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Standby capacity for SA mines

5th September 2014

By: Pimani Baloyi

Creamer Media Writer

  

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Harare-based mining equipment supplier Machinery Exchange, in expectation of a time when Zimbabwe’s mining industry can live up to its full potential, prioritises staff training, the supply of high-quality services and world-class equipment and keeping abreast of global trends in its sector, says company co-owner and CEO Brendan Reilly.

Zimbabwe is the fourth-largest diamond producer globally, has the world’s second-largest platinum reserves and also boasts rich nickel, coal and chrome deposits. However, there is not enough investment in the country, owing to policies stipulating that previously disadvantaged communities around mine sites must have 51% ownership of mining projects, states Reilly.

He tells Mining Weekly that the lack of recent investment means that there have been few, if any, business opportunities for local suppliers, who also have to compete for business with South African and other foreign-national-owned businesses.

“I was born and bred in Zimbabwe. I believe in its potential and would like to see the country grow into the powerful economy that it has the potential to become,” he says, adding that there should be commitment to developing local businesses to achieve this.

Reilly explains that, in addition to, or as part of, the indigenisation policy, he would advise government to draft regulations outlining that, in accordance with a designation percentage, all major mining companies must use a stipulated amount of local equipment and service providers.

Machinery Exchange’s service offering includes the supply of imported mining machinery, maintenance and related services, product engineering and specification, as well as advisory services.

The company has been in existence since 1954 and was bought by the Reilly family ten years ago. In the past three years, the company has focused on growing its expertise.

Reilly says the company staff is well equipped, with its technicians having received training in various areas of expertise during several courses in South Africa. However, he notes that, while Machinery Exchange has a lot of capacity for work, it is currently underused.

“We want to carry the flag for Zimbabwe because the country has a very proud mining industry and we don’t want it to collapse. We cannot always rely on South Africa to come and show us how it’s done.”

Reilly notes that Zimbabwe suppliers also have to deal with the challenge of receiving late payment for services or products. “There’s not enough money in circulation. Everyone pays everyone else late because they are waiting for someone else to pay them.”

He adds that there is a liquidity crisis in Zimbabwe because there is not enough new money or investment coming in, with access to finance to grow a business also being a challenge. “This has led to deflation in the country because everyone is trying to get work and pay their bills. Everyone is trying to cut costs and lower prices just to keep in operation.”

Current Projects
Owing to Zimbabwe’s proximity to Mozambique, Reilly believes that Zimbabwe businesses should focus on expanding into Mozambique.

“Machinery Exchange plans to expand into Mozambique. We have worked in the country before and we understand how business operates that side. Zimbabwe is close to Mozambique – about four hours’ drive from Mozambique’s coal mining areas,” he explains.

He adds that an expansion process is under way, but that the company will supply Mozambique clients from its Harare office.

Meanwhile, Machinery Exchange has been contracted by mining contractor Atlas Copco to maintain and service the contractor’s engines. “The contract was signed last year and requires us to monitor their engines, and provide regular maintenance and servicing.

“We also provide heavy engineering repair services for platinum miner Zimplats and have completed work for one of the company’s underground mining machines, where we have also repaired buckets, bins and H-frames and serviced the company’s rehabilitation earthmoving equipment above ground.”

In the past three years, Machinery Exchange has sold three Terex Rigid mining trucks, 65 Powerstar Trippers and seven Santui earthmoving equipment units, states Reilly.

Based in Harare, Machinery Exchange has an office in Bulawayo, with machines throughout the country.

Edited by Samantha Herbst
Creamer Media Deputy Editor

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