The continued downturn in commodity prices has affected mining operations globally; however, multidisciplinary construction and engineering group Aveng’s mining division has deployed responsive strategies that will sustain its operations during these trying times.
Addressing a group of investors during a mine visit at the Nkomati nickel mine, in Mpumalanga, last month, Aveng Mining MD Stuart White indicated that, although the weak rand somewhat shielded the local mining sector, this could not fully compensate for the new decade lows in commodity prices.
Further, the global economic environment and a decrease in commodity prices had contributed to a slowdown in mining investment. In South Africa, this was exacerbated by labour and electrical power challenges, said White.
“This has also caused margins to shrink, owing to operating cost pressures and demand weakness. Moreover, new mining opportunities have been limited across most commodities, which has seen the postponement and scaleback of existing projects over the medium term being the norm,” he explained.
However, to counteract the current market situation, Aveng Mining has retained existing work through close customer contact and ongoing superior performance as well as engaging with its clients and suppliers on cost-saving initiatives. The group has also continued to ensure that it maintains diversification in its projects.
Giving an update on all its operations, White highlighted that, out of the ten mining operations that Aveng Mining is currently working on, eight were meeting current market expectations and were functioning well. The other two – the Chuquicamata operation, in Chile, and the Bakabung operation, in South Africa – were presenting challenges under current conditions, which were, however, manageable, he insisted.
Being particularly impressed with improve-ments that have taken place at Nkomati mine since the commencing of a five-year contract in July last year, White mentioned that there had so far been a fast-tracked selection and recruitment process as well as intensive training conducted to ensure that the operation strove towards zero fatalities at all times.
“We have instilled a safety culture, which has placed emphasis on work ethic, leading to the achievement of zero injuries in the first quarter of 2015,” White pointed out.
This has also led to an increase in production as maintenance strategies were also implemented, which led to the pit conditions improving, he noted.
Focusing on the future, White said that the group would continue to improve operations and further improve pit conditions. Also, Aveng Mining planned to optimise equipment availabilities, buy crushers to provide floor dressing material, continue training mineworkers and also implement best blasting practices.
Aveng was awarded the five-year contract at the Nkomati nickel mine for the joint venture between diversified miner African Rainbow Minerals and global nickel producer Norilsk Nickel Africa in December 2013. The contract to mine 30-million tons of waste and ore a year was scheduled to commence in September 2014 but an early start was negotiated.