Richards Bay Minerals

RICHARDS BAY MINERALS

RICHARDS BAY MINERALS

A Young Leader // Comes to

Richards Bay PRODUCTION: Colin Chinery

Richards Bay Minerals, a world major in heavy mineral sands extraction and refining, is South Africa’s largest mineral sands producer. The company has a new Managing Director; World Economic Forum’s 2017 Young Global Leader Billy Mawasha. He talks to Enterprise Africa about his plans, principles and priorities.

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With 45 mineworkers killed so far this year and 73 in 2016, occupational health and safety remains a major concern in South African mines. Achieving ‘zero harm’ looks like taking far longer than hoped or anticipated.

But from KwaZulu-Natal’s Richards Bay Minerals comes a decidedly encouraging trend. The Rio Tinto company continues to operate safely and successfully, and in June completed five million injury free hours for the first time in its 40-year history.

“The organisation has done excellent work in reaching the five million figure for the first time, and it’s a great achievement,” says RBM’s recently appointed Managing Director, Billy Mawasha.

“Since this figure was reached we have had some challenges which we are working through in terms of injuries. Safety is a major focus for us; the number one in everything we do. It’s one of our core values and a key to where we get to.”

WORLD LEADER Formed in 1976 to mine the vast mineral rich sands of the northern KwaZulu-Natal province, RBM is a world leader in heavy mineral sands extraction and refining, and South Africa’s largest mineral sands producer and beneficiation company.

Producing predominantly high purity iron, the gemstone zircon, rutile, a form of titanium dioxide deployed in the manufacture of refractory ceramics, titania slag, used in paint, paper and plastics, and titanium dioxide feedstock.

RBM uses a system of ponds and floating dredges to mine the ore body, where heavy valuable minerals such as rutile, zircon and ilmenite, the most important ore of titanium (titanium alloy applications are found in high-tech airplanes, missiles, space vehicles and even surgical implants). These

are recovered from the sand, with the heavy mineral concentrate transported to the mineral separation plant.

RBM is currently producing two million tons of products annually, contributing 50% of KwaZuluNatal’s mining sector and 3.3% of the national mining sector output.

At any one time, no fewer than 20 large ocean-going vessels are either at anchorage in Richards Bay – South Africa’s largest industrial harbour - or on the high seas, transporting RBM’s products to customer markets across the globe.

STRAIN AND STABILITY Like its peers, Rio Tinto came under significant strain when commodity prices started falling in 2014 and 2015, ending a year-long boom.

A wide-ranging restructuring programme followed, with equity raised, debt cut and dividend slashed.

“If you look internally at Rio, everyone knows that it went through a process of fixing the balance sheet with the result that a lot of focus over

the last two or three years has been on cost cutting, tightening and aligning the business and increasing efficiencies and remaining a tier one business. That is our asset, and we need to keep the cost pressures down to retain our tier one asset,” explains Mawasha.

A former UCT electrical engineering graduate, Mawasha joined RBM from Anglo American’s Kumba Iron Ore where he was Executive Head of Operations and Integration, following on from a career path that included working for the De Beers Group and AngloGold Ashanti.

His personal credentials are striking. Last year he was named by the South African Financial Mail as a top black leader of the future, and this June was awarded the title of Young Global Leader by the World Economic Forum.

ZULTI SOUTH Ambitious for Richards Bay Minerals and the local communities it serves, he takes control at a time when RBM is preparing to embark on a

new mining project, Zulti South.

Located along a 20km strip of coastline south of the town, this will extend considerably the life of the company’s mining operations.

With deposits of minerals at RBM’s 40-year-old Zulti North mine running down – operations are set to continue there up until 2030 - the plan is for Zulti South to come online in phases to maintain production levels of 200 million tons a year.

Zulti North currently employs 2000 permanent and 2000 contract employees, and Zulti South is expected not only to maintain these jobs through relocation, but also create several hundred more. Go ahead for the project follows the signing of a land use agreement with the Dube and Mkhwanazi traditional authorities representing the host communities that live on the land.

Zulti South phase one - which includes setting up new dry mining infrastructure in the Port Durnford area - could come on stream in the next few months, with a heavy

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INDUSTRY FOCUS: MINING

minerals hourly extraction rate of 2500 tons. Phase two is set to start operations in 2021 at a lower production level of 1250 tons an hour.

“The project is at the stage of final feasibility, and I hope we will be ready to start on it early next

year. This is our main key project, one that will extend the life of RBM’s operations until 2037. Aside from this, our focus is to continue to put ‘stay in business’ capital into RBM to maintain continuity of our life,” says Mawasha.

CHANGING YEARS In his 17 fast-track years in the industry, Mawasha singles out the rapacious Chinese demand for raw materials as the biggest emerging factor in the sector, followed by technology and the increasing

//ROCKWELL AUTOMATION IT ALL COMES TOGETHER: LEVERAGING THE CONNECTED MINE When thinking about an Industry 4.0 roll-out strategy, there’s a widely held view that large-scale investments in new control and automation technologies will underpin its realisation. Yet, astonishingly, less than 1% of all available data generated by devices within the current industrial space ends up being converted into actionable information.

Unless plant equipment is exceptionally antiquated, the challenge, therefore, is not about investing in newer products, but in optimising utilisation of existing products through smarter engineering.

It’s about implementing a system that efficiently aggregates real-time data to create some level of analytics and usable information, and ensuring this information reaches a level high enough in the organisation so that executive decisions can be made based on empirically accurate, transparent, real-time equipment and process statuses.

It is this level of operational and organisational intelligence – a Connected Mine – that will enable companies to improve the performance and profitability of their enterprise by utilising existing assets and new infrastructure. Through smarter engineering, managers can: i) gain greater predictability of their business performance; ii) make better capital investment decisions, and the ability to rank those choices; and iii) implement the most effective and least adverse cost-cutting initiatives possible, when required. These are important considerations for any mining company.

Leveraging information for greater predictability At an operational level, predictive maintenance that averts a shortfall in production or allows contingency plans to be made – such as short-term stockpiling – can mitigate any negative impact and allow better predictability at an organisational level.

For CEOs and shareholders, this means that performance and target guidance can be closer to actual profitability for the period. It allows guidance to be more flexible, both to market factors, and to internal business mechanisms.

Enhanced accuracy as to the predictability of production and profitability means more skittish results presentations to shareholders can be avoided – a valuable advantage for any listed company, and real value that they can add to their shareholders in turn.

Leveraging information to make better investment decisions

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Sound capital investment decisions around where to spend, how much to spend, and how to rank this spend need to be based on accurate information received directly from your mining operations. Without accurate, indisputable empirical information derived from your processes, there’s more guesswork; more subjectivities and anecdotal input; and more luck involved in making these big decisions.

For a diversified miner with a range of operations across a range of minerals and perhaps multiple geographies, it becomes a question of not just where to invest capital, but how to rank capital, to prioritise investments, that becomes critical.

Mine-wide control architectures that quantify the status of your systems are the most accurate basis upon which to make sound capital investment decisions.

Leveraging information to ensure better cost-cutting initiatives Aggregating data into a level of analytics that highlights where in your operation you can cut costs while limiting any adverse effects on productivity; the amount you can cut by; for how long you can cut costs for; as well as how to rank cost-cutting avenues, minimises guesswork, and ensures companies don’t cut expenses they’d have been better off leaving alone.

This kind of analytics is also critical in helping miners become leaner by trimming inefficient or wasteful processes and expenditures and gaining maximum value from their assets.

Conclusion: South Africa’s well developed, mature mining environment means that there’s a high level of sophisticated control equipment being used across the industry. Our objective is to help mining companies make the best business decisions they can by utilising the data provided by their control equipment to the fullest extent.

www.rockwellautomation.co.za

Barry Elliott Managing Director, Rockwell Automation Sub-Saharan Africa

© Rio Tinto 2017

BUSINESS PROFILE

RICHARDS BAY MINERALS MD BILLY MAWASHA

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RICHARDS BAY MINERALS

attention given to health and safety.

“Safety has been a very big change since the early 2000s, and companies have been working hard to reduce deaths in the mines. RBM believes safety and health are indivisible, and our vision is to create an injury and illness-free workplace. For us safety is about people, and we are determined to succeed in this.”

Another development, and one close to his heart, is the increasing emphasis on personal welfare and social advancement.

Mawasha is passionate about education and the development of others, serving on the Board of Symphonia for SA, a national NPO with a bold vision to ensure quality education for all children in South Africa.

Last year, he was named in the South African Financial Mail ‘Little Black Book’, as one of the country’s top black leaders who want to lead South Africa to greater things.

It is a mindset in accord with that of his new employer. RBM’s growth stimulates employment, infrastructural development, and encourages the uptake of skills within the local workforce. Since it began operations in 1976, it has ploughed millions of Rand into the community through corporate social investment initiatives across diverse sectors such as health, education and agriculture.

And this year RBM has been named by Netherlands-based Top Employers Institute as a ‘ Top Employer for 2017’.

This recognises organisations across the globe that successfully demonstrate exceptional HR environment and employee offerings.

RBM’S SUCCESS FORMULA Companies are scored on their ability to attract, develop

and nurture talent, as well as continuously improving employment practices. But what, as a player in a crucial and demanding completive sector, sets RBM apart from its rivals?

“Number one is that we are a safe and reliable supplier. Secondly, we have a portion of our stream which we call HiTi, which has a slightly higher titanium than the market. We currently own a small percentage of this market and the fact that we have the ability to develop it is important.

“Another factor is that we have been here for 40 years and have established close relationships, a further key element on our side.

Lastly, between us and our sister Rio companies, we are able to satisfy the needs of our customers.

“Our history too is important.

We remain a key contributor to the KwaZulu-Natal economy and also the South African economy. You can see from the numbers and the money we go through that we are an important role player nationally.

And this also separates us.”

Looking ahead to the next three years, he says RBM’s goals are broadly similar to those most businesses are chasing. “From our side, it is really positioning the business for the long-term. Number one is a key step change for safety.

I think the business has done well in terms of where we are in safety, but with safety you can never rest.

So this is the first thing we will be looking at to achieve.

EQUAL TO WORLD BESTS “The second is what I call operation excellence; how do we make our operations equal to the best in the world? And here we have opportunities from both a technology and productivity perspective.

“We will also be looking

at costs to see how we remain cost competitive in light of all the headwinds that all mining businesses face. Finally, it will be about people. How do we produce and continue to grow as people in a way that benefits the business here and globally.

“We have got very good people in our business, and part of what we will be looking to do is to see how we can promote them faster.

So these are the four priorities I have; safety, operational excellence, people and costs.”

Being selected as a Young Global Leader has been a humbling honour and privilege, says RBM’s new MD. “I am grateful for the opportunity to work with the World Economic Forum and other YGLs and role players to continue to make an impact in the world.

“What I hope to achieve most is collaboration on projects that make an impact.”

RICHARDS BAY MINERALS +27 35 901 3111 communication@rbm.co.za www.rbm.co.za

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OCTOBER 2017