Tag Archives: West Africa

Master Drilling continues diversification plan in uncertain market

Master Drilling Group continued to add to its client and service base over the course of 2020, with bright spots reported in exploration drilling and the West Africa gold sector.

Its 2020 financials were hit by COVID-19, with revenue dropping 17% year-on-year to $123.1 million and operating profit declining to $12.3 million, from $24.1 million in 2019.

Danie Pretorius, CEO of Master Drilling, said: “Master Drilling’s overall performance for the year was weighed down by the weak global economic growth environment entering 2020, which was compounded by the material impact of COVID-19, across the 23 countries in which we operate, from a human, financial and operational perspective.

“Although the group experienced a significant decline in revenue in the South American operations, primarily due to government-imposed COVID-19 restrictions, this was offset by regions such as India, Africa and Scandinavia which remained operational and received various stimulus packages.”

Despite a decrease in revenue, the company’s net cash generation increased 72.7% to $25.5 million as it contained capital expenditure by balancing maintenance with emerging opportunities.

In the second half of the year, Master Drilling was awarded new exploration projects and mobilised an additional fleet to service existing clients, with a considerable turnaround in drilling and exploration activity becoming more apparent and creating a healthy pipeline, it said.

Around a year ago, Master Drilling fulfilled the conditions to acquire Geoserve Exploration Drilling, increasing the South Africa-based company’s ability to offer exploration drilling, reverse circulation drilling, geotechnical investigations and grade control drilling services.

Its commitment to Africa saw the continent become the largest contributor to the group in terms of revenue and profits over the course of the year. Aggressive expansion into West Africa continued as part of the group’s diversification strategy, with a specific focus on gold, which has seen a surge in demand since 2019.

Master Drilling also continued to grow its presence in new markets, including Australia, Russia and Central Asia. It secured new contracts with a focus on raiseboring and mechanised mining services, too.

As at December 31, 2020, Master Drilling’s sales pipeline totalled $539.9 million with a stable order book of $212.8 million (2019: $142.1 million).

“In the short to medium term, the sales pipeline is expected to normalise and increase with further tactical acquisitions and joint ventures supporting performance,” it said. “Opportunities to diversify outside of the traditional drilling business into areas such as artificial intelligence will also continue.”

Although capital has been tightly managed in response to the uncertain environment, Master Drilling says technological innovation remains a key priority for the company.

Aligned to this, Master Drilling announced a 40% investment in AVA Solutions, a specialist in data-driven mining fleet management solutions, this month.

Commenting on the investment, Pretorius said: “Our recent investment in AVA is aligned with our strategy to diversify our services and invest in businesses that help us meet our clients’ demand for increased mechanisation and digitisation. Other opportunities with low capital requirements and short return cycles are currently under review.”

He concluded on the annual results: “Although the shape of recovery remains uncertain, we have seen a turnaround in the past six months across the commodities and regions that we are already exposed to. Having made significant investments in our fleet, technology and geographical diversification over the past couple of years, we are now positioned to capitalise on the predicted commodities bull run without requiring additional capital investment.”

BME keeps supply up amid lockdown as it prepares for COVID-19-related business changes

COVID-19 lockdown restrictions around Southern Africa have thrown the spotlight on mines’ supply security, with key inputs like explosives and blasting services among these.

According to Albie Visser, General Manager at blasting specialist BME, mines have relied heavily on the flexibility and ingenuity of service providers to keep the supply chain functioning.

“The first weeks of the lockdown were challenging, especially regarding the logistics of moving our emulsion product across national borders from South Africa into other southern African countries,” Visser said. “Different countries – and even different border posts – applied different rules, making it difficult to know what the exact compliance requirements were.”

Albie Visser, General Manager at BME

He noted the pandemic had caught most authorities unaware, leading to regulations being hurriedly developed and enforced.

“In some cases, the regulatory requirements were not practical,” he said. “At one border, for instance, drivers were required to have a COVID-19 test not older than three days – but in South Africa it took nine days to get results from a test through normal channels.”

This meant that innovative thinking was called for, and BME worked closely with its own suppliers and the mines themselves. While some deliveries were initially delayed by border issues, the company’s responsiveness and agility kept up its deliveries to site, it said.

National lockdowns in the region affected the mining sectors differently from country to country.

“South Africa’s lockdown saw demand for emulsion drop sharply at first, but this has almost returned to normal as mines ramped up to full production where possible,” he said. “While mining in Botswana has slowed, Namibia’s mining industry has been more resilient and our supplies to Zambia are almost unaffected.”

Site precautions

In South Africa, BME is working on many mine sites, with an average of three teams per site. By conducting risk assessments and adapting its existing safety systems, BME quickly developed its own COVID-19 protocols in line with national safety regulations – even before some of the mines finalised their own systems.

Among the measures BME has applied is to divide staff into small groups to keep closer control of movements and restrict infections. For example, each group will stay together for transport purposes, and will use only one specified bus.

“Each bus, which has a thermometer for daily testing, will collect staff from their homes,” Visser said. “We know exactly who they live with, for purposes of future contact tracing.”

It does mean more buses arriving at the work site, but any infection picked up can then be controlled and traced within that group. There is also another screening test at the mine site when staff arrive, and the necessary social distancing is observed.

“To date our measures have been very effective, with no COVID-19 infections at any of our operations,” he said.

Overcoming barriers

Outside of South Africa, there have been some notable achievements in the face of COVID-19 related lockdowns.

Joe Keenan, Managing Director of BME, relayed a few of these.

Joe Keenan, Managing Director of BME

“Among the logistical achievements, for instance, was the timeous shipping of resources to customers in Australia and West Africa – which was done in anticipation of the lockdown,” he said.

BME was also able to continue satisfying the requirements of one of Zambia’s largest copper producers, despite the difficulties of negotiating border regulations.

At the same time as this, the company is continuing to roll out large projects for major customers, while keeping most of its staff working remotely. This includes the recruitment of about 170 people for one key project, and the continuation of on-site testing.

Automation, remote optionality

From the manufacturing perspective, BME’s facilities are also well positioned to keep feeding the supply chain even under lockdown conditions, according to Ralf Hennecke, BME’s General Manager: Technology and Marketing.

“Most of our production plant processes are highly automated, so we can readily apply the necessary social distancing and minimise staff without affecting production,” Hennecke said. “This applies to our explosives facilities as well as our factories for non-electric and electronic detonators.”

Ralf Hennecke BME General Manager: Technology and Marketing

BME has put in considerable investment in the automation of its manufacturing plant at Delmas in Mpumalanga, South Africa, for instance. While the driver for this process was primarily the quality of its emulsion product, the effect has been to enhance security of supply while applying strict social distancing protocols, it said.

Keenan said: “At our facility in Losberg, Gauteng, where we manufacture our AXXIS™ equipment and non-electric detonation systems, there is also a high level of automation. We can therefore accommodate the COVID-19 regulations without affecting the value chain.”

Even the company’s remote bulk emulsion plants – often located on customer’s mine sites – can be operated with minimal staff.

Hennecke highlighted that BME’s technology, including planning and reporting platforms like BLASTMAP™ and XPLOLOG™, also assist mines to reduce opportunities for COVID-19 transmission.

“Our technological innovations allow data to be digitally captured, stored and transferred to the mine’s operational and administrative systems,” he said. “This can be done safely with only a few human touchpoints, and also in real time for greater efficiency.”

The future

While the current efforts are to keep mining operations running normally, the future will see considerable changes in how suppliers like BME support customers, according to Keenan.

“The leveraging of technological innovation to keep mine sites safe and efficient becomes an even more vital imperative for technology providers,” he said.

Operationally, there will be ongoing focus on social distancing and digital processes to reduce proximity between employees.

With strict requirements limiting face to face interaction, more communication with customers will also have to be conducted digitally.

These communication systems will also have to be adapted to streamline the sales process and keep contracts flowing, according to BME.

“Creative solutions will need to be found for how to manage tenders, for example, especially where site visits are required,” Kennan said. “There are still various practical issues to be resolved so that normal procurement can continue.”

In terms of further expediting the shift to non-contact interaction with customers, BME’s new enterprise resource planning system enhances its shared services capacity, allowing less paperwork and more electronic documentation and processing.

Dundee’s GlassLock Process engineers an opening at West Africa gold mine

Dundee Sustainable Technologies (DST) and its proprietary GlassLock Process™ is to help a West Africa mine stabilise legacy arsenic-bearing material at its gold operation following a new mandate agreement.

The mandate agreement, entered on June 8, consists of delivering an engineering package for a plant using DST’s GlassLock Process. It follows a preliminary metallurgical test program with the same customer from back in the March quarter.

This program saw over 40 kg of arsenic- and gold-bearing material received at DST’s technical facilities in Canada, whereby DST successfully combined gold recovery with the stabilisation of arsenic using GlassLock, it said.

A glass product containing over 15% arsenic was generated and successfully met the requirements of the United States Environmental Protection Agency’s toxicity characterisation leaching procedure (TCLP, Method 1311), DST said.

“As a result, the customer awarded the engineering mandate to DST to perform process optimisation and an engineering study at the prefeasibility (+/-25%) level,” it said. “The agreement includes engineering fees in the amount of C$101,000 ($74,436) to be paid to DST for this work as per its business plan to generate revenues for the corporation while the technology is progressing toward implementation.”

The final report is due at the beginning of September 2020, DST said.

Back in May, DST announced it had entered into a commercial agreement to provide engineering services to a gold and copper producer for a full-scale plant of its GlassLock Process as part of a C$600,000 Class 4 engineering package.

Since the construction of its pilot plant in 2016, DST has continued to demonstrate the validity of its technology, moving from pilot level to the industrial demonstration scale, where arsenical material was processed to generate vitrified arsenical glass, containing up to 20% arsenic while meeting the TCLP Method 1311.

“GlassLock is becoming an effective and cost attractive technique to segregate arsenic and is therefore opening new opportunities for arsenic-bearing precious metals deposits, concentrates or contaminated sites considered to contain too much arsenic to be exploited,” the company said.

This agreement is another major achievement in DST’s commercialisation efforts, it added.

West Africa investments about to pay off for Capital Drilling

Capital Drilling’s push into West Africa will start paying off in the second half of the year, according to Executive Chairman, Jamie Boyton, with the contractor having sealed a number of drilling agreements in the region in the opening six months of 2019.

The company has progressively invested more resources in West Africa over the past few years, aiming to capture market share in a region where gold exploration is high.

The company recorded revenue of $54.7 million over the six-month period, a 0.4% year-on-year increase, while its average revenue per operating rig dropped to $183,000, compared with $200,000 in the first half of 2018, primarily due to new contract mobilisations. The group maintained guidance on anticipated revenues for the current financial year of $110-120 million, with revenue expected to increase in the second half of this year.

During the period, the company purchased an additional blasthole rig for the long-term contract at Centamin’s Sukari gold mine, in Egypt, as part of the group’s ongoing fleet management; made further progress in the establishment of its West Africa operations, with drilling commencing in Burkina Faso with Golden Rim Resources in May; and was awarded its first drilling contract in Nigeria with Thor Explorations Ltd, with drilling scheduled to commence in the December quarter.

The company also, in these six months, appointed Jodie North as Chief Operating Officer, increased business development resources, appointing Chris Hall to position of Business Development Manager, West Africa, maintained its ongoing rig improvement program and achieved a number of safety records at the likes of Sukari, North Mara (Tanzania), Geita (Tanzania), Tasiast (Mauritania) and Syama (Mali).

Boyton said: “The first half of the year was focused on further consolidating Capital Drilling’s presence in the highly active West African market, with a number of new contracts awarded, which will contribute to group revenues from the end of Q3 (September quarter). This strong push into this region has seen the commencement of our first drilling contract in Burkina Faso during Q2.

“Today we have also announced our expansion into Nigeria from Q4 (December quarter), a mineral rich, yet poorly explored country with significant potential, where we already operate a successful mineral analytics laboratory. Pleasingly, our major operations have also continued to achieve significant safety milestones throughout the first half.”

New contracts awarded during the first six months include:

  • Compass Gold Corp (Sikasso, Mali, pictured). Awarded a 10,000m exploration drilling contract, using one reverse circulation (RC) and one diamond rig from the existing fleet. Drilling commenced in June;
  • Golden Rim Resources (Kouri, Burkina Faso) (previously announced). Awarded a 20,000m exploration drilling contract using one multi-purpose rig from the existing fleet. Drilling commenced in May;
  • Allied Gold Corp (Bonikro, Côte d’Ivoire). Awarded a five-year exploration drilling contract, using one diamond rig and one RC rig from the existing fleet. Drilling is scheduled to commence in December quarter;
  • Thor Explorations Ltd (Segilola, Nigeria). Awarded a five-year exploration and grade control contract, using one RC rig from the existing fleet. This will transition to grade control in 2020, with exploration drilling scheduled to commence in the December quarter and grade control in H1 2020;
  • Kinross Gold Corp: (Tasiast, Mauritania): MSALABs was awarded a three-year onsite laboratory services contract with Kinross at the Tasiast gold mine. Operations commenced in July 2019, and;
  • Resolute Mining Ltd (Syama, Mali). Awarded one-year extension of the long-term underground grade control drilling contract using two underground rigs from the existing fleet. Contract extended to June 2020.

Multotec on the front line of West Africa mineral sampling scene

Multotec Process Equipment says the growth and diversification of West Africa’s mining sector is making the precision of mineral sampling a “vital priority”.

For over two decades, Multotec has been active in the West Africa market, with its samplers at over 30 sites in countries including Ghana, Liberia, Burkina Faso, Guinea, Sierra Leone, Mali and Guinea-Bissau. A range of commodity sectors use the equipment for both slurry and dry sampling applications, among them gold, bauxite, iron ore and heavy minerals.

Multotec has also presented representative sampling training courses explaining the practical aspects of implementing the Theory of Sampling (TOS).

Willem Slabbert, Process Manager at Multotec Process Equipment, said: “In bulk minerals like bauxite – where our sampling plants have been in operation with a major West African producer for 17 years – the sampling protocol and ‘correctness’ of equipment design is key to ensuring bottom-line success.”

He highlighted the importance of reproducible and accurate sampling – cumulatively termed representative – at the interface between the mine and port, and on the ship-loading conveyor to the client.

The sampling, which must comply with ISO standards and best practice as prescribed by the TOS, confirms the mine is supplying product to the end-customer’s contractual specification. “Any imperfection in the sampling process can lead to unnecessary contractual disputes and potential financial losses for the mine or client,” Slabbert says.

Multotec supplies wet slurry samplers to several gold mines in West Africa, who rely on good gold accounting and reconciliation at their processing plants. The equipment is popular among large gold producers as well as the smaller entrants, according to the company.

“With a comprehensive range of Two-In-One, primary and ancillary samplers, we are able to tailor each installation to the customer’s specific application,” Slabbert says. “This means accommodating variables like throughput rates and slurry densities, including accounting for grade variability from various mine sources feeding a single processing plant, in many of the West African deposits.”

For brownfield projects, Multotec can design solutions to suit and fit the structural constraints of the customer’s existing infrastructure.

Local service support is available from Multotec’s Ghana branch as well as regional agents and service providers operating in other countries. This ensures a point of contact as first line of support and, drawing on its expertise across a range of disciplines, Multotec can put specialists, engineers, design draughtsmen and millwrights to work on projects throughout the West African territories.

Byrnecut wins underground mining contract at WAF’s Sanbrado gold project

West African Resources has awarded the underground mining contract for the M1 South deposit at the Sanbrado gold project in Burkina Faso to Byrnecut.

The contract, worth $110 million over five years, is Byrnecut’s second in the West African country.

Mobilisation activities are expected to commence in December with portal establishment planned for March.

Works under the contract include underground portal establishment for M1 South, decline and level development of 7 km, ore driving of 2 km and 200,000 t, stope production of 1.3 Mt, and raise drilling and cemented rock backfill.

West African Managing Director Richard Hyde said: “The underground mining contract is a key operational contract for Sanbrado and its award follows the completion of a competitive tender process and extensive due diligence process examining safety, experience and capabilities.

“We are very pleased to award the underground mining contract to Byrnecut who have a long history providing underground mining services globally and have current operating experience in West Africa.”

Byrnecut Group Executive Chairman Steve Coughlan said: “We are looking forward to partnering with West African on the exciting Sanbrado gold project. This project will be our second site in Burkina Faso and fifth project we have operated in the West African region.”

The M1 South underground will kick-off WAF’s mining development at Sanbrado, with the underground development accessing high-grade, free-milling gold mineralisation located directly beneath the proposed M1 South open pit at approximately 120m vertical.

Concurrent mining of the M1 South open pit ore from surface and underground will accelerate cash-flow over the early years of the Sanbrado mine life, the company says.