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Group Five’s largest business cluster, construction, is driven by a single strategic goal: to position itself as the mining construction partner of choice for all major and junior mining companies across Africa, writes Laura Cornish.

The BEE Level 2 rated company has the ability to extract value from the full infrastructure lifecycle, with the capability to deliver over the whole cycle, from development and investing to building, operating and servicing. Currently43% of the Group Five construction order book is multi-disciplinary work. This highlights the group’s ability to delivering a project from start to finish, across its entire lifecycle, which provides multiple revenues and a blend of margins.

While the construction cluster is one of five within the Group Five group, comprising both the civil engineering and projects divisions, the overriding growth objectives are aligned.

 A single, aligned growth strategy

“We may already be the largest structural, mechanical, electrical and piping (SMEP) EPC contractor in Africa, picking up between 60% and 80% of our targeted new-builds in Africa, but we remain driven to have the mining industry recognise us as its preferential contractor of choice,” says Group Five Projects contracts director, Tony de la Motte.

Group Five’s civil engineering contracts directors, Nelson Alfaiate and Gerry Henny, agree. “A significant portion of our current and historical market share has been in the construction of new and the upgrading of existing mines and mining infrastructure across the full spectrum of resources. Our strategy is to position the group as the mining construction partner of choice. We have a strong track record in the mining sector and are well positioned to continue serving this market effectively,” Henny outlines.

“Our focus lies predominantly on the emerging infrastructure and commodities growth in Africa, with a growing pipeline in road, rail, ports and power. We have a proven track record of delivering on mining construction in very remote locations in Africa, which involves enormous logistical and people management, something we have done successfully for an extended time. It requires an understanding of timelines and planning adequately to avoid delays, managing various interfaces and problem solving on a daily basis,” Alfaiate continues.

Group Five has an extensive African footprint and attributes its growing success to its ability to secure repeat business with both mining houses and all major EPCM clients. “We offer solid working experience across all African countries, with locally based expatriates who understand each country’s cultural, legislative and compliance requirements and know how to accommodate them accordingly. This has ensured our solid track record for building to clients’ specifications and consistently meeting the required time schedule,” says Group Five Project estimating manager Kevin Burnard.

Group Five’s Projects division has 16 years of working experience in Ghana, 14 in Mozambique, seven years in Burkina Faso and the DRC, and five in Tanzania.

Strong commitment to corporate social initiatives

Group Five commits 1% of its African project value to corporate social initiatives, which indicates its commitment to sustainability and local community support. More recently this includes maternity clinics, orphanages and schools.

“We have also started establishing training schools, with facilities already operating in Ghana and Burkina Faso,” says Group Five contracts director Donovan Carroll.“We are currently building one of the first practical training schools in the DRC.”

Carl Phenix, another Group Five contracts director, adds that the training facilities are fully accredited and provide training from artisan level up to management supervisory level.

Its wholly owned subsidiary Everite Building Products, which pioneered the creation of Advanced Building Technology (ABT) five years ago, is providing a fast and efficient alternative to traditional building practices – ideal for Africa’s infrastructure requirements in remote African locations. ABT involves building with a lightweight steel frame clad with Everite Fibre Cement cladding and lined with Everite flat sheets. A variety of external and internal finishes can be applied depending on a client’s specification

Fast to erect, stable and robust buildings (such as offices, construction camps, kitchens, ablutions, labs, guard houses) are the ideal solution for mining houses looking to establish the necessary on- and off-site infrastructure required to see the mine fully functional.

Everite is introducing a new product to the market that targets the quick erection of buildings in remote areas. See the story on page 90 for further information on ABT and Flatts.

 Striving for excellent safety

Group Five establishes a non-negotiable zero-harm safety culture on every project. Safety awareness, training and risk identification are at the forefront of its entire project safety plan. Due to the diverse nature of the health and safety of people, the environment and host communities across Africa, unique strategies and leadership to ensure adherence and compliance are essential. Group Five has had no fatalities in the last 10 years and saw an improvement in its disabling injury frequency rate from 0.54 to 0.21. The goal, however, is zero injuries or fatalities.

The company has achieved numerous safety awards, including:

 

  • Rio Tinto ilmenite project in Madagascar –Safety excellence award
  • BHP Billiton’s DMO coal project –BECSA achievement
  • Anglo American Platinum –safety award for 2 million man hours
  • Maandagshoek mine – Safety award for 20 000 lost-time injury-free shifts
  • Central Ashanti Gold – 1 million lost-time injury-free shifts
Group Five Projects’ current and recently completed work portfolio

“While the countries we are currently working in are opening up extensively, we are constantly looking to expand our reach and footprint even further. The market is very buoyant and we are actively pursuing projects in Tanzania, Kenya, Ghana, Burkina Faso, the DRC, the Ivory Coast, Mozambique, Namibia and Guinea,” De la Motte and Carroll point out.

In addition to having worked on eight major copper and cobalt projects in the DRC’s Katanga province alone, the division is underway with the entire SMEIP contract for the Randgold Resources/AngloGold Ashanti jointly owned Kibali gold project, which will be one of the largest gold operations in Africa.

“We are working alongside DRA for this project, following the very successful working relationship we established with the company for Perseus Mining’s Edikan gold project in Ghana. This alone is proof of our successful ability to secure repeat business with clients.

The division has an additional SMEIP contract with Newmont Mining’s Aykem gold project in Ghana, SMPP contracts with Blackthorn Resources’ Perkoa Zinc project in Burkina Faso, African Barrick Gold’s North Mara crusher in Tanzania and Buswagi mine in Geita, as well as its second coal plant in two years for Jindal Africa in Mozambique.

The company is also extremely proud of its contract with Exxaro’s  Grootegeluk Medupi Expansion Project (GMEP), which will supply Medupi with a dedicated coal stream of 14.6 Mtpa of coal for at least 40 years. “We were awarded the fabrication, supply, installation and commissioning of the structural steel components, free issued mechanical equipment and components, as well as all piping for the run-of-mine (ROM) feed conveyors from inside the pit to the ROM bunkers, and from the ROM bunker to the reclaim conveyors. The discard bunker and its feed conveyors, as well as the two reclaim conveyors and transfer areas, also formed part of the scope of work,” says Group Five projects construction director Chris Willemse.

Group Five Civil Engineering’s current and recently completed work portfolio

“We have tendered on numerous mining projects, with many in the pipeline awaiting award,” says Henny. The following projects are currently in execution: a copper project for ENRC’s Boss Mining in the DRC, Kibali gold mine, the Mongbwalu gold project in the DRC for Anglo Gold Ashanti, and the Kalagadi manganese project for Kalahari Resources.

Completed flagship projects include First Quantum’s Frontier copper project and Kansanshi copper mine in Zambia, and African Barrick Gold’s Lumwana mine in Zambia.

The differentiating factor

One of the group’s differentiators in the market is that it has a concessions and manufacturing business alongside its core construction division, which ensures diversification. The annuity-type businesses of investments and concessions and manufacturing are particularly relevant against volatile construction markets. The concessions business is well positioned for the current and new markets in power and regional transport infrastructure. Its turnkey or EPC delivery capability is also an area of growth.

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