Companies need to look beyond cautionary measures and continue strategic growth into new markets, despite the current global economic crisis, reports diversified consulting engineering firm TWP Consulting CEO Digby Glover.

While Glover acknowledges that the crisis is starting to have a profound effect on many companies, and that the worst effects of the crisis have not yet been felt, he reports that if companies do not continue to seek opportunities, the long term negative impact of the crisis may be even more significant. He says that, rather than putting expansion plans on hold, companies should be selective about the direction in which they plan to expand.

"Mining projects, particularly deep level shaft projects, may take up to 15 years from concept to commissioning. Therefore, current commodity prices will have little impact on the overall project business case. If the cash flow is available, these projects must go ahead, as mining houses cannot decide to ‘switch production on overnight'. This long term project work is key for TWP and will provide security through the current economic environment," says Glover. He adds that there are many projects on the African continent that can provide this security.

He adds that if companies do not expand, the retention of highly skilled professionals becomes difficult.

Rocky Road
Glover reports that it is likely that TWP Consulting will not be expanding as aggressively as it has been doing over the past three years.

"Since 2005, TWP Consulting has been expanding aggressively in line with a large commodity demand, driven largely by the expansion plans of emerging eastern markets such as China and India," he says.

He adds that the economic crisis has had some effect on TWP Consulting, in that a small portion of its project portfolio has been moved out. This has not been altogether unwelcome, as it has allowed personnel to focus on other pressing work. The company however is still focused on expanding into Africa and will do so off the back of large scale projects which have an execution period of between eight and fifteen years.

Diversified Project Mix
Glover reports that although there has been significant growth in the local market, the company has been able to secure a diversified mix of projects on the African continent.

Apart from Zambia, which presents TWP Consulting with the greatest potential for significant growth, the company is actively pursuing notable growth in Zimbabwe.

Glover reports that the driver of this growth is the fact that Zimbabwe has the second biggest platinum ore body in the world, which is largely untapped at present.

"TWP Consulting has executed a number of significant projects in Zimbabwe, the most significant of which is the Unki Project, which Vhumbanani, a joint venture between the TWP and fellow consulting engineering company DRA, is in the process of executing for platinum giant Anglo Platinum," says Glover.
TWP Consulting also recently commissioned a process plant project for Bindura Nickel.

"Zimbabwe definitely offers TWP Consulting significant potential for growth. However, it is waiting for the political situation to settle down before establishing a presence in Harare," says Glover.

He adds that the company is in the process of assessing the best method to establish this presence.

Moving further north, Glover reports that TWP Consulting has secured a project with diversified Canadian mining company, First Quantum Minerals, to dewater its Frontier mine in the Democratic Republic of Congo (DRC).

The Frontier mine is an opencast copper mine which in located in the mineral rich copperbelt region. The mine requires a 500 m shaft to be sunk below the operations to be used for dewatering.

The design includes an underground pumping station, which needs to pump a significant amount of water out of the bottom of the proposed shaft. This was a significant challenge, as the DRC has some of the wettest mines in the world," says Glover.

Moving closer to home, Glover reports that the company has received significant interest in developing coalfields in neighbouring Mozambique. He adds that this development will be significant for the company, as the coal fields are believed to be on the same scale of the coal fields found in Witbank, Mpumalanga.

New Mining Countries
Glover reports that there have been a number of requests to develop mining projects in countries that are not traditionally regarded as areas of mineral wealth. Examples of these include Sudan and Libya, with multiple commodities ranging from gold to cement.

Glover indicates that there is additional opportunity to undertake mining project work in relatively under-developed countries, since in many cases all supporting infrastructure also has to be developed to access and support the mine.

African Outlook

Glover notes that the outlook for TWP in Africa is positive.

"TWP has identified a number of key expansion areas in Africa where the company feels it needs a presence. Within the next year, the company will be setting up an African office in Zambia, and once the Zimbabwean political situation improves, an office will be established in Harare. Because of the significance of the coal fields in Mozambique the company is eager to have a core team on the ground there, while the political stability of Namibia also appeals to the company," says Glover.

He adds that TWP Consulting will be repeating its current regional office model when establishing its African offices.

Glover explains that with the regional office model, the majority of the work will be run from the company's head office in Johannesburg, Gauteng. A team of engineers with necessary core expertise backs this up on the ground at regional mining operations. These offices are typically small in size and are not staffed with more than 100 professionals.

These offices have the capability of running a small to medium-sized mining project, but don't have the capacity to execute a multi-million type project in isolation.

"When moving into Africa, the core mining expertise will be imported from South Africa, complemented by local expertise," concludes Glover.

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