Building a prosperous black-owned company in South Africa takes visionary leadership and courage, according to the management team of Exxaro. For them, the environment and community development are of the utmost importance. Mientjie Kleinhans finds out what makes this company rock.
Since its establishment during a time when BEE legislation offered many opportunities until now, Exxaro has faced and overcome many challenges. But it is not only visionary leadership and courage that led the company to great heights; there were other factors at play as well.
“A key aspect in achieving so much is the calibre of the people employed by the company. We have smart, hard-working people who have worked with us to get us through the difficult times,” says Mzila Mthenjane, executive head: Stakeholder Affairs, Exxaro.
“We will be building on this people foundation by emphasising excellence in all our business activities, following the review of our business model during 2016,” adds Mxolisi Mgojo, CEO of Exxaro
Mthenjane adds that the company has great resources in terms of people and coal. It has made some good investments, and some not-so-good investments, and has applied the lessons learnt from the latter. “We are also an entity that has demonstrated that we are sensitive to the environment. We have also adhered to the transformation legislation in the Mining Charter and, in many instances, outperformed the targets,” says Mthenjane.
The ability to connect with communities is a challenge for the company. “We spend a lot of time trying to demonstrate the good that we do. We closely examine our past interactions with communities to determine where we might be missing the opportunity to build the kind of relationships that really provide an environment where our operations can exist in harmony with communities.
“Communities can see the benefit of having those operations in place, but I think there are much bigger problems in communities than what a single company or operation can manage in the short term. We need to be long term in our perspective and look for opportunities where we can make a sustaining and real difference,” explains Mthenjane.
The company has done much for communities close to its operations; most recently, it demonstrated its efforts with the community close to a new mine in Belfast, which will be directly affected by its planned operations. The community will have to be relocated and the company has been going through a structured relocation and engagement programme with the community.
This engagement involves determining how the community will be impacted, finding a new location, and designing appropriate houses for those being relocated. “To ensure that the relocated households are not further inconvenienced, all the amenities they are accustomed to will be within close proximity to the new location. The new houses will be built better than the current homes, and the sustainability of the residents’ livelihoods will be a priority,” says Mthenjane.
He adds that the company’s entire approach towards its socio-economic impact has been to improve the livelihoods of the community. Therefore, the company takes a holistic look at the quality of life residents will experience throughout their time in the community.
The Belfast mine will replace coal tonnes previously produced from the Inyanda Mine that closed in 2015. The volume of the new mine will also contribute to an increase in export tonnes. The new mine will be opencast and will result in various new jobs being created.
“It is a greenfield project with a new mine design, a new location for a new pit, and there will be new processing facilities. All the coal produced will be destined for export,” says Mthenjane.
“We are not making the mistake of leaving the environmental considerations until the end of the mine. In our planning of this new mine we have ensure that we have the least impact on the community and the environment, both during development and operation,” says Mthenjane.
He explains that, while mining, the company will minimise the impact on the environment in two ways. Firstly, the mine has been designed, from the beginning, to have a water treatment plant to ensure better water stewardship in the area, which is sensitive due to the nearby wetlands and the agricultural activities.
Secondly, the mine will continuously and immediately rehabilitate the area while mining. “We will investigate the potential of using the surface of the land, which could be rehabilitated for agriculture without putting a burden on the environment or changing the biodiversity,” explains Mthenjane.
Other than the Belfast mine, Exxaro will also be investing in Leeuwpan, Mpumpalanga, by developing an extension of the existing mine.
Enterprise and supply development
As part of the company’s enterprise and supply development plans, it is investigating the best possible ways to develop and invest in local businesses. “At Belfast, for instance, we will look at the services required and provision thereof. We also plan to invest large amounts of capital in both the Lephalale and Mpumalanga projects. We want to have a lasting impact in terms of the procurement and development of those projects. Over the next five years, we will be spending close to R17 billion on coal projects in these two areas,” says Mthenjane.
Exxaro still sees a future in coal, as it has been an important element in South Africa’s energy value chain. “We have also invested in wind farms, as we are very interested in the energy space, not just in energy generation, but energy services as well.
“With coal being the biggest part of our business today and looking at the potential challenges going forward, we are investigating other opportunities as well, such as commodities that are essential to the sustainability of human life,” concludes Mthenjane.