened in the labour relations field over the last three years. A Project Labour Agreement (PLA) was entered into by contractors and unions, and worked well until at the back end of 2012 when some of the unions withdrew. This introduced a fracture among the unions themselves, says Crookes, and that forced Eskom to step in and intervene, working with the unions and contractors to forge a new agreement to replace the PLA, that this time included Eskom as a signatory and regulates labour relations at both Medupi and the other large plant under construction, Kusile. Among other things, the new Partnership Agreement (PA), signed on June 12 this year, prescribes a minimum wage for all hourlypaid contractor employees; standardised pay rates within each company, across companies and within the same industries; and allows parties to appoint a task team to address

Eskom Medupi

Segwate pre-school at Medupi, built as part of its corporate social responsibility

skills development and training needs. “The PA irons out the kinks in the PLA that caused much of the tension,” Crookes says. The period that led up to the PA had seen some disruption, and that disruption has continued, with a wildcat strike on July 24 that resulted in property damage on site. This was caused by miscommunication around the question of pay for commuting time for the approximately 50 percent of workers who live within a 70 kilometre radius of the plant. Workers are affected differently depending on precisely how far from the site they live. The situation is now settling down well,

though, as the workers themselves appreciate that their new minimum wage is well above national levels in the construction industry. The new PA is nothing less than a game changer for the entire South African construction industry, Crookes claims. “Eskom, as a client, is now actively influencing the construction environment for the better. The new PA agreement we have struck is now being used as a reference point for the unions when they are negotiating other contracts.” On its own, the delay caused by labour disruption would account for much of the slippage in project delivery. However severe

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technical problems have played their part too. One issue was where the boiler contractor Hitachi fell foul of an Inspectorate of Machinery code compliance issue and had to review 180 welds in the pressure parts circuit, four of which had to be retrofitted – all additional work that had not been planned for. A second more serious problem arose when it was discovered that the subcontractor responsible for post welding treatment, a critical process in which welds are de-stressed, had fraudulently created charts in a sophisticated scam that left uncertainty as to how thoroughly the weld had been checked. In short every weld – 9,000 of them – had to be re-checked. The sophisticated fraud led to a criminal investigation and further delays. These technical problems have all been identified and addressed using well understood procedures that are part of any project management process. Medupi is a critical national asset, and any delay is to be regretted. However the labour relations issues are less predictable and negotiations involving powerful unions are sensitive in the run-up to national elections. What cannot be disputed is the fact that the project has been a great boost to the local manufacturing and economy. The Medupi power station project created a lot of skills development within the

country. “Once we started building Medupi and Kusile we effectively introduced a lot of manufacturing capability back in to South Africa,” Roman Crookes points out. “For example for the first time in 20 years we now have the ability to build boilers here in South Africa. Technically we can now export boilers, which is a huge step in the right direction.” Medupi’s local sourcing and industry creation policy has undoubtedly had a big impact

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Eskom Medupi

High voltage yard, air cooled condenser columns with boiler units and two chimneys

in the Limpopo region and nationally. The decision to build a third large power station, recently announced by the South African cabinet, will probably be implemented once the Medupi and Kusile projects are complete in 2018, adding a combined 9,600MW to the national grid. This should finally put an end to the electricity supply challenges that have affected South Africa since 2008, costing the economy billions of Rand in lost production and economic growth. Thus the social impact has been significant, to Crookes’ great satisfaction. “People are becoming employed for the first time; given skills for the first time; paid for the first time! And to sustain the impetus once construction is complete we have the Medupi Leadership Initiative where we work closely with the

contractors to produce opportunities for post construction employment in different infrastructure-related projects.” The third power station will eventually mop up many of the newly-skilled people, and there are other important upcoming programmes in the pipeline, he says. “The government has said it wants to place a rail hub in the Lephalale region. That will need a lot of civil and mechanical trades to build it and lessen the impact of unemployment on the local community once all the Medupi units start supplying power to the national grid.” For more information about Eskom Medupi visit:

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Cobre Las Cruces (CLC)

21 Century mining st

By maximizing its return on considerable investment in recent years Cobre Las Cruces (CLC) is well on the way to achieving its vision of becoming a benchmark standard in modern mining operations

written by: Will Daynes research by: Louisa Adcock

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Cobre Las Cruces (CLC)


Ariel view of mining operations

ocated at the eastern end of the prolific Iberian Pyrite Belt in the province of Seville, Spain, Cobre Las Cruces (CLC) is a highly innovative open pit mine and the first industrial installation of its kind to operate within Europe. Providing direct employment to 800 employees, as well as generating approximately 1,500 indirect jobs, CLC represents a major €840 million industrial investment into an area that also spans the Spanish provinces of Badajoz and Huelva, and extends through the south of Portugal. Exploration of the mine site commenced in 1992, with a complete site evaluation running from 1994 to 1999. June 2009 saw the start-up of production at the mine, which has an estimated lifespan of 15 years. “Since the production phase began,” states Plant Director, Enrique Delgado, “the growth of the business has been marked by the evolution of the site’s production plant, which has been steadily approaching its maximum output of 6,000 tonnes of copper cathodes per month, a figure which was just achieved in mid-2012. In 2012 alone we produced 58,000 tonnes of copper cathodes, with a resulting turnover of €425 million .” The hydrometallurgical plant is the heart of the operations and the key element of the complex. Unique to Europe, it is where the ore is converted into copper sheets following a process that offers clear advantages at a technical, economic and environmental level; in fact it is considered by the international mining industry as being a clean technology for obtaining copper. The finished result

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Moving toward the future! INSERSA


Mining and Tunnelling Drilling Civil Works Building Construction Paseo del Coso, s/n Minas de Riotinto (Huelva-SPAIN) Tel: +34 959 590 506 Fax: + 34 959 590 537

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

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is grade “A” copper cathodes with a purity of more than 99.999 percent, according to the London Metal Exchange. It is this that makes up the final product of CLC, ready for commercialization and transformation into rods or copper wire. Today the core focus of the business is to advance the asset to its next phase, which fundamentally means gaining access to new, under-developed areas of the site. As far as the production plant goes, the company’s efforts are focused on optimising its output. This is a task made all the more important by the fact that 2013 marks the first full year during which the plant will have operated consistently at maximum capacity. Other long-term plans for CLC include examining the possibility of the exploitation

Cobre Las Cruces (CLC)

Hydrometallurgical plant

of other complementary mineral resources containing copper deposits. Bearing this and the aforementioned on-going developments in mind, it explains why the company has endeavoured to invest consistently in its operations. “Once the major investment stage during the construction of the plant complex was complete we immediately began the process of undertaking important improvement works

elsewhere around the complex, including the construction of our water treatment plant,” Delgado continues. “By the end of 2012 investment in the mine and its associated infrastructure had exceeded €80 million .” While CLC does indeed work with many of the most qualified international suppliers, especially when it comes to the innovative technology used at the mine, it is a preference of the company to work with local suppliers

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who it considers to be every bit as valuable to the mine’s success. Similarly CLC has, since the start of the construction phase, given particular priority to the training of local professionals who join the business. “Today there are many individuals from this region that carry out functions in the business for which they have been specifically trained.” Delgado highlights. “Providing employment is however just one

way that our operation positively impacts the local economy. With many of our employees, as well as contractors, being residents in neighbouring areas around the mine it has helped create a large number of indirect jobs in all manner of services including hospitality and transport.” The concept of sustainability also exists as a high priority within CLC’s ethos. “As is the case with work safety,” Delgado says,

“First Quantum Minerals have already made it clear that they intend to invest more than €100 million into this project in the coming years”

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Cobre Las Cruces (CLC)

“with regard to the environment our belief is that prevention is better than cure. As such there are three key themes that we continue to work towards. These involve the progressive environmental restoration of the area in which we function, the total care of the water resources in said area and the absence of tailings ponds, which completely eliminates the well-known risks associated with such facilities.” Happily for Delgado, CLC’s employees and the suppliers and communities which benefit from the mine’s presence, the future of the development looks very healthy indeed. “Our owners, First Quantum Minerals, have already made it clear that they intend to invest

more than €100 million into this project in the coming years,” Delgado explains. “Furthermore, if the feasibility of additional mineral resource exploitation is approved, this would require additional investment to carry out such a project. However, if the current estimates are confirmed, we could be talking about expanding the mine activity between 10 and 15 years longer than currently planned, which will be great news for everyone.” For more information about Cobre Las Cruces (CLC) visit:

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A land of op

Monica Gichuhi, Chief Executive Offi (KCM), discusses how the country is Africa one of the most exciting new

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The Kenya Chamber of Mines (KCM)


ficer of the Kenya Chamber of Mines s playing a vital role in making East w frontiers for mining on the planet

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The Kenya Chamber of Mines (KCM)


t is fair to say that until recently Kenya and all service providers that wanted to was not generally renowned for being become involved with mining. This has led a destination for mining investment. to a situation where today we have gone from However now, with the world’s eyes having a membership portfolio that was once focused firmly on Africa as an epicentre home to exploration companies and mine for mining activities, Kenya is emerging as operators, to one that caters for those in the a location of particular interest in the wake legal, financial, consultation and equipment of developments that have proven that supply fields. This in turn has helped the country does indeed hold significant bring added value to the aforementioned mineral-based potential. explorers and operators, as well as any With the industry taking on ever greater foreign owned entities looking to enter the significance and the country receiving more marketplace, as they now have direct access and more interest from international investors, to a list of all manner of service providers that the creation of a dedicated can cater for their needs.” Proof of the rapid Chamber of Mines became development of the mining a necessity. “The Kenya sector in Kenya can be seen Chamber of Mines (KCM) throughout the country, from was established in the year the major breakthroughs 2000,” explains Chief The year that KCM being made at the Kwale Executive Officer, Monica was established Mineral Sands Project to the Gichuhi, “with its key purchasing of licences by mandate being to act as a representative for the private sector companies the likes of Barrick Gold in the last year, an operating in Kenya’s mining sector.” event which marked the entry of one of the At first KCM existed mainly as a lobbying best known global players into the country. body, pushing for more favourable working Such events have also resulted in an influx conditions for miners and private stakeholders. of junior miners coming into Kenya seeking However, in line with the growth in their own opportunities. These developments have clearly not prominence of the sector, the Chamber’s role has continued to evolve to take on a gone unnoticed and have helped lead to the number of core roles including the marketing Kenyan government establishing a dedicated of the industry locally and internationally Ministry of Mining for the first time in its to promote investment opportunities, history. “In the past mining had always been drive awareness of the industry amongst banded together in government with other local communities and be a source of natural resources or as part of environmental information for its members. discussions,” Ms Gichuhi states. “It is of huge “Over time,” Ms Gichuhi continues, “we significance therefore that it now has its own began opening up our membership to any docket within government, something which


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The Kenya Chamber of Mines (KCM)

“Kenya is emerging as a location of particular interest having proven that the country does indeed hold significant mineral-based potential” very clearly highlights the confidence it has in the positive benefits the industry can bring to Kenya in the future.” What is happening within government does not mean however that the role of KCM has diminished in any way. In fact it is perhaps more important now than ever before that the Chamber maintains the pressure it places on the powers that be to ensure that the proper legislation and regulations are in place to

properly support the growth of mining and attract investment. In addition to its lobbying for the legislation reform process to be speeded up and for the introduction of better tax conditions for the industry, a topic that is high on the Chamber’s agenda at present is the gathering of comprehensive geological data for the whole of Kenya, an act that will prove invaluable when it comes to attracting

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POWERING AFRICAN MINING For a mining operation to be viable, a number of factors must be in place. Sustained demand for the commodity, a market price that offers profitability, once extraction, refining and transportation costs are subtracted and a licence to operate are three such factors. Access to a robust, high-quality power supply is another. Without reliable power, mines simply cannot operate. Traditionally mine power has been supplied from accessing the local power grid or through independent power plants owned and operated by mining companies. Typically when relying on grid power, a fleet of back-up generators are also located on site to step in when grid power goes down. Another option for powering mines that is becoming increasingly popular is the rental of power plants for either primary or backup power. Mining companies are starting to recognise the clear benefits of outsourcing this vital, yet non-core activity to specialised suppliers. Rental power offers flexibility in capacity and avoids tying up large amounts of capital in the purchase and maintenance of power infrastructure. Further, it allows miners to concentrate on what they do best, while leaving the supply of power in the hands of dedicated power experts. “Over the course of a mine’s lifespan, power demands will increase incrementally and then decrease as the mine is scaled back,” commented Charly Wittgenstein, Area Sales Manager, Aggreko East Africa. “By renting power, miners can opt for exactly the power capacity they need and then grow or decrease this as and when required. This avoids the

costly situation of having either unused or redundant capacity or potentially worse, an insufficient power supply.” Aggreko is the world’s leading supplier of rental power to mining operations across the globe. From providing small generators to power initial exploration camps to powering entire mining operations with multi-megawatt power plants, Aggreko is recognised as the industry leader. With a network of eight depots across Africa, supported by regional hubs in Europe and the Middle East, Aggreko has the unique ability to service practically any power requirement, in any geography across Africa. “From our depot in Nairobi we can rapidly mobilise fleet to support our customers when emergency situations arise,” continued Wittgenstein. “Yet we also have the capacity and proven experience to supply large–scale and longer term power installations. Aggreko are an excellent partner for mining companies as we can support them at each and every stage of their operations.” Aggreko supplies temporary power and temperature control solutions across Africa and throughout the world to a wide array of heavy industries, government utilities and to international major events. With a local African depot network encompassing Nairobi, Johannesburg, Port Elisabeth, Cape Town, Durban, Walvis Bay, Luanda and Lagos, backed up by regional hubs in Europe and the Middle East Aggreko has an unrivalled ability to support our customers across the entire African continent.

The Kenya Chamber of Mines (KCM)

investors to take up licencing the reaction to the increase opportunities. “As of today we in mining activities and are still waiting to conduct operations from Kenyans a full airborne survey that themselves, particularly will map out the country’s local communities around Number of current resources,” Ms Gichuhi says. which said operations are members in KCM “This is something that we beginning to take shape. want carried out as soon as As KCM is well aware such possible and we continue to push hard for it to events can open the door to misinformation take place. In truth I believe the government of the positives and negatives of the is now starting to realise, thanks to the development of the industry spreading ever-growing amount of licence applications amongst local people, therefore it is one of it is receiving, the importance of such the Chamber’s key tasks to act as an accurate an undertaking, but we will continue to source of information and advice. lobby for it until it happens.” Of course the buck doesn’t stop there with It would be remiss to not also consider the Chamber. It also falls upon the mining


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TAITA TAVETA UNIVERSITY COLLEGE VOI KENYA Taita Taveta University College (TTUC) was established in 2007 as a campus of the Jomo Kenyatta University of Agriculture & Technology (JKUAT) but was upgraded to a Constituent College of JKUAT in 2011. With a student population of over 2,000, the University College currently has five schools. The flagship programme of the University College is the BSc in Mining and Mineral Processing Engineering (MMPE). In addition SEMTECH also runs short courses in Gemology. The importance of the BSc in Mining and Mineral Processing Engineering Programme continues to rise dramatically in Kenya following discoveries of commercially viable deposits of titanium minerals, iron ores, niobium and rare

earths, among others, and prospects of a major gold find soon on the heels of intensified exploration efforts. Shortage of engineering workforce to service the mining, oil and gas industries will continue to bite for many years to come not, only in Kenya but in the whole region of eastern, central and southern African nations. To enhance its educational training capacity, both in terms of academic staff as well as in terms of engineering infrastructure, TTUC has entered into partnerships with other reputable mining universities in Australia, Europe and Africa.


Taita Taveta University College is increasingly recognized as the Centre for the training of University level engineering workforce for the oil, gas and mining industries in Kenya. Our graduates come out having acquired competence and basic skills in design of both surface and underground mines, mine surveying, blasting with explosives in quarries, mines, civil engineering works, design of mineral processing flow sheets and Computer-Aided Design, among others. Services/programs • Technical advice to investors on mine design, mineral processing and extractive metallurgy • Research and Technological Innovation, including innovation geared at creating indigenous industries in the minerals, oil and gas downstream activities

• Offering Short Courses on Gemology, Gem Cutting, Jewelry Manufacture Marketing and other Value Addition processes • Community Outreach Programmes Other Courses offered at TTUC include the Following • Bachelor of Science in Information Technology • Bachelor of Science in Mathematics and Computer Science • Bachelor of Commerce • Bachelor of Purchasing and Supplies Management • There are also various Certificate and Diploma programs on offer For more information please visit:

The Kenya Chamber of Mines (KCM)

“Anyone wanting to become a member of KCM must be in full compliance with the laws and regulations that govern the environment” companies themselves to build and maintain a positive image for the sector. Where the Chamber does play a role in this is by constantly promoting the concepts of responsible, ethical and sustainable operations. “First and foremost,” Ms Gichuhi says, “anyone wanting to become a member of KCM must be in full compliance with the laws and regulations that govern the environment. Further to that, part of our own strategic

objective has been to develop a code of ethics for our membership which will see them ensuring their full compliance with issues surrounding environmental protection, community relations and corporate social responsibility initiatives.” When asked to look ahead to what the future holds for KCM, and the mining sector in Kenya as a whole, one of the first things on Ms Gichuhi’s agenda is the third annual

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“Kenya is undoubtedly one of the foremost reasons why Eastern Africa is now regarded as a new frontier for mining in the developing world” Mining Business and Investment (MBI) Conference taking place in October at the Safari Park Hotel in Nairobi. “The MBI Conference is one of the significant events on our calendar,” she enthuses. “It is here that we draw in a whole host of current and future investors, all of whom are keen

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to get a better understanding of mining in Kenya, what opportunities exist here, the challenges that we are working to overcome and what the government’s position is when it comes to supporting the industry, all of which makes for a hugely important event for all parties involved.”

The Kenya Chamber of Mines (KCM)

Kenya is undoubtedly one of the foremost reasons why Eastern Africa is now regarded as a new frontier for mining in the developing world. With the country’s relatively unexplored land playing host to a wealth of mineral based opportunities there is unlikely to be any slowdown in the near future when it comes to investors seeking out new projects for exploration and development. With that in mind Ms Gichuhi is keen to emphasise that there are long-term plans for the KCM to evolve and grow alongside the mining sector so as to continue fulfilling its mandate and obligations. “As well as positioning ours for the expected growth in membership that

the Chamber will receive going forward, we are also planning for the possibility of one day becoming part of an integrated Chamber of Mines and Energy. The bringing together of these two separate entities would bring Kenya in line with international standards and will help give both fields a larger platform for dialogue and one collective voice to represent the hugely important extractive industries in the country.� For more information about The Kenya Chamber of Mines (KCM) visit:

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Reliability in transport Kengas Group Limited started with bulk petroleum products before moving into supply and delivery services within the Great Lakes Region including Southern Sudan

written by: will daynes | research by: james boyle


engas Group Limited started with bulk petroleum products before moving into supply and delivery services within the Great Lakes Region including Southern Sudan. The company has over 25 years’ experience and operates in some of the most demanding locations. Kengas Group firmly believes in putting customers’ needs first, promoting equity within its ranks and re-investing its profits on tangibles that make a difference to customers. Bringing together the best minds and the best technologies, Kengas understands that having high standards is the driving factor of change in life. By bringing greater synergy to daily business, maximizing the efficiency of businesses and providing specialized services

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across countries, Kengas integrates continuous improvements to bring changes for the better. Kengas’ vision is to become the regions leader in providing specialized services in remote environments based on sound success in the oil industry. In its quest to do so the company strives to efficiently and reliably provide services that fuel the national economy, improve quality of life, create maximum value for its shareholders and stakeholders, and empower its employees. Distinguishing characteristics of the business stem from a combination of management experience, service experience and quality of service. Above all else, Kengas Group treasures the corporate values of integrity, teamwork, communication, achievement, compassion and understanding, in the people it employs.

Kengas group

Much in the same way as its employees, Kengas itself endeavors to always conduct itself according to a set of core values. These include its desire to operate its businesses safely and remain good guardians of the environment, and comply with environmental regulations. Integrity in the form of being honest and open with its employees, customers and stakeholders is another core value, as are trust and respect. Kengas Group is committed to fairness in the rewarding of employees on the basis of their performance and contribution to the organization. It recognizes diversity as a key strength, and works hard to foster an inclusive environment that will enable everybody to fully participate and contribute. Last but not least is competitiveness. Kengas aims to be competitive through efficient

and reliable operations, superior customer service, the adoption of best practices, seeking innovation and applying technology as a competitive advantage. Kengas Group today boasts a wide range of capabilities. These include fuel logistics and supply, cargo logistics, catering services, procurement, camp designing, construction and management, fleet management and ICT services. In addition to all of the above it is also able to provide warehousing, laundry services, consulting, contract logistics and other specialized services. For more information about Kengas Group visit:

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Simang Group

Strength in numbers By bringing viable businesses with strong growth potential under its wing, Simang Group is on its way to reaching its goal of becoming a platinum rated group of companies

written by: Will Daynes research by: Jon Bradley

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Simang Group


994 will undoubtedly forever be the whom emerged from adversity to establish year that mankind associates with the their own successful enterprises. modern South Africa. One does not In pursuit of its goal of becoming a need to be a historian to know that platinum rated group of companies Simang it was here that the days of apartheid Group has gone on to supplement its existing slowly came to end, resulting in the multi- capabilities through the aggressive targeting racial democratic election that brought and acquisition of other businesses. When Nelson Mandela and his African National it comes to these acquisitions, the group Congress (ANC) to power. provides leadership and strategic direction Nevertheless, the vestiges of apartheid still while the management of Simang Group shape South African politics and society to Subsidiaries is tasked with implementing the this day. One of the most important events business strategies of these companies. that was given rise by the events of 1994 Today, Simang Group’s primary goal is to was the launching of the Black Economic monitor the market in a number of sectors Empowerment (BEE) program. Launched in order to identify businesses that showcase to redress the inequalities of long-term potential and could the past the program gives eventually be brought under its umbrella of companies. previously disadvantaged In order to do this the group g r oup s of S out h will typically set about African citizens economic enthusiastically purchasing pr iv i leges prev iously The year Simang Group unavailable to them. majority shares in said was established While BBE, like virtually businesses, adding them all we l l -i nt e nt ion e d to the holding company’s programs, and other efforts from the ANC portfolio of assets. Once the deal is done, have come in for certain criticisms in the Simang Group then sets about transforming past, one cannot deny that it has resulted in the companies by applying its tried and a number of inspirational economic stories tested business strategies to the new projects in the hope of instigating growth and arising in recent times. One of those is that of the Simang Group, ultimately healthy profit margins. Although the interests the group a black owned and controlled equity investor interested in acquiring majority shares accumulates typically fall into a number in viable businesses with strong growth of highly diverse business categories, they prospects. Formed in 2008 through the soon become linked in the sense that they consolidation of the interests of a group each go on to profit from Simang Group’s of major shareholders under one roof, the modern approach, its well-known passion group’s founders consist entirely of previously for quality and its track record for embracing disadvantaged black South Africans, each of technological advancements.


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Simang Group In recent years the group has compiled what is unquestionably an impressive portfolio of assets, and today controls a host of companies from sectors including job recruitment, consumer electronics and property development. Each business invariably represents the continued economic prosperity being experienced in its field of activity. This is further highlighted by the group’s recent venture

into South Africa’s aviation sector, the most developed on the continent, with its acquisition of a 30 percent stake in ExecuJet. The largest business aviation company in Africa, ExecuJet boasts a charter fleet of more than 50 aircraft and world class facilities at both Cape Town and Lanseria International airports, making it widely regarded as the market leader in its field. Also central to Simang Group’s activities

CUMMINS POWER GENERATION Cummins Power Generation division is recognised as a world leader in the design and manufacture of pre-integrated generator sets, ranging from 8 kVA to 3300 kVA. All major components including engine, alternator, transfer switches and control systems are designed and manufactured according to the highest standards of quality set by Cummins. Power Command technology from Cummins Power Generation is an innovative way to ensure the equipment in a power system works in synergy from the start. It involves a pre-integrated design, rather than the combination of an engine, alternator, controls and transfer switches from a variety of manufacturers. The result of pre-integrated power solutions is smaller equipment footprints, reduced installation time and higher system reliability in regions that are regularly affected by constant and prolonged power outages.

For long and short term standby power needs, permanently installed and mobile power systems have been used across Africa by various hospitals, factories, office buildings, hotels, casinos and telecommunication centres. Cummins Power Generation has the ability to meet any demands for standby power, whether it is a simple diesel generator set or a complete PowerCommand pre-integrated power generation system. Current product development at Cummins Power Generation focuses on the reduction of engine and generator set emissions that can contribute to pollution and global warming. The Cummins range of power generation products and manufacturing processes are designed to lead to a cleaner and healthier environment, and comply with or surpass all international emissions standards.

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“Expansion and growth are going to be the big themes that drive the group forward in the coming months and years� and its corporate strategy is its steadfast belief in delivering corporate social investment. The company has a strategic objective focussed specifically on this area and has a number of corporate social investment initiatives running. These include its prestigious

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position as patron for the Gauteng Education Department Top Student Awards. This ethos also extends into other facets of the group’s business, not least of all its recruitment policy. Here Simang Group maintains a strong obligation and

Simang Group

commitment towards employing individuals who have had less fortunate upbringings. In doing so the group has learned that in providing its employees with the same opportunities that its founders enjoyed it is rewarded by a healthy combination of enthusiasm, professionalism and hard work, something that acts as a perfect foundation for the group going forward. While the economic climate of 2013 certainly differs from that of 2008, prior to the onset of the global economic crisis, Simang Group has managed to weather the storm so to speak and continue to

expand, with its combined workforce of approximately 1,000 people set to grow further still by the end of 2013. Expansion and growth are going to be the big themes that drive the group forward in the coming months and years, all while it continues to ensure that its companies remain profitable, competitive and provide quality products and services. For more information about Simang Group visit:

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Issue No.66


Issue No.66