PEOPLE, PRACTICE & PURPOSE QUARTER 1 2016
KARAHMAA
IN THE RIGHT DIRECTION
SEAFARMS GROUP
PLANS TO LAUNCH AUSTRALIA INTO A AQUACULTURE LEADER
WESTPORT
ADOPTS ALL INCLUSIVE OBJECTIVES OF ECONOMIC RETURNS, PRODUCTIVITY AND SUSTAINABILITY
COPPER MOUNTAIN MINING CORP REVIVING LOCAL ECONOMY
EDITOR’S NOTE TEAM Editorial: Brian Jackson Susette Horspool Mark Mackay Production Karen Hue Jason Olayinka Arantxa Salas Cifuentes Arabella Sansegundo Mulero
Editor’s Note Brian Jackson
Research John Mills Joseph Philips
Editor
Hello and welcome to this quarter’s edition of The Sustainable Business Review online. With some respected commentators suggesting that the world’s economy is likely to go through yet more tough times, we are delighted to showcase a host of companies whose business platforms and approach to corporate social responsibility and sustainability clearly demonstrates that they are in a solid position to weather any potential economic and financial storm and indeed will be able to consolidate and build their businesses. Our cover story is Copper Mountain whose strategy of maintaining a low risk profile through project diversification and astute financial management allows them to successfully operate in torrid times for large sectors of the mining industry. We are also pleased to feature a young and dynamic company called Qatar Cool. This company centralises cooling systems of buildings throughout the region and enables the saving of carbon emissions and reduces energy use by up to 60%, whilst lowering noise pollution. A truly remarkable success story. As with previous editions, we love to celebrate the diversity of industry and companies across the globe and alongside Copper Mountain
and Qatar Cool we also turn the spotlight on IOS Geo, a Quebec based team of highly experienced and qualified geologists helping mining companies with mineral exploration throughout Canada, Barbados Port , a major gateway for the economic health of the region , Health City Caymen Island a visionary project spear heading medical tourism and providing cutting edge medical treatments in the Cayman Islands , to Seafarms , the largest producer of farmed prawns in Australia . These are just a few of the featured companies in this edition. A prevalent and common theme running through all of the companies featured is their outstanding commitment to corporate social responsibility, sustainability and of course the bottom line. These three over riding factors are embedded in the company’s value systems and stands the min excellent stead should trading conditions prove to be difficult. We hope you enjoy this quarterly edition and should you wish your company to be featured, whether it be for example a particular innovation, a record sales year, an initiative in sustainability or CSR, we would welcome the opportunity to celebrate your success!
CONTENTS QUARTER 1 2016 SPECIAL REPORT:
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COPPER MOUNTAIN MINING CORP
pROFILE:
18 30 42 50 58 68 76 88 96
IOS CERRO NEGRO PORT OF BARBADOS HEALTH CITY CAYMEN WESTPORT SINGAPORE’S PUBLIC UTILITIES BOARD (PUB) KAHRAMAA QATAR COOL SEAFARMS GROUP
Brian Jackson
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THE SUSTAINABLE BUSINESS REVIEW
EVENTS:
ALTA 2016 NICKEL-COBALT-COPPER, URANIUM-REE AND GOLD-PRECIOUS METALS CONFERENCE & EXHIBITION
May 21, 2016 - May 28, 2016 Perth, Australia Pan Pacific, 207 Adelaide Terrace
Three international conferences in one week
ALTA 2016, organised by ALTA Metallurgical Services, will be the 21st year of one of the world’s premier annual metallurgical events. The conference is an annual gathering of the global Nickel, Cobalt, Copper, Uranium-REE and Gold-Precious Metals industries and features highly focused programs, topical forums and presentations by key international speakers. The event comprises:
• Uranium-REE Sessions including Membranes in Uranium Ore Processing Forum & Panel
• Nickel-Cobalt-Copper Sessions including Hydromet Prºcessing Sulphides Forum & Panel
• Gold-Precious Metals Sessions including Refractory Gold Ores Forum & Panel
Three Short Courses • The A-Z of Copper Ore Leaching • Solvent Extraction and its Application to Copper, Uranium and Nickel-Cobalt • Uranium Ore Processing
THE ECONOMIST:
THE SUSTAINABILITY SUMMIT Date: March 15-16th 2016 • London Venue: The Banking Hall, 14 Cornhill, EC3V 3ND The climate deal struck in Paris last year surpassed expectations. More world leaders gathered to see it through than had ever met together before. The deal came hot on the heels of a global agreement on a set of new “sustainable development goals”. But how, in practice, are these lofty aims to be achieved? And what role should businesses and investors play in shaping new thinking and turning ambition into action?
Speakers: Alejandro Agag :-CEO, Formula E, Brett Begemann -President and Chief Operating Officer, Monsanto, Per BolundMinister for Financial Markets and Consumer Affairs and Deputy Minister for Finance, Sweden. And lots more Join the conversation @EconomistEvents #EconSustainability http://www.economist.com/events-conferences/emea/sustainability-summit
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NEWS
FUTURE FISH EUROASIA
MIDDLE EAST & CENTRAL ASIA AQUACULTURE
JUNI 2-4, 2016 TURKEY, Izmir Venue: Fair Izmir Expo Center in Izmir, Turkey. Future Fish Eurasia, the 8th International Fair for Fish Imports/Exports, Processing, Aquaculture and Fisheries event. Future Fish Eurasia is organised with the full support of the Ministry Of Food, Agriculture & Livestock, Aegean Exporters Association, Turkish Seafood Promotion Committee, the leading companies of the industry and the universities.
Local Organisers Asoc. Prof. Dr. Özgür Altan (Fisheries Faculty, Ege University, Turkey) Dr. Türker Bodur (Fisheries Faculty, Akdeniz University, Turkey) For More information: www.future-fish.com
INDABA 2016 Date: 7-9 May Venue: Inkosi Albert Luthuli Convention Centre (Durban ICC), Durban Exhibition Centre (DEC), KwaZulu Natal, South Africa. Show Days: 7 - 9 May 2016 INDABA is one of the largest tourism marketing events on the African calendar and one of the top three ‘must visit’ events of its kind on the global calendar. It showcases the widest variety of Southern Africa’s best tourism products and attracts international buyers and media from across the world. INDABA is owned by South African Tourism and organised by Pure Grit Project and Exhibitions Management (Pty) Ltd
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THE SUSTAINABLE BUSINESS REVIEW
CATEGORY
THE SUSTAINABLE BUSINESS REVIEW
COPPER
MOUNTAIN M
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REVIV
COPPER MOUNTAIN MINING CORP
In
2013 Copper Mountain Mine’s gross profit for the year was $8.1 million. In 2014 the reopened mine, now the third largest in Canada, produced a record 81 million pounds of copper, 22,600 ounces of gold, and 443,800 ounces of silver, generating a record revenue of $265 million for the year. The newly lucrative copper mine is a 20–minute drive from local communities, like Princeton, British Columbia, that provide it with goods, services and personnel. These communities, existing until recently on work stemming from the declining forest industry, welcomed the reopening of the mine, which has already added hundreds of millions of dollars to the area’s economic base.
MINING CORP
VING LOCAL ECONOMY
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THE health and safety of its 240 employees is one of Copper Mountain Mining Corporation’s sustainability objectives,
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the other being environmental management, according to the company website. With the reopening of the mine in 2011 the company took action on those two goals. In 2014 it won BC’s Edward Prior Award for a combination
COPPER MOUNTAIN MINING CORP
of high production and low accident rates. The company’s record, as of that week, was 1.5 million hours worked without any safety incidents that cost the workers time off.
of April, the mill has operated at record rates and throughput averaged 39,800 tpd. We have a strong operating team and I am confident that the team will continue to maintain their great safety record while they continue to maximise production.”
THE heritage mine reopened when exploratory tests showed that its veins of copper, gold, and silver went far deeper than anyone realised. Prior to that, high grade copper had been mined from shallow open pits in three main locations, which were abandoned when costs became too high. As a result of the new assays, the company decided to mine deep into the area between those shallow pits and expand its width to include them. This expanded and deepened mine is expected to last around 17 years and be highly productive. Copper Mountain Mining first acquired the 18,000 acre property by purchasing Similco Mines in 2007, and immediately started a geophysical survey that included a 44,000 metre drill program. The following year they finished drilling an additional 60,000 metres, which showed a total potential of five billion pounds of copper, plus secondary amounts of gold and silver.
Copper Mountain’s President and CEO, Jim O’Rourke, responded to the award, “I congratulate our mine employees for their dedication to safety . . . During the first 19 days
In 2008 they also completed an independent economic feasibility study (Hatch Engineering) that confirmed the financial viability of reopening the mine. That year they joined forces with Japan’s Mitsubishi Materials Corporation to
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THE SUSTAINABLE BUSINESS REVIEW help with financing and to purchase 100% of all copper mined. In 2009 Mitsubishi bought 25% ownership of the project. The area was originally mined underground, starting in 1884. In 1923 a milling facility was added nearby and underground mining
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continued until 1957. In 1968 open pit mining started, which continued until the mine closed in 1996. By that time the mine had produced over 1.7 billion pounds of copper.
COPPER MOUNTAIN MINING CORP Copper Mountain Mining is operating the expanded mine using open pit technology. The company set up a mill onsite to handle increased production and bought $120 million worth of new mobile equipment. The new fleet consists of 13 brand new 240 ton haul trucks (bringing the total to 21), five 260 ton haul trucks, two Komatsu PC 8000 hydraulic shovels, the
world’s largest mechanical loader, four rotary drills, and a fleet of support equipment. In 2014 the company installed a secondary cone crusher in its onsite mill, the Raptor 2000 (the world’s largest), thereby increasing production speed and efficiency to 37,500 tons per day. Because of its prior operation, the mine already owned water rights and had a 158 kV power line to supply electricity, which helped keep costs low. Even so, capital costs came up to $438,000,000, which Mitsubishi helped acquire from Japanese banks at very attractive interest rates, according to O’Rourke. He said, “Having a developed infrastructure considerably reduces the construction risk and also the capital cost.”
All the mine’s equipment is used in the conventional production process of crushing, grinding, and flotation to produce copper concentrates laced with gold and silver. The company prepares the higher grade copper for immediate shipment from Vancouver to Japan for smelting, and transports lower grade slag to stockpiles for future processing using more sustainable methods, once developed. The slag is transported via a one kilometre long conveyer belt to save fuel costs. Some additional savings have come from upgrading the quality of the roads to save wear and tear on vehicle tires. Each tire on the haulers is worth about $42,000 and each hauler has eight of them. The tires are also difficult to acquire. Prior to the road upgrade they were lasting about four months each, but now are lasting eight. The company is also working with explosives suppliers and others to find more efficient ways of operating.
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When the world looks to you Look to Petro-Canada Lubricants It’s operations like yours that are leading the way in mining. And it’s lubricants like ours that can keep it that way. Petro-Canada brings over 30 years of mining experience to the development of a full suite of products to help keep mines like Copper Mountain running consistently and profitably. We believe that reducing downtime is more than a promise; it’s a commitment to delivering our Tangible Savings Solutions shift after shift. Call a Petro-Canada representative today to discover how our top-performing lubricants will maximize uptime and productivity for your mining operation. Call 1-866-335-3369 or visit lubricants.petro-canada.com
Petro-Canada is a Suncor business TM
Trademark of Suncor Energy Inc. Used under licence.
COPPER MOUNTAIN MINING CORP With its utilities the mine reclaims 78% of its wastewater for reuse in production, while obtaining fresh water from the Similkameen River. Electricity comes from a 61 megawatt VC hydro substation.
All mining operations are automated and monitored from a central control room, including a vehicle dispatch system, with computer screens that show each step of the operation. The mine operates 365 days per year, day and
At the heart of every mine beats the machinery that keeps it running. Petro-Canada Lubricants is dedicated to providing high-performance solutions to protect these vital components for industry leaders like Copper Mountain. Petro-Canada Lubricants is an integral part of the Copper Mountain operation, ensuring mine operations and special projects avoid unplanned downtime. “What really sets Petro-Canada Lubricants apart is their experience in the mining industry, their understanding of our equipment and their local support to help us while we got started, and ongoing,� explains Tom Blake, mine maintenance superintendent at Copper Mountain. With an extensive line of proven products, Petro-Canada Lubricants is the partner Copper Mountain trusts for all of its lubricant needs.
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THE SUSTAINABLE BUSINESS REVIEW night, even when it snows. These practices have resulted in the record production for the company that benefits the mine’s neighbouring communities. Former mining human resources officer, Frank Armitage, now 71 years old and the mayor of Princeton, who put together the initial 270 worker crew that reopened the mine, says that local communities are flourishing. Says Armitage, “Princeton suffered for a number of years, and now it [the mine] is a real foundation block to our economy.” In addition, the mining company is committed to working in harmony with the government, the public, First Nations, and other stakeholders to increase understanding of company activities relative to environmental protection. One of its former Vice Presidents (now Environmental Consultant), Peter Campbell, has years of experience managing environmental assessments and permitting for the Red Chris Project, Huckleberry Mine, and the early years of the Similco Mine.
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COPPER MOUNTAIN MINING CORP
“Our people are our greatest asset.” CEO O’Rourke says. “We believe we’ve built an extremely strong team and this will bode well for the future.”
As proof, his staff are developing operating efficiencies, which he believes are key to the mine’s success. They’re continuing with new explorations, digging 200 metres below the current 350 metre deep design pit, to increase production in the future. They’re looking out for safety issues and encouraging suppliers to become more efficient too. What more could the company and its communities ask for?
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IOS
IOS
Services Geoscientifiques, Inc
HOW TO BE THE LEADING FIRM
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THE SUSTAINABLE BUSINESS REVIEW IOS Services Geoscientifiques, Inc. is known
employees, clients, and the company itself.
as the leader in mineral exploration services in Québec, the most favorable juridiction in Canada
In 1992 CEO Réjean Girard and five other
for mining. How comes a
firm established
master and Ph.D. students started IOS Services
outside the prolific Abitibi area or the big financial
Géoscientifiques. Being located in the frenchmost
centres can establish itself as such? Simply
part of Quebec, they initially focused on that
by broadening its offering and by capitalizing
relatively small market by offering a wider variety
on its most precious asset: its talented human
of services, rather than specialising and tackling
resources! Easy to say, in fact everybody say
the large North-American market. The strategy
so! But the challenge is to maintain your talent
paid off. Specialized firms are very severely hurt
through the whirlpool of an industry driven
by recession, when their specialty get out of
by disruptive burst and bust cycles. And they
fashion.
do so by preparing ahead for these inevitable cycles of
the mining industry, even through
economic downturns. This preparation creates a stable, sustainable environment that benefits
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IOS is now the largest and most diversified business of its kind, both in Quebec and in Canada. Even in the midst of the worst recession
IOS in 40 years, it still employs 40 full time staff, 70%
magic trick as well as the challenge! Pooling a
of whom are scientists by training. While most
community of employee with a broad spectrum
of its business is domestic (80%), it now lure the
of talents and expertise enable cross-breeding
national market. The company has carried out
of the knowhow which benefits to all levels the
1,350 projects so far, for hundreds of clients,
services. Field expertise on various mineral
both juniors companies, multinational firms and
deposit is transmitted to the petrographer, which
governments. And strategy remained the same
benefits the geochemist, etc. Being exposed
through the years, the broad spectrum of services
to a vast array of projects, with any imaginable
enable the firm to reach a very diverse clientele,
commodities such as gold or iron or graphite or
and once in the while one of these clients comes
even limestone, opens the minds of the geologists
with the big mandate.
and enable them to think out of the boxes where other stay in their ruts.
The capability to offers a wide spectrum of services, from thin section manufacturing to full scale resource definition drilling, is the
Booms and
Busts
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THE SUSTAINABLE BUSINESS REVIEW Mining is a boom-and-burst driven industry at an unimaginable scale. The biggest challenge a service company like IOS faces is learning to navigate economic cycles. And these economic cycles are now even shorter than the time required to develop a mine. Furthermore, most mine life are now barely longer than these economic cycles. Mining is driven by speculation on commodities, which is short-term in nature. This brings periods of follies and severe drought. And when the doldrums knock at the doors, most mine managers panic and slash into exploration expenditure, assuming they will be capable to simply buy-out the resources they need at the appropriate time. So when the ore runs out everyone is exploring at once without having the properly trained staff. This is what creates the main boom cycle in the mineral exploration industry. And the first to suffer these cycles are the people working in mineral exploration. These cycles create an exodus of the talent, and everything needs to be rebuilt at each cycle. However, it takes years and years to train a geoscientist... And this is where is hidden our secret recipe... Maintaining our skilled workforce ready at any cost for the next boom. Because the money made in boom time overwhelmingly compensate for the losses of the doldrums. With experience, we can fairly predict upcoming boom cycles by watching industries that use the metals. For example, as the renewable industry picks up, the need for copper wire grows. A hybrid car uses 200 pounds of copper, as compared with 40 pounds used by the average car. Utilities also use copper wire. So the copper industry will boom as more and more countries swing toward green infrastructure and green products. Same with all the exotic metals used by the battery industry such as lithium, vanadium or graphite. Meanwhile, RĂŠjean says, the entire mining industry is in a deep recession - worse than the last 45 years and he sees indications that the recession is artificial. Exploration expenditures outside of mine site are horrible, at 8% of what
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IOS
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THE SUSTAINABLE BUSINESS REVIEW it was four years ago. And in paradox, prices
makes profits and there are investors capable to
of metals are correct considering they are prized
bank big money on gold.
in overinflated US dollars. For example, at US$1,060 per ounce of gold (C$1,600), when the
One of the problem of the exploration industry
price of oil collapsed and when labor, electricity
is access to capitals. These companies raise
and other cost are in Canadian dollars, it do not
their money on the stock market, where the
affected the mining industry that much. Yes the
small capitalization companies are devaluated.
metal price collapsed, but from a ballooned price
Why investing in a small cap penny stock if blue
down to a sustainable price!. Yet the miners
chips stocks provide 20% per year return on
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IOS investment? Because the Dow Jones is out of balance with the profits of the big corporations, and because the mining juniors are so devaluated that any market wrinkle will boast them! Things could change quickly, according to Réjean. The
whole situation is volatile and unpredictable. Just be ready! During troubled times like this, a proactive government can help prop up the industry. In
May 2011 the government of Quebec passed “Plan Nord” to develop the scarcely populated area of Northern Quebec. The plan encourages mining and provides numerous incentives to resource companies. The government also helps reduce costs by offering substantial income tax credits for mineral exploration. So, even the government consider its time to invest in our resources... Accordingly, in 2015 a third of IOS’s revenue came from research projects for the government’s Department of Natural Resources. In addition, IOS actively networks with many of the leading geoscientists in the province’s universities and national laboratories. This type of work represents one of the company’s survival strategies and a cornerstone for innovation.
IOS Sustainability
Strategies
IOS is the only service company in Quebec that effectively carries out the entire mineral exploration process. This is a big difference from what we see in the rest of Canada. Québec is a small market, isolated by its language and culture. You cannot built companies on specialized services in Québec, the market is simply too small. So we need to fill-in every niches. In doing such, we can touch a very broad base of client. As the mining industry grows, IOS identifies new niches and jumps in to fill them first, thereby keeping its lead over competitors. And through time, we can capitalize on our reputation and establish ourselves with a few highly specialized services which can be
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THE SUSTAINABLE BUSINESS REVIEW exported to the rest of the country despite our language handicap. An example is out new “ARTGold” process, which enable to recover micron-size gold particle from sediments, a technique broadly used in the gold exploration. However, our process enable recovering gold grains an order of magnitude smaller than the leading competition, which enable to client to reduce sample size and thus overall costs. It’s a million dollar R&D investment, but it will pay back soon. Another example is the partnership we developed with BearingPoint, a leading business management firm, in regard
currently one of the only firm in the world with this capability. A third example, talking green, we developed a modular heating system for isolated camp based on heat exchanging from lakes. It just creates 80% saving on fuel, the third largest expense on exploration program! In brief, a company could be built on a single of these innovations, and we are piling them! Such innovation-driven approach also brings to us a pipeline of innovative exploration projects. As example is the vanadium deposit we work with VanadiumCorp Resources. Vanadium can be used as a very efficient electrolyte for fuel cells. And when we say fuel cells, we talk about electrical grid stabilizer, megawatts-hours batteries! We bullishly work with our client on this green project since years, convinced this is one of the solution to the energy crisis. This technology should trigger a huge boom in the ever-growing renewable industry and a subsequent boom in vanadium production.
of applying artificial intelligence to mineral exploration. We adapted their “Hypercube” rare event prediction software to GIS based system, and you would be surprised on how powerful are its predictive capacity! We are
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The Sustainable Business Review - Quarter 1 2016
Surfing the
cycles
Boom and burst cycles are hard on the industry, but more even so on personnel. Most worker
IOS
cannot cope with such, they have family to feed and need stable incomes. And this is where we have to innovate in our managerial approach. Simply carry off-cycle R&D. Doing such, and since our staff has scientific training, we launch research and development project when the work load diminishes. This enable us to keep talented staff at work, stimulate their creativity, preparing the offering for the next boom and maintaining the skill ahead of competition. When the boom comes back, they are ready with exclusive and updated skills. As example, we set money aside within the local university fundation, which we use to support our professional going back for graduate studies! Summer/winter cycles creates similar short-
scale mini-boom/bust. Consequently, most service providers to exploration companies hire temporary workers to collect samples in the summer, and lay them out during winter. Inversely, laboratory have to process during winter time the huge loads of samples collected in summer. So IOS trains its staff to handle both. This strategy provides year round work for staff and increases their skills - allowing the field geologist to understand the entire exploration process and improve the quality of their decisions. It also helps stabilise the company and retain staff, enabling the company to constantly adjust. As a result, RĂŠjean says, “We have the highest seniority in the industry in Quebec . . . even
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THE SUSTAINABLE BUSINESS better than multinationals. This speaks by itself! “ During boom times IOS works feverishly to complete as much work as possible. These are times where income more than repays the expenses of down times. During down times the company prepares for booms by developing new niches and enhancing the skills of its specialists. During the summer, staff primarily conducts field work (e.g. gathering samples). During the winter they do lab work (e.g. analysing samples and making predictions). And overall, the whole thing balance and the worker have stable jobs!
Results of
Strategies Keeping skilled staff results in a company being able to flesh out ideas that competition is not able to. And these benefits are transmitted to the client and the whole community. It create an efficient work environment! For example, IOS realised that using helicopters to serve remote areas was not always financially smart. A single helicopter can burn about 500 drums of fuel in a sole program. This is four big lorries of drum, just to fly around the mining camps. Réjean declared, “We can do much better than that.” and we started working with a local machine shop, ALL Technologie Inc., who developed a revolutionary trackmounted, rough-terrain vehicle that floats, enabling it wander with ease without footprint in the Canadian barrens. The vehicle, called KASKOO, uses only 10 litres of fuel per hour, as compared with one drum of fuel per hour for a helicopter. This is 90% fuel saving on a
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The Sustainable Business Review - Quarter 1 2016
IOS per kilometre basis! And it can replace the helicopter in about 30% of the projects. This vehicle is now on the market. Ecology shall meet economy! Another example, by bridging exploration geologist, geochemist, mineralogist and biologist, we developed a geochemical method capable to “see” though thick overburden, such as the Northern Abitibi clay belt. It took us more than 15 years to come to a workable solution, but now we have it and we are the only ones! Each of these geochemistry projects require to put at work a team including field geoscientists, logisitic guys, laboratory technicians and artificial intelligence specialists! Its an ecosystem, from trucker to Ph.D.
degree program consisting of short courses presented by industry professionals with vast experience including Réjean himself. • Presenting abundant technical talks in conventions and discussion groups. Because ideas spawns from discussion. Expecting even more difficult years ahead? Yes! And Réjean is determined to keep the company’s key employees within an innovative business culture. They are, in his words, “the biggest asset we have. They’re not just dollar sign on the balance sheet. That’s the people who do the work.”And will the competition try to copy us? So what, we will innovate again! “
On the community side, sustainability has to be interwoven with day to day practice. It’s a state of mind we have to create, and the cornerstone is education. Therefore, IOS is working to improve the overall skills of workers in the industry, to transmit its knowhow. They have several programs that help senior professionals pass on their practical knowledge to younger workers: • Paying tuition fees, about $2,000, to university students they’ve hired during the summer (more than 200 so far). • Sponsoring graduate students to do precompetitive research and development, then subsidising them to continue their studies and hiring them afterward. • Collaborating to a professional masters
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THE SUSTAINABLE BUSINESS REVIEW
New Sustainable
Gold Mine in Argentina
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CER
NE
RRO
EGRO
CERRO NEGRO
In 2013 the international Canadian mining company, Goldcorp Inc, began developing the underground portion of a new gold/silver mine in Argentina. During its 2014 development year, Cerro Negro produced 152,100 ounces of high quality gold, with the final quarter’s production of 133,100 ounces being the second highest of any other Goldcorp asset. This averaged out to a 91% average recovery rate - highly desirable for a gold mine. In January of 2015 the company declared the mine open for commercial production. During this year the company expects to produce 425,000-475,000 ounces of gold. Cerro Negro is only one of several new development projects in the Patagonia area of Argentina. The company’s Project Director, Alastair Still, believes that its mine will soon be making a valuable contribution to the local and national economy. In fact, the collective production of all these new developments is already putting Argentina on the map as a leading mining country in South America and also globally.
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THE SUSTAINABLE BUSINESS REVIEW
Goldcorp purchased Cerro Negro and its 215 square kilometre site in 2010. By the end of 2014 the mine’s mineral reserves had been estimated at 5.26 million ounces of potentially high quality gold. The mine’s physical location is ideal (Patagonia Plains in Santa Cruz, Argentina). It contains easily accessible veins near the earth’s surface that are easy to approach and that help keep the cost of production low. Based on the minerals found in each, the Cerro Negro mine is divided into six zones, some aboveground, some below. To extract from the open pit mines, the company uses conventional drill and blast techniques. To extract from the underground mines, the company uses the blast-hole method. With careful management and sustainable practices, Cerro Negro is expected to produce for at least 12 years, if not more.
During 2014 Goldcorp also rolled out a new, core program called Sustainability Excellence Management System (SEMS). All six pillars upon which the company functions in its organisational structure, responsibilities, practices, procedures, processes, and resources are being scrutinised to make sure they are sustainable, and resulting practices are being incorporated into the Cerro Negro mine.
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CeRRO NEGRO
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THE SUSTAINABLE BUSINESS REVIEW
Goldcorp President and CEO, Chuck Jeannes, believes that enhancing corporate performance with sustainable business practices is “doing well and doing good at the same time.” The company’s commitment includes working with business partners that share environmental stewardship and corporate social responsibility principles. Company employees are also expected to contribute.
Jerry Danni, Senior Vice President of Sustainability, says that the company has incorporated sustainability into its core business at all levels, “so people understand they have a role to play in implementing our sustainability program.” He notes that the different aspects of sustainability, like health and safety or the environment, have traditionally been viewed as separate responsibilities, hence as “someone else’s job” but the company is changing that. In less than one year, the company’s more rigourous monitoring and reporting system resulted in its being named to the NASDAQ Global Sustainability Index, in addition to receiving other awards.
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CATEGORY
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CeRRO NEGRO As with most mines, Cerro Negro does not operate in a vacuum. It is surrounded by local communities that provide workers and support their health, and grow as the mine grows. Goldcorp is very aware of the impact their mines have on these communities and is determined that it be a positive one.
The company’s website states that, “Directly and indirectly, our presence has measurably reduced local poverty and improved employment, livelihood, education and health.” This statement may apply to the company as a whole, but it’s clearly what the company also intends for Cerro Negro.
The impact includes supply and service companies that establish themselves locally or are able to grow stronger by supporting the mine. Some of the companies (both local and international) that have contributed already to Cerro Negro’s production are: Normet International, BSI Group México, S. de R.L. de C.V., Tecin, Cirigliano SA, Trax Sur Logistica, Tronador, Golder Associates, Modular Home SRL, SONDA, BSI Group Mexico, and TDS Ingenieria S.A.
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THE SUSTAINABLE BUSINESS REVIEW •Engaging with communities Realising that the impacts Cerro Negro has on its surroundings can bring both opportunities and issues of concern, the company communicates with local stakeholders to understand and address their issues. They aim to conduct business in a way that the mine’s impacts will help its communities become strong, vibrant, and sustainable. This approach was tested in September 2015, when miners walked out for five days due to company conflicts with land management. The company petitioned and was granted a 15 day work period wherein they could work together toward conciliation. The company believes that treating communities with a “shared value” approach reflects mutual respect, and this conflict is giving them a chance to prove that. • Keeping company employees safe This is the company’s top priority, which makes economic sense as well, since fewer days lost to injury also means lower costs for the company. In 2014 there were no fatalities in any of Goldcorp’s mines. To help achieve this goal the company established a Day of Remembrance that recognises the lives of those lost in the past. They used it to increase awareness of safety issues and practices.
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CeRRO NEGRO
• Protecting the environment Goldcorp is committed to eliminating or mitigating negative impacts on the environment wherever they mine. The SEMS program integrates international standards and benchmarks for the environment, for safety and health, for Corporate Social Responsibility, and for security. All of their operations, including Cerro Negro and the company’s second new mine, Eleanor, are expected to follow the guidelines. In 2014 the company audited five of its existing sites using SEMS standards, including two less productive mines sold by the company this year.
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THE SUSTAINABLE BUSINESS REVIEW
As part of its long term environmental strategy, Goldcorp is aiming for low energy use and protection of the local watershed for each mine it owns. It plans to increase energy efficiency by 15% company-wide, reduce greenhouse gas emissions by 20%, and be generating a minimum of 5% of its energy from renewable sources by the end of 2016. For now, mining operations at Cerro Negro are powered by a new overhead transmission line from nearby Las Heras to a substation at the processing plant.
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The Sustainable Business Review - Quarter 1 2016
CeRRO NEGRO
The SEMS program has also become a springboard for Goldcorp’s new Water Stewardship Strategy that assigns conservation performance targets tailored to each site. At Cerro Negro water comes from three water bores located in the valley around the mine site. To protect the watershed during the mining process, Goldcorp installed a bitumen geo-membrane lining (developed by Siplast and installed by icopal) that covers 600,000 square metres of soil. These are only some of the ways in which Cerro Negro and its employees are impacting the communities and environment around them. There will be more. As Danni says “It’s our obligation as a company to be responsive to our shareholders, employees, partners, and the communities where we operate, so we can create a sustainable legacy for future generations.”
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THE SUSTAINABLE BUSINESS REVIEW
BARBADOS
THE ATTRACTION OF THE
Port of
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T
PORT OF BARBADOS he island of Barbados is an annual attraction for European and other tourists taking cruises to the islands of the West Indies. Its location east of all the
other islands makes it a natural gateway to Europeans. It has a higher standard of living than most of the other islands, with tourism being a major contributor. Barbados is also a major port of call for container shipping into and out of the Caribbean Sea, which includes the islands of the Caribbean and the northern countries
of
South
America.
Both cargo and cruise ships stop and are served at the award winning Barbados Port run by the island’s government corporation, Barbados Port, Inc. In addition to providing great berthing efficient
spots
and
service
friendly, Barbados
Port is an access point to the many attractions of the island that
demonstrate
sustainable
ecosystems (not to mention the finest rum drinks in the world.) The island’s attractions include a preserved coral reef used for research, great ocean dive sites, its world renowned horticulture, and
its
top
attraction
-
a
crystallised limestone cave, first discovered in 1795. The port, itself, features good security and efficient cargo operations, gives a great first impression for tourists, and ensures employee health and safety. The Port Authority and its partners work hard to educate and monitor staff to provide these services and more.
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THE SUSTAINABLE BUSINESS REVIEW
Barbados Port History & Size Barbados has been running cargo for over 50 years and cruise operations for more than 30 years. The Port Authority was created about 10 years before that from a merger and nationalised in 1992, then corporatised in 2003 to become Barbados Port, Inc. (BPI). The port’s first expansion in 1978 gave it a container berth, park, and a bulk handling facility. In 2001 the Port used dredging materials to connect with small Pelican Island and built facilities for cruise ships. The global economic downturn in 2008 resulted in a decrease of business, so the Port Authority decided to use the downtime to upgrade and prepare for the future. In 2011 the Port
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The Sustainable Business Review - Quarter 1 2016
installed an electronic trade logistics system for cargo, and in 2013 built another pier and ancillary facilities for the cruise ships. An equipment upgrade followed, as did special training to upgrade employee skills. Now the port is ready for the world’s economy to pick up. By 2012 there were 1,534 cargo ship calls moving over one million tons of goods. In 2014 the port hosted 395 cruise ships with 557,898 total passengers. An increase of 1,164 passengers from the year before chose to stay on the island for a week or more - great for the hotel and travel tour businesses. January of 2015 showed the highest number of that month’s visits in 15 years.
PORT OF BARBADOS
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THE SUSTAINABLE BUSINESS REVIEW
Most of Barbados’ visitors come from Europe. As the European economy continues to recover, the Port’s marketing arm will increase its marketing efforts to attract visitors during the slower summer and fall months. This includes visitors from the U.S. and Canada, which are also picking up. In the process, the Port is forming stronger alliances with online travel agencies and tour operators. In order to keep all of these visitors safe, the Port has been addressing the spectre of terrorism, which hasn’t affected the Caribbean, but is something that visitors worry about.
PORT SECURITY Security is the top concern of the BPI, considering that it receives more than half a million tourists per year and handles high numbers of cargo. In addition to well-trained
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PORT OF BARBADOS security officers staffing all areas of the port
transhipment
business
especially
efficiently.
around the clock, it also utilises high intensity
The port is equipped to handle over 100,000
lighting, specialised cargo scanners, security
containers per year, and authorities keep good
cameras, X-ray equipment, and patrol boats and
relations with the workers’ labour union so it runs
vehicles to boost security. The Port’s officers are
without interruption.
supported by the Barbados Royal Police Force and the island’s Coast Guard.
EFFICIENT CARGO OPERATIONS
Cargo berths are equipped with a 40-ton capacity gantry crane and 104-ton capacity mobile crane. The terminal is well equipped as well, with 50 forklifts, nine straddle carriers, and
To safely export the island’s rum, palletised
two reach stackers. Forklifts are equipped to
sugar, and a few manufactured goods, while
stuff and unstuff containers and work in confined
importing all the other goods Bajans need to
areas on board ship. Cargo tracking is electronic,
thrive, the port’s 200 cargo employees run its
using the KleinPort computer system, which
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THE SUSTAINABLE BUSINESS REVIEW
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The Sustainable Business Review - Quarter 1 2016
PORT OF BARBADOS gives customers access to the location of their
safety standards, plus mandated annual visits to
containers from their own office.
the onsite health clinic, the employee accident rate and sick days off has declined rapidly.
Barbados Mills, also located at the terminal, has its own dock with a 200 ton per hour conveyor
Barbados Port so strongly affects the rest of
belt and equipment for unloading and storing
the island (and vice versa) that its efficiency
wheat, corn, and soy meal. It also has a portable
extends outward to include others who offer
suction system to use in situations where that
services related to cargo and cruise calls. The
works better for unloading, and a tractor bucket
result has triggered the United Nations to add
system to use for cleanup.
Barbados to its list of maritime nations with high human development. It also generated several
Quality Tourism Service - Bajans are well aware
awards for the Port, not only from the Caribbean
of the benefits tourists bring to their island. They
Shipping Association, but from cruise lines like
make a special effort to be warm and friendly to
Dream World and World Cruise Destinations.
tourists, inviting them to enjoy the island’s sights, the great West Indian food, and the home-crafted artefacts. The port’s air-conditioned terminal has a duty free shopping mall run by the Bridgetown Cruise Terminal, Inc. with 58 international shops and a fleet of quaint pushcarts selling local goods. Local performers include a steel band, dancers, singers, and other entertainers. The terminal is where passengers can hook up with the island’s many tours and excursions. It even offers a popular rum-sampling kiosk. Employee Health - For port employees to work efficiently and be authentically friendly, they must be healthy and in good spirits. Knowing that Port authorities and coworkers are looking out
Barbados is not just a natural gateway to the Caribbean. It’s a high quality gateway.
for their safety helps. Workers are organised into task forces charged with looking after specific areas. With
concurrent training in health and
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THE SUSTAINABLE BUSINESS REVIEW
HEALTH CITY CAYM
Medical Touris Thrives in the Cayman Islands 50
The Sustainable Business Review - Quarter 1 2016
In a direct States, “m recipient cost less five years recoverin
HEALTH CITY CAYMEN ISLAND
MAN ISLAND
sm
ct response to the rising costs of health insurance and medical treatment in the United medical tourism� is becoming a realistic option for middle class patients. A recent stated that everything he spent to undergo a hip replacement in the Cayman Islands s than just the out-of-pocket deductibles he paid for surgery in the United States s before. The care from his medical team was top-notch and so was his vacation ng. Quarter 1 2016 - The Sustainable Business Review
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THE SUSTAINABLE BUSINESS REVIEW
In
times past wealthy people travelled to highly developed countries for specialised services unavailable elsewhere. But costs in some countries, and waiting
founder Dr. Devi Shetty said, “We have spent a lot of time carefully selecting and attracting some of the best doctors and surgeons, with world class supporting services, to our facility.”
times in others, have risen so much that patients now look for those services in less developed countries. Every year year between 60,000 and 85,000 Americans go abroad searching for high-quality health care that is both fast and cheap. The Cayman Islands is one place they’re finding it.
Coming from a well respected, independent accreditation organisation like JCI, the award verifies the high quality of the company’s health care. Since 1999 more than 410 public and private health care organisations in more than 45 countries have won the award. Health City has joined the elite.
The Caymans are three small islands in the Caribbean Sea, located between Jamaica and Cuba, still held as a British Protectorate. Health City, situated on the largest one, personifies the new trend. The year-old hospital proved its credentials when it won the Gold Seal of Approval last year from JCI, an international leader in healthcare accreditation. Health City
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The Sustainable Business Review - Quarter 1 2016
Health City,
Cayman Islands is a collaboration between Narayana Hospitals in India and Ascensión Health Alliance in the United States. Both are dedicated to providing quality services affordable to all. Narayana is one of the leading health care chains in India with 32 hospitals, many targeted to the poorer population.
HEALTH CITY CAYMEN ISLAND
Ascensión is the largest, non-profit health system in the U.S. and the world’s largest Catholic health system, also targeted to helping the poor and elderly. Asención operates over 100 hospitals and 250 care centres in the U.S.
operating, the hospital is expected to grow to 2,000 beds over the next 12 years, mostly serving international patients. (Cayman Islands population is only 1,500.)
to
A renowned heart surgeon, Dr. Shetty (formerly Mother Theresa’s personal physician) brought
international, regional, and local patients, as well as cardiology, orthopaedic, pulmonology, medical oncology, and paediatric endocrinology services. From the 104 beds currently
the initial medical team with him from India, already highly trained, which helped reduce start-up costs. From 100 employees the hospital now has 174, mostly international,
Health
City
offers
team-based
care
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THE SUSTAINABLE BUSINESS REVIEW
COLLABORATING TO CREATE EFFICIENT CONNECTED CARE
We’re committed to helping the healthcare community better align patient care with patient outcomes. But we can’t do it alone. That’s why we’re collaborating with physicians, hospital administrators, payers, and patients across the care continuum to create more sustainable models of care. Our goal? Better patient outcomes for everyone. Let’s take healthcare Further, Together. Learn more at medtronic.com/furthertogether.
UC201603642 EN © 2015 Medtronic. All Rights Reserved.
but aiming to hire more locals. They have also started an educational system, whereby the hospital takes on and trains 2,000-3,000
medical students. And they are working with the local nursing school to give nurses handson training.
Not only does this set-up result in increased skills and good jobs for locals, but it also helps keep costs low. With low operating costs, Health City doesn’t have to charge patients as much for services. As Dr. Shetty acknowledges, “A solution is not a solution, if it is not affordable.” According to Project Director, Gene Thompson, who heads the development project, the hospital’s greatest advantage is its threepronged approach: Providing the highest quality treatment, at the lowest possible cost, with the best possible service. He said that nowhere in the world is that combination matched better. Built on efficiency, the company is a role model
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The Sustainable Business Review - Quarter 1 2016
HEALTH CITY CAYMEN ISLAND for countries and medical companies around the world that are struggling with high health costs. All of its health providers are committed employees with interest in productivity, streamlining procedures, and improving health care. Robert Peart, MD, the CEO of Kaiser Permanente Medical Group frets that Health City “has American health care providers watching closely and anxiously.”
• Building the current facilities for about 1/3 the average cost of hospital construction in the United States. • Providing an all-inclusive flat rate ahead of time for every type of procedure and the services that support it. Billing patients only once for all services. • Publishing their prices, so patients know the cost of their treatment before they incur it. • Utilising the latest IT solutions for keeping track of patient care and hospital costs. • Providing a daily profit/loss statement to executives, so they can see how much care they can afford to give away to poorer patients. • Marketing their services to insurers and employers, who can negotiate large-scale contracts to send their patients and workers to the Caymans. In spite of local criticism the government of the Cayman Islands helped Narayana establish itself there. It offered tax breaks and lower insurance premiums, and accredited the licenses of Indian medical practitioners. Former premier McKeeva Bush recognised that medical tourism will boost the island’s economy and stated that he was “glad Dr. Shetty did not bow out while he was being criticised.” After six years of working out arrangements, they signed a contract in April of 2008 and moved forward to build the hospital.
Pearl also wrote recently in Forbes Magazine that “the operational approaches in Dr. Shetty’s hospital are about 10 years ahead of those used in the typical U.S. hospital.” He was referring to such practices as:
In spite of the JCI award given to Health City last year, the development process has not been a bed of roses without thorns. Some of its challenges have included getting people
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THE SUSTAINABLE BUSINESS REVIEW to understand that “island” doesn’t mean third rate or developing country. Thompson stated in our interview with him, that building confidence in the hospital is key to its success. Winning JCI certification has been a gamechanger in that regard. Logistics is also an issue. The Caymans are islands, hence most of their goods ship in from other countries. Hospital staff must take into account the extra time that takes, and make sure to order well in advance of the
time goods will be needed. They also must keep equipment replacement parts and extra emergency supplies on hand. And heaven forbid that there should be a hurricane that devastates local crops! The Cayman Islands benefit in numerous ways from the hospital. Health City purchases nearly all of its food locally. Its patients and those accompanying them use local transportation to get back and forth between the hospital and their hotel/s and to tour the country. As tourists, they spend money on hotels, accommodations, and buying the
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The Sustainable Business Review - Quarter 1 2016
work of local artisans. Some patients require long re hotel stays. For them, Health City has already built 44 u
The hospital and its extended units is designed to be eco sustainable. The JCI award, the economic benefits to th hire locally, and the hospitals efficiency all attest to the a highly successful future for Health City.
HEALTH CITY CAYMEN ISLAND
ecoveries needing housing, rather than units of housing and plans to build more.
onomically, socially, and environmentally he local community, the preparations to meeting of those goals. This speaks of
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THE SUSTAINABLE BUSINESS REVIEW
WES
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WESTPORT
STPORTS Adopts All Inclusive Objectives Of Economic Returns, Productivity And Sustainability
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THE SUSTAINABLE BUSINESS REVIEW
Relentless
Supply-Driven Growth Westports Malaysia commenced its business in 1994 with conventional operations. The containership operations commenced later in 1996 with one Container Terminal (“CT”), now known as CT1. Back then, there was one
transhipment port in the region and Malaysia’s imports and exports essentially have to go
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The Sustainable Business Review - Quarter 1 2016
through Singapore. So, opportunities beckons! By 1997, container terminal expansion was completed and CT2 raised Westports container handling capacity to 3.0m twentyfoot equivalent units (“TEUs”). Against the backdrop of the then Asian Financial Crisis in 1998, container volume at Westports still continued to grow unabated by
double-digit growth rates. CT3 was completed
WESPORT in 2001. With the supply-driven approach towards container terminal expansion, CT4 and subsequently CT5 was completed in 2008. With the Global Financial Crisis engulfing the world, Westports container volume eased in 2009 by merely 10%. And incidentally, 2009 was also the only year when global container volume experienced a decline. The double-digit growth resumed in 2010 and
levels of utilisation, CT7 started soon thereafter, which was immediately completed by the end of 2014. And within the same month CT7 was completed, it accommodated the then largest container vessel – MV CSCL Globe of 19,100 TEUs. With the emergence of global shipping alliances, where Westports is the regional transhipment hub of choice for Ocean 3, comprised of CMA CGM, United Arab Shipping Company and China Shipping Container Lines, the latest expansion commenced early in 2015 to build CT8, which has been contracted to Muhibbah Engineering (M) Bhd. And when CT8 is completed by mid-2017, Westports would have increased its container handling capacity to 13.5m TEUs. It would be equipped with additional container gate for more efficient container traffic movement into and out of the entire port, 15 more units of fuel efficient Rubber Tyred Gantry Cranes (“RTGC”) and also 14 new ship-to-shore Quay Cranes (“QC”).
Sustainability
Also Generates Economic Returns
necessitated another expansion. CT6 was completed in 2013 and with sustained high
Westports has experienced tremendous growth over the two decades with its supplydriven approach towards container terminal expansion. Delivering best-in-class level of service has always been a top priority and this core emphasis has subsequently yielded in favourable economic returns and also adoption of sustainability in the Group’s strategy and investing decisions.
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WESPORT When it comes to investment decisions in container terminal handling equipment, in addition to the required analysis on initial investment outlay, operational and regular maintenance costs, Westports also solicit feedback from its staff and equipment operators – they are the ones that ultimately directly contribute to the service levels and worldrecord productivity that the port achieves. So, when Westports embarked on its then latest CT6 expansion plans, which was subsequently completed and commissioned into service in March 2013, the Group was then using a fleet of conventional dieselpowered Rubber Tyred Gantry Cranes (“RTGC”). In order to enhance economic returns and productivity levels, new fuel efficient RTGC concepts were evaluated despite the much higher initial investment costs as they all claimed to reduce overall fuel consumption.
WESTPORTS ultimately ordered a fleet of Variable Speed (“VS”) RTGC and also Hybrid RTGC from Mitsui-Paceco. And MitsuiPaceco has been supplying container terminal handling equipment to Westports from the very beginning in 1996. The fleet of new RTGC were all delivered and subsequently fully commissioned into service by mid-2014 for CT6. And when CT7 was completed by the end of 2014,
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THE SUSTAINABLE BUSINESS REVIEW the VS and Hybrid RTGC consisted 27% of Westports total fleet of 157 RTGC. By operating a fleet of RTGC with basically
engines and is complemented with Lithium Ion battery power to reduce fuel consumption and lower emissions. The Hybrid RTGC cost the most but because it can recover and convert the kinetic energy into electric energy and stored inside the batteries when hoisting down the container, hence, it is also the most energy efficient. Westports has embarked on its latest terminal expansion, CT8, which should be completed by the middle of 2017. Being a publicly listed entity with growing awareness of its environmental footprint, the Group will strive to strike an optimum balance and all inclusive need between generating economic returns required by all shareholders while also enhancing sustainability in the Group’s operations. And the new RTGC for CT8 are also Mitsui-Paceco’s fuel-saving model.
three different power configurations and close monitoring of their performance for more than a year, Westports is now able to confirm that the objective of achieving a more favourable economic returns, despite the higher investment outlay, has also enhanced sustainability with reduced diesel consumption and GHG emissions. The VS RTGC has reduced diesel fuel consumption by controlling the engine speed and matching it with the required container load. Meanwhile, the Hybrid RTGC featured smaller
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The Sustainable Business Review - Quarter 1 2016
While cranes do the heavy lifting, the workhorse shuttling the containers between the container yard and the berthed vessels are the terminal tractors. With 420 units of terminal tractors continuously transporting the 8.4 million of TEUs handled by Westports in 2014, even the most robust machines are susceptible to wearand-tear. Balancing between operating and maintenance cost, performance-reliability and fuel consumption and emissions, the terminal tractors are replaced after seven to eight years. Additionally, Westports’ latest fleet of terminal
WESPORT tractors are designed to run on Euro 5 grade diesel. By the end of 2015, Westports will use Euro 5 grade diesel for its newer terminal tractors. This fuel has a sulphur content of only 10 parts per million (ppm), compared to 500 ppm for current Euro 2M diesel available domestically. The new formulation would reduce emissions of harmful pollutants while
improving the longevity of the diesel engines. While terminal handling equipment may be the obvious area for efficiency gain and cost reduction, Terminal Lighting is another area as Westports is a truly 24x7x365 port that operates all year round. Westports embarked on implementing energy efficient terminal
lighting by adopting prismatic lens technology in 2011. The premise of prismatic lens allows for more focussed spread of light to the ground level while requiring lesser 315W bulb capacity compared to previous 1,000W High Pressure Sodium bulbs. Energy savings of 68% per lamp is achieved. For building lighting, Westports converted incandescent lamps at two of its Administration buildings to LED types in 2014. LEDs uses between 40% and 50% less power over similar incandescent lights whilst providing similar brightness and has a longer lifespan. Unlike electricity that is a key input for the port’s operations, water consumption is less but nevertheless too precious to be wasted. To minimize water pipe leakages and the loss of water, Westports now uses HDPE (High Density Polyethylene) pipe to replace corroded iron pipes at the wharf areas. This lengthened pipes’ lifespan up to 50 years from iron pipes’ typical 15 years while eliminating corrosion and water leakages. Starting in 2014, all iron pipes would gradually be replaced by HDPE type. Ruben Emir Gnanalingam, the Chief Executive Officer of Westports, shared, “Westports journey into sustainability started before we even became a publicly listed company in
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THE SUSTAINABLE BUSINESS REVIEW
opportunities for more than 4,300 Malaysians. Over 21 years, Westports has transformed the island’s natural swamp lands and sands into a regional container transhipment and multi-cargo seaport terminal. And today, approximately 40% of Westports’ employees are Pulau Indah residents.The unique pre-eminent role on the island also created unique opportunities for Westports as CSR initiatives mostly focused on
October 2013 as we had already obtained the ISO14001 and OHSAS18001 certifications by then. Our top priority of delivering best-inclass level of service remains undiminished even as we incorporate sustainability into the organisation practises. We now view the objectives of achieving record productivity service levels, generating favourable economic returns and also reducing energy and resources consumption – are all mutually compatible and also necessary. With innovation and the adoption of new technologies, this all inclusive perspective is leading us to adopt more green management practices and be able to contribute towards environmental sustainability as well”.
Unique CSR
Opportunities On The Island Westports is located on an island and occupying 535-hectare of land, it is probably the largest organisation on Pulau Indah (which means ‘beautiful island’), creating employment
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The Sustainable Business Review - Quarter 1 2016
WESPORT
the island itself and its communities. Westports is now sponsoring all the schools on Pulau Indah under a Trust School Program to improve the quality of students’ learning and teaching effectiveness, thus enhancing overall students’ educational performance. The sponsorship amounted to RM6 million and improvements have been noticeable with positive feedback received.
Other island-focussed CSR contributions that directly engages with the communities are poverty eradication such as providing financial assistance to the less privileged; refurbishment of community facilities such as schools and mosque; and the provision of medical, safety and security services not only to the port but also to all the island residents by Westports’ port police.
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THE SUSTAINABLE BUSINESS REVIEW
SINGAPORE'S
Singapore’s Public Utilities Board (PUB) is one of the few water agenc
the world with a balanced supply of water, supported by long term plans to keep i way. Its 50 year plans take into account an increased population, potential drought, pot flooding, and a potential rise in ocean levels. The PUB is already engineering new
supply technologies that help counter these dangers and that can be utilised worldwid
Singapore’s water comes from four main sources called the “Four National Taps”: rainwater catchments, imported water, NEWater (recycled), and desalination. These so of supply are part of an integrated program that has three main pillars: 1. To capture every drop of rain that falls on Singapore, 2. To collect every drop of used water, 3. To recycle every drop of water more than once.
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Quarter 1 2016 - The Sustainable Business Review
SINGAPORE’S PUBLIC UTILITIES BOARD (PUB)
S Public Utilities Board (PUB)
cies in it that tential water
de.
Local ources
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69
THE SUSTAINABLE BUSINESS REVIEW Of that demand, reclaimed water supplies 30%, desalination provides 25%, and the rest is split between 17 local reservoirs (i.e. rainwater) and imported water. PUB is currently working with local communities to lower demand through conservation and, during the next 50 years, will focus on implementing new technologies to run each of its four taps more efficiently.
TAP 1 - RAINWATER CATCHMENT PUB collects rainwater in 17 reservoirs around the island - two thirds of the island being used for water catchment. Many of Singapore’s reservoirs are located inside the city itself, including drainage from some of its oldest, densest population areas (e.g. the Central Business District). Using specialised filtering membranes, PUB cleans all of its collected water to World Health Organization (WHO) drinking standards. According to PUB’s long term plan Our Water, Our Future, “Singapore is probably the only city in the world where urban stormwater harvesting is carried out on such a large scale.”
TAP 2 - IMPORTED WATER
Leslie Swanson, Organizational Development Consultant, lived in Singapore for 20 years while working at MSD Pharma. She said, “I watched as Singapore transformed itself into becoming a leader in water sustainability.” Having access to water has been a recent luxury for most Singaporeans. Within the last 50 years, they have gone from bathing with a bucket and scoop to having running water 24/7. Now total water demand hovers around 400 million gallons of water per day (mgd), with 45% of that used for domestic consumption and the rest for nondomestic use.
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The Sustainable Business Review - Quarter 1 2016
SINGAPORE’S PUBLIC UTILITIES BOARD (PUB) In 1961 Singapore negotiated an agreement with the Johor State Government to import up to 250 mgd from the Johor River until 2061. Johor is the southernmost state on the Malaysian Peninsula, linked to the island of Singapore by two constructions - a 1,920 metre twin-deck three lane roadway and an older 1,056 metre causeway that includes a road, rail line, and water pipe. PUB does not aim to increase this amount of water in future, but will supply Singapore’s population growth via the next two taps.
TAP 3 - NEWATER
Singapore considers NEWater to be the pillar of its water sustainability program.
The government introduced this high-grade reclaimed water project in 2003, wherein used water is purified using anaerobic micro-organisms, micro-filtration, reverse osmosis, and ultraviolet disinfection techniques. (The biogas produced is collected for power generation.) Before being released for public use, NEWater’s ultra-clean reclaimed water passed more than 130,000 scientific tests for quality. Singapore uses NEWater mostly for air conditioning systems and industrial procedures in wafer fabrication plants, industrial estates, and commercial buildings. Excess NEWater is sent to the local reservoirs for use during the dry season. This water source meets 30% of current demand and.
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Ed. Zublin - Pipe Jacking Division & Zublin Precast Industries
WE ARE EXPERTS IN PROVIDING TUNNELLING SOLUTIONS FOR MANY INDUSTRIES • • • •
WATER / WASTWATER MINING OIL & GAS CONSTRUCTION
Ed. Züblin is the German market leader in building construction and civil engineering, for more than 110 years and has been successfully realizing challenging construction projects nationally and internationally. The company’s range of services includes all construction related tasks – from complex turnkey construction to civil engineering, bridge building and tunneling to public private partnerships. Ed. Züblin is a part of the corporate group headed by Austria’s STRABAG SE, one of Europe’s largest construction companies. Ed. Züblin AG – Singapore Branch was established in 1997 expressly to provide the highest standard for construction of utility tunnels using the pipe jacking methodology. As of 2015, the Singapore branch has successfully completed more than 24 km of utility tunnels. Also in 2015, a state-of-the-art precast concrete factory, managed by ZUBLIN Precast Industries SDN. BHD., was incorporated in Kota Tinggi, Malaysia. We aim to develop the perfect technical solutions for all our production and construction activities, always using state-of-the-art technology and keeping in mind safety, quality and productivity. Knowing that every contract has its own challenges, our comprehensive services offer our customers complete solutions, which combine excellent products and technical know-how.
Ed. ZUBLIN AG, SINGAPORE BRANCH 47 Scotts Road, #17-02 Goldbell Towers Singapore 228233 Phone: +65 6339 0436 branch@zublin.com.sg
Fax: +65 6339 0460 www.zublin.com.sg
SINGAPORE’S PUBLIC UTILITIES BOARD (PUB) To support this program, PUB built a Deep Tunnel Sewerage System that centralises sewage collection and treatment, and frees up surface land for other uses. PUB is now experimenting with locating recycling and desalination plants together, so they can use the concentrated brine discards from each plant to generate osmotic power for electricity. As part of a team building day, Ms Swanson accompanied MSD’s development team on a tour of the NEWater plant. They wanted to study the communication and education behind PUB’s successful introduction of reclaimed water to the public. She labelled the plant’s visitors centre as “world class,” saying it not only showed the science, but also provided information on different water resources around the world.
TAP 4 - DESALINATION In 2005 Singapore opened its first desalination plant for production of 30 mgd of drinking water. Singspring Pte, Ltd. designed, built, and will operate the plant for its first 20 years. They built a second plant in 2013 to desalinate 70 mgd of sea water. By 2060 desalinated water should be supplying 25% of Singapore’s water demand. One of the biggest detriments to operating desalination plants in the past has been their excessive use of energy. PUB’s research and development companies are developing new techniques, using electrochemicals, which should cut energy use down by half. One of those companies, Evoqua Water Technologies, is testing and developing two main techniques: The way that mangrove trees and euryhaline fish extract sea water, and what happens when aquaporins are embedded on membranes. Both of these are instances
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THE SUSTAINABLE BUSINESS REVIEW of biomimicry - exploring and imitating the way nature handles desalination - which results in efficiency that harmonises with nature.
FUTURE SUPPLY PUB’s next priorities are: Reducing the energy used for all four taps, capturing whatever energy is released during the water cleansing process, and finding additional storage for excess water that can be saved for future use - including possible underground storage caverns. Much of the research developed in the course of satisfying these priorities will lead to additional technological breakthroughs. According to Prime Minister Lee Hsien Loong, “In recent years, Singapore has gone from managing water as a resource to increasingly leveraging it as an economic asset.”
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SINGAPORE’S PUBLIC UTILITIES BOARD (PUB) He is referencing Singapore’s desalination plants, NEWater project, and treatment of urban runoff, which were made possible by R&D engineers working closely with the public to test the technologies they were developing. Involved in Singapore’s water technology centre are now 150 water companies and 26 research centres, some of which are already producing turnkey models for NEWater and desalination plants for sale. In 2012 the government designated US$470 million to further stimulate exports from this sector, anticipating that its water treatment products will soon be in high demand.
There may be a market in California. Ms. Swanson, who now lives there, is saddened by knowing that California is in a severe drought and “that the technology exists to be capturing our street runoff,” and “that the water we use is lost and not recycled. “ California needs to communicate with Singapore. By developing the breakthrough technologies it has, Singapore can not only meet its own water needs in the present and future, but can also profit by helping other countries meet theirs.
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KAHRAMAA: IN THE Peaceful countries in the Middle East, especially the smaller ones, are quickly establishing themselves as regional development leaders. Qatar is one that intends to lead in sustainable development. Its ultimate aim is: “Management of the environment such that there is harmony between economic growth, social development, and environmental protection.” Qatar is a tiny country located on the NE coast of Saudi Arabia, currently one of the higher users of utilities per capita in the world. Its citizens are also the richest. A former British Protectorate, the country achieved independence in 1971 and is now a peaceful constitutional monarchy with 1.8 million people (most of whom are expatriates). Its first desalination plant was built in 1953. The country’s reserves of natural gas and oil are the third largest in the world.
Qatar is known for its accomplishments in human development, considered by the United Nations (UN) to be the highest in the Arab world. The country’s government has been conscientious about using its profits to benefit the people. In 2022 it will become the first Arab nation to host the FIFA World Cup games (men’s soccer football).
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KAHRAMAA
RIGHT DIRECTION
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CATEGORY
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THE SUSTAINABLE BUSINESS REVIEW The government is also committed to becoming the sustainability hub of the region, acting on guidelines spelled out by the UN Environment Program. HIs Excellency Dr. Mohammed bin Saleh al-Sada, Minister of Energy and Industry, says that sustainability is the key to the rapidly changing world. He commends the strides made by Qatar’s electricity and water provider, KAHRAMAA, in its efficient delivery of utilities and successful sustainability projects, described in its 2014 sustainability report.
important, so one of its sustainability arms is to keep the public informed about its programs. Through public information projects on the Internet and visual media, and public appearances in schools, KAHRAMAA conveys the importance of water quality and water and energy conservation, as well as the role of the public in achieving the country’s sustainability goals. Already utility customers are responding by cutting down their use. The average annual
KAHRAMAA‘s
sustainability program is fairly new. In putting it together, the company involved all of its stakeholders to help develop a practical approach and prioritise key issues. It held workshops for government officials, customers, suppliers, investors, and employees. It also set up and trained an internal Sustainability Task Force to oversee the program.
This initiative includes partnership with key industry leading providers including Siemens, ABB, Strom Construction, Voltage Engineering, India’s L&T just to mention a few. The strategy also includes engaging and growing the local providers as well. KAHRAMAA is a distributor, not a generator, of water and electricity. It’s government owned with no subsidiaries and is the only such distributor in the country. Because it is a government entity, public appearance is
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use of water dropped from 232 cubic metres per person in 2012 to 216 cubic metres in 2014. The average use of electricity dropped from 16,294 kWh per person in 2012 to 15,100 The company also conserved internally - mainly by examining its facilities and pipelines to close up leaks. In 2007 the company measured a water loss of 59% from leaks alone. By 2014 that loss was reduced to about 10%. In 2007 there were almost 27 water main bursts per
KAHRAMAA each 100 km of pipe, whereas in 2014 the average was barely over 6 bursts per 100 km. A look at water used in the country’s cooling systems showed great potential for conservation of potable water. Taking on just two districts as pilot projects in early 2014, the company provided reclaimed sewage water to use in that area’s cooling systems. All districts are required to switch over eventually, with expected water savings of 80% and electricity
savings of 40% by 2023. Also in progress are construction of a megareservoir with a 7 day supply of potable water, installation of smart meters countrywide (with the help of partner, IBERDROLA), upgrading customer service offices with new interiors, evaluating and retrofitting schools to serve as efficiency models for other schools, Installation of LED street lighting, setting up a tendering service for suppliers online, legislating the
use and quality of potable water, as well as establishing manufacturing standards for water/electrical equipment and fixtures. These are impressive results, considering that the company’s sustainability program has only been in effect for a couple of years.
PLANS for the FUTURE
So far the company has focused on legislative and conservation changes, but there are other aspects to sustainability too - like customer service, employee well being, supplier facilitation, and Qatarization (hiring more locals). Here are some of the projects planned for the future.
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CERRO NEGRO CATEGORY
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KAHRAMAA TRAINING: Extending the principles of conservation, sustainability, and good customer service all involve training. KAHRAMAA has several projects planned along these lines. •To carry out the national goal of employing native Qataris, the company plans to continue providing educational scholarships, then give
training in utilities management to those who interested and hire them as leaders in the industry. •KAHRAMAA is not yet satisfied with its customer service response, so will be working to identify new ways to improve, including moving old customer records online for easier access.
•Tourism uses a lot of energy and water, but tourists have little incentive to conserve. KAHRAMAA intends to reach out to this industry to show how it can operate more sustainably. In addition, the company will engage suppliers and contractors to apply sustainability practices, and will implement a religious awareness program to engage mosques in conservation practices.
INCREASED SUPPLY : With a burgeoning population and economy, the company will be looking at potential new sources of supply, both of water and electricity. •The sun shines year round and is a great potential source. As fuel cell technology advances, solar power can become a significant new supply of electricity. KAHRAMAA will be studying the feasibility of adding solar power to
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THE SUSTAINABLE BUSINESS REVIEW its grid and looking for good locations. •Northern Qatar is both windier and less inhabited than the rest of the country. KAHRAMAA will be evaluating the potential for wind power projects in that region. •Certain potable water wells have fallen into disuse and others are currently too polluted to use. The company will rehabilitate all of those wells to add more potable water to its supply. •Qatar does have good aquifers, but not much is known about them. To see what is possible for storage and recovery of reclaimed water, the company will be instituting a comprehensive study of the nation’s aquifers.
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UTILITIES MANAGEMENT: Good management tools can add greatly to the success of a comprehensive sustainability program like this one. Here are a couple of tools the company plans to install. •To get a good handle on all aspects of its water network, KAHRAMAA will be installing a centralised, online water management system to monitor the entire country. •Water quality is important, especially when it comes to drinking water. To ensure that all water distributed, whether its source is desalination, underground aquifers, storm water capture, or reclaimed water, the company will build a new water quality assurance laboratory to run
KAHRAMAA
KAHRAMAA’s sustainability program is ambitious, but the company has already proven it can succeed with those projects it has taken on. If it keeps on the way it’s going, Qatar could easily establish itself as a sustainability leader in the Middle East, in spite of the country’s small size.
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QATAR
COOL EXPANDS CENTRAL COOLING TO DISTRICT SIZE
Whether climate change is human-caused or not, the creation of companies like Qatar Cool and the environmental commitment of the country of Qatar benefit the economy, humanity in general, and the earth we live on.
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QATAR COOL
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THE SUSTAINABLE BUSINESS REVIEW Working off economies of scale, Qatar District Cooling Company (Qatar Cool) is centralising the cooling systems of buildings throughout the country’s regions. By providing cooling plants in major districts to replace individual air conditioning units in buildings, Qatar Cool saves carbon emissions, lowers energy use by 40-60%, decreases noise pollution, and saves building owners money in construction and maintenance costs. Centralised heating and cooling is not a new concept. It’s how the Romans supplied their citizens with hot public baths millennia ago. Many countries around the world have similar set-ups today. The system is fairly new in Qatar, however, and Qatar Cool is currently the country’s leading supplier of chilled water for air conditioning.
COMPANY
EXCELLENCE
Qatar Cool is a thirteen-year-old, private company run by Mr. Yasser Salah Al Jaidah, Chief Executive Officer. Mr. Al Jaidah has over a decade of energy experience and has held positions throughout the field, which include maintenance, operations, engineering, project management,marketing and venture projects on four continents in countries such as Qatar, Korea, Japan, France, Norway, USA, Italy, Singapore and the United Kingdom. Qatar Cool has been recognised for their innovative practices by the International District Energy Association (IDEA), has been given “The Award of Excellence” for a municipal scheme serving more than 10,000 citizens, conveyed at the 3rd Global Energy
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Climate Awards, and was awarded “The Best District Cooling Provider” at the Climate Control Middle East award ceremony. The company was also presented with the “International Safety Award” for 2014 and
QATAR COOL 2015 by The British Safety Council, the “Industrial Building Conservation Award” from Tarsheed Kahramaa and, more significantly, the “System of the Year” award for both districts served, from the International District Energy Association (IDEA) - a great honor to receive
from such a prominent association at the top of the industry. Qatar Cool has three plants currently in operation, with another scheduled to open in 2016 - built to the Leadership in Energy and
The company was also presented with the “International Safety Award” for 2014 and 2015 by The British Safety Council, the “Industrial Building Conservation Award” from Tarsheed Kahramaa and, more significantly, the “System of the Year” award for both districts served, from the International District Energy Association (IDEA) - a great honor to receive from such a prominent association at the top of the industry.
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THE SUSTAINABLE BUSINESS REVIEW Environmental Design (LEED) silver standard. The two operational plants in the West Bay district currently serve fifty two towers with a combined cooling capacity of 67,000 tons of refrigeration (TR). The third plant, once operational, will have a cooling capacity of 40,000 TR to meet the growing demand. The total area served in West Bay is more than 2 million square meters (21 million square feet), serving more than 50% of Doha’s West Bay skylines. These include governmental offices, ministries, hotels, residential, commercial retail and office complexes. Qatar Cool’s West Bay plants are equipped to use Treated Sewage Effluent (TSE) in their operational plants. The third operating plant, located in the Pearl Qatar, has a cooling capacity of 130,000 TR which supplies the manmade island, making it the main eco-friendly technology on the island. Qatar Cool’s Integrated District Cooling Plant (IDCP) was inaugurated in November 2010 and is the largest cooling plant in the world. The total area to be served, once the island is completely supplied, is 41 million square feet, occupied by 41,000 residents (approximately 15,000 apartments & 700 villas) and comprised mainly of hotels and shopping centres. Qatar Cool has also introduced a new business model where it designs, builds, operates and maintains District Cooling Plants for developers such as Al Gassar Resort and St. Regis Hotel
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in Doha. Most recently the company signed with Qatar Railways Company for the provision of district cooling to seven of Doha’s Metro Red Line stations. These efforts are on-going and if successful can be expected to contribute significantly to the long term growth of the company.
How It
WORKS
Qatar Cool’s plants essentially replace the regular HVAC units used by most modern
buildings. Instead of each building having its own cooling systems (thereby having to maintain the system and replace dysfunctional parts) there is a double circulation system that meets in the basement of each building. Qatar Cool produces and circulates its chilled water to multiple buildings through a network
QATAR COOL of pre-insulated underground pipes. The chilled water contacts each building’s HVAC system via an Energy Transfer Station (ETS), where it passes through thin metal plates of a uniquely designed Plate Heat Exchanger (PHE). This cools the building’s air conditioning liquid, also passing through the plates, which then circulates the building to chill the air throughout. In addition to eliminating the worry of maintaining chillers or cooling towers, building owners benefit by having an air conditioning system that works all hours of the day and night. Any necessary maintenance shutdowns are covered by Qatar Cool. Not only does a building save money and energy, but without cooling towers or chillers on the premises, the building is both quieter and more attractive. Qatar Cool’s great core strength comes from its employees, who are oriented toward providing high quality operational efficiency and service. State of the art facilities and a focus on customer service enhance that strength. The company has built-in feedback loops that allow employees to respond quickly to customer requests. Employees are trained to know more
than just their jobs, and to be responsible for their own health and safety.
Environmental Benefits &
INITIATIVES
Air conditioning amounts to 70% of all electricity consumption in the Middle East, so any savings in electricity helps the environment. Qatar Cool’s system uses half of the electricity of most normal cooling systems. Together their operational plants have saved over one million kilowatts of power during the past six years. According to Mr. Al Jaidah, “We have achieved the elimination of over 200 million kilograms of carbon dioxide from the atmosphere. This is equivalent to removing over 26 thousand vehicles from the roads or planting 14 million mature trees.” Qatar Cool is currently enacting several additional environmental initiatives: The implementation of Treated Sewage Effluent (TSE) in their West Bay cooling plants was recently introduced. Quarter 1 2016 - The Sustainable Business Review
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THE SUSTAINABLE BUSINESS REVIEW Qatar Cool and Tarsheed plan to work together to deploy key messages and implement programs on energy conservation and efficiency to schools, residents and business owners.
To increase awareness about climate change, the company supports the annual Earth Hour global initiative by cutting use of all inessential electricity at each plant for an hour. This year’s Earth Hour is March 19 at 8:30 PM.
Qatar Cool is a member of the Qatar Green Building Council (QGBC) and is active in the Green Education Interest Group, which focuses Conserve Today, Preserve Tomorrow leaflet on educating and training university students - This leaflet, made and distributed by Qatar on sustainability and environmental issues. Cool, consists of useful tips for conserving energy, such as maintaining optimal temperatures, closing off unoccupied rooms, conducting regular maintenance and more, for both users and building management.
Qatar Cool is sponsoring a Green Program for Schools (GPS) under the banner of Oryx Advertising and Qatar Today Magazine. The GPS is an engaging, green environmental initiative for students that goes beyond typical competitions, placing the responsibility of sustainability directly on the students.
Other - The company produces another leaflet that shows the benefits of district cooling for customers, society as a whole, and the government. It highlights the fact that electricity is a subsidised commodity that provides financial gain when use is reduced. It also reduces the demand for natural gas, which is in line with the country’s National Gas Conservation Strategy.
Qatar Cool is a good example of how mitigating climate change can result in the emergence of profitable and environmentally supportive companies. Whether climate change is human-caused or not, the In an effort to enhance the conservational creation of companies like Qatar Cool impact and development of district cooling, and the environmental commitment of the Qatar Cool and the Qatar Environment and country of Qatar, itself, benefit the economy, Energy Research Institute (QEERI) have entered humanity in general, and the earth we live into a partnership to improve district cooling on. efficiency and to research expanded use of Treated Sewage Effluent (TSE).
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High-end Black Tiger Prawns grow naturally off the north coast of Australia. Rather than overfishing those waters, Australia’s Seafarms Group will feed the prawn-hungry world with its Project Sea Dragon.
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up
SEA FARMS
Plans to Launch Australia Into a AQUACULTURE LEADER
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The Australian, Northern Territory, and Western Australian Governments have
According to Seafarms’ Managing Director, Chris Mitchell, the company conceived of
announced their support to what could become one of the largest fully integrated prawn aquaculture projects in the world. Australia’s desire to develop its sparsely populated northern region, combined
the project because, “80% of the world’s fisheries with sustainable catch limits are overfished.” Global demand is increasing and the only way of supplying it sustainably
with Asia’s hunger for seafood, underpins this massive new aquaculture venture by producer Seafarms Group Ltd. Worldwide, prawns account for about 4 million tons of the total 74 million tons of farmed seafood produced. China, India, Thailand, Indonesia, Vietnam and Ecuador, are the biggest prawn producers, all
is through farming. At the same time, the company was looking for optimal ways of utilising available water and found that
80%
of the world’s fisheries with sustainable demand is increasing and the only way of supply through farming.
of which farm the whiteleg variety, plus smaller amounts of the more expensive Black Tiger Prawns (Penaeus monodon). Australia currently produces about 5,000 tonnes per year of farmed prawns, which is nothing compared with the others, but that equation will change if the company’s aquaculture project comes to fruition. Seafarms is already the biggest prawn farmer in Australia. Soon it will be one of the biggest in the world.
growing prawns would “add an enormous amount of value” to Australia’s waters. Aptly named “Project Sea Dragon” this A$2 billion (US$1.45 billion) upcoming project is centred on a vast cattle station on the
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SEA FARMS
border of the two northern territories. There the company aims to start building ponds in mid 2017 (with most of the work being done during the dry season) and by late 2018 expects to be exporting to Asia. The Seafarms Group is currently proving the feasibility of the project with a A$16 million (US$ 11.5 million) study, and has begun securing required approvals and
e catch limits are overfished.” Global ying it sustainably is
agri-food company, listed on the stock market, which operates, builds, and invests in sustainable aquaculture projects that produce high-quality seafood. As Australia’s largest producer of farmed prawns Seafarms grows, processes and distributes the wellknown Crystal Bay Prawns® premium brand. Since its inception over 30 years ago, the company has been farming banana prawns in Queensland on a relatively small scale and has only recently commenced growing black tiger prawns. Although the smaller, sweeter banana prawns are native to Australia and are preferred by the Australian palate, the larger black tiger prawns are preferred by markets in Asia and other parts of the world. The Northern Australian coast is their natural habitat. The company is utilising Seafarm’s operations in north Queensland as a pilot project for Project Sea Dragon, which will supply protein for the world, while decreasing the fishing in the wild that depletes the ocean. The project will be developed as an integrated system that includes all phases of prawn production - breeding, hatching, growing out, processing, and exporting.
licences to operate.
Who is
Seafarms? Seafarms Group Ltd is an Australian
Northern Australia is uniquely suited to farm seafood, since it’s difficult for contamination to spread from other countries to this island continent. However, its isolation also requires that seafood be farmed carefully to prevent contamination starting in Australia. The growout farm will be supported by a quarantine
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facility in Western Australia, as well as breeding facilities and hatcheries near Darwin in the Northern Territory. The geographic spread of these facilities is designed to enhance overall biosecurity of the project.
1,600 jobs in Northern Australia when operating at full capacity. He estimates that 700 people will work at Legune, 600 at Kununurra, and another 300 at Darwin and associated facilities at Wyndham and Exmouth in Western Australia. At the same time, Seafarms will be looking for ways to streamline the production process and reduce costs to ensure they have competitive pricing for exports to Asia and the United States. Project Sea Dragon also looks to be highly profitable. In expanding the company’s current production of 1400 tonnes of farmed prawns to 100,000 tonnes, while building new saltwater
Operations will begin on a nominal 1,000 hectares (ha) of land based ponds, and will produce approximately 10,000 tonnes per annum (tpa) of prawns during the first production phase, eventually expanding to 10,000 ha. To maintain surrounding river and coastal environments, and support adjacent agricultural land uses, Project Sea Dragon will utilise sustainable land use and integrated design practices. Prawn production on this scale is labour intensive. Chris Mitchell expects the project to provide up to
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ponds across the northern pastoral lease, Seafarms estimates that the project’s costs will be offset by a 44% return on investment. Assuming a price of A$15 per kilogram, first-stage output of 10,000 tons should bring in revenue of A$150 million a year, rising to A$1.5 billion when the company is producing fully. There will be plenty of buyers. In addition to China as the world’s biggest purchaser of prawns, India, Japan, South Korea, and the United States will be target markets. Project Sea Dragon may be the ideal enterprise to kick-start the development of Australia’s northern territories.
SEA FARMS
Seafarms
is already the biggest prawn farmer in Australia. Soon it will be one of the biggest in the world.
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