TERENCE OSBORN Mining Indaba provides an opportunity for new strategic initiatives to emerge through discussions
Minerals and cement industry equipment and services supplier FLSmidth is establishing itself as a productivity partner in the African mining sector in light of mining companies’ focus on improving existing projects, in addition to new greenfield opportunities, amid difficult economic conditions.
The company is, therefore, aligning its product and services offering with the shift in focus, concentrating on extending itself to work closely on site with clients, focusing specifically on companies operating in gold, coal, iron-ore, copper, platinum and fertiliser, as well as local traditional minerals markets.
“You can’t unearth an opportunity for improvement without physically being in the client’s working environment. Our aim is to partner with clients to explore their operations and identify challenges that could benefit from our technological intervention,” says FLSmidth sub-Saharan Africa minerals commercial manager Terence Osborn.
He highlights that events, like the Investing in African Mining Indaba, which will be held from February 6 to 9 at the Cape Town International Convention Centre, are, thus, an important interface where the company can meet with existing and, potentially, new clients to form mutually beneficial partnerships.
Osborn points out that, as a developing continent, there are many mining opportunities in Africa, which is home to vast mineral resources that are relatively underexplored and underexploited. “As social, economic and political conditions in African countries become more stable, there is ample opportunity for exploration activities in the mining sector and profitable exploitation of generally higher-grade deposits.”
However, he notes that, as a result of the protracted period of depressed commodities prices globally for the past three years, capital expenditure in the mining industry has dramatically decreased, dropping by almost 70% since the commodities peak in 2012. Currently, activity levels with regard to new projects are, thus, particularly low.
“Mining companies are generating lower profit margins and the opportunity to reinvest in capital expansion is, therefore, quite low. As a result of the global financial crisis, there has been a fundamental shift in the way projects are debt funded, making it difficult to access funds.”
Mining companies are instead concentrating on ways in which they can improve their existing operations. Osborn highlights that, owing to the vast suite of processing and materials handling equipment that FLSmidth supplies, the company is ideally positioned to assist with this by offering its customers a broad consulting view with a technology focus.
“As such, we are able to advise mining companies with regard to the implementation of specific technologies to debottleneck or improve problematic areas of their operations and, ultimately, assist them in improving efficiency and productivity.”
Osborn stresses that this collaborative, holistic approach is proving highly successful in terms of unlocking value at existing operations and is increasingly being favoured by mines instead of simply buying equipment from an original-equipment manufacturer.
There is, thus, a strong drive within FLSmidth to increase contact between its sales and engineering staff and its customers to offer solutions that are relevant and specific to their operations.
FLSmidth’s after-sales support services are a further crucial element to the company being a productivity partner, as Osborn stresses that mining projects are by nature long-term ventures. FLSmidth has a long and successful record of supporting its operating customers. The company has positioned itself through its spares and maintenance services offering to assist mines for the duration of their life spans, which are often more than 20 years.
“Our business with clients is, therefore, an ongoing, long-term endeavour rather than a one-off sale.”
Osborn highlights that the Mining Indaba is a particularly useful platform for the company to engage with new and existing clients, as it is predominantly attended by senior-level executives of mining companies who have the power to make investment decisions.
“While we are consistently engaging with mining companies on site, our focus for the event is to connect with more senior decision-makers in the mining industry on the topic of productivity partnership. The Mining Indaba provides a highly efficient means of meeting many people in a short time and we hope that new strategic initiatives might emerge through discussions with those at different levels of clients’ corporate structures.”
Osborn highlights that the Mining Indaba’s business matchmaking service has proved highly useful in past years in enabling FLSmidth to reach out to attendees and schedule meetings during the event. The company will welcome new and existing clients at its private meeting room at the event, where representatives from the company will conduct preplanned and ad hoc meetings.