41856 Pip - September 2012 (Second Edition)

8/13/2019 41856 Pip - September 2012 (Second Edition)

1/53Supplement September, 2012

SEPTEMBER 2012

Medupi power st


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PROJECT INDEXENGINEERING PROJECTS 222Electricity 39

Eskoms Ingula pumped-storage scheme 4

Eskoms Kusile power plant project 56

Eskoms Medupi power station project 78

Eskoms return-to-service projects 9

Renewable Energy 1012Department of Renewable Energy Independent Power Producer

Programme first window 11

Department of Renewable Energy Independent Power Producer

Programme second window 12

Industrial Projects 1314

Sephaku Cement projects 14

Petrochemicals and Chemicals 1517

Omnia Holdings nitric acid complex 16

PetroSAs Project Mthombo 17

Transport and Logistics 1820

Sanrals Gauteng Freeway Improvement Project 19

Transnets Durban port upgrade 20

Water 2122

Trans-Caledon Tunnel Authoritys Olifants River Water Resources

Development Project Phase 2 22

MINING PROJECTS 2350Coal 2429

Beacon Hill Resources Minas Moatize coal project 25

Exxaro Resources Grootegeluk Medupi expansion project 26

Resource Generations Boikarabelo coal project 27

Rio Tinto Mozambique Coals Benga coal project 28

Rio Tinto Mozambique Coals Zambeze coal project 29

Diamonds 3031

Debswanas Cut 8 project 31

Gold 3235

Gold Fields South Deep gold mine expansion project 33

Witwatersrand Consolidated Gold Resources Bloemhoek gold project 34

Witwatersrand Consolidated Gold Resources De Bron-Merriespruit gold

project gold project 35

Iron-Ore 3639

Assmangs Khumani iron-ore expansion project 3738

Kumba Iron Ores Kolomela iron-ore project 39

Other Mining Sectors 4043

Discovery Metals Boseto copper project 41

Kalahari Resources Kalagadi manganese project 4243

Platinum 4450

Royal Bafokeng Platinum and Anglo American Platinums BRPM

North Shaft Merensky Phase 3 project 45

Royal Bafokeng Platinum and Anglo American Platinums Styldrif t

Merensky Phase 1 project 46

Impala Platinums No 16 Shaft project 47

Impala Platinums No 17 Shaft project 48

Tharisa Minerals Tharisa chromite and platinum expansion project 49Wesizwe Platinums Bakubung Platinum Mine project 50


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Need for State to play countercyclical project role

Projects in Progress 2012The material contained in this report was compiled by Sheila Barradas and the Research Unit of Creamer Media (Pty) Ltd, based in Johannesburg, South Africa

The information contained in this report has been compiled from sources believed to be reliable, but no warranty is made to the accuracy of such information.

Copyright Creamer Media (Pty) Ltd

With the private sector in a period of constrained project growth, it is good that the State iprepared to enter the fray with its project programme. In this way, there is a semblance ofproject balance and supply and demand forces are kept on a more even keel.

Welcome too is the shift by the South African government away from what was aconsumer-led growth trajectory to one that is increasingly balanced by a recovery in theproductive sectors.

Over the coming three years, some R845-billion has been budgeted for public infrastructurprojects.

Because of its lack of capacity, the State should not shy away from engaging private-sectorcapacity in its infrastructure implementation ambitions. Important frameworks that havethe potential to help achieve project realisation include the National Development Plan, thePresidential Infrastructure Coordinating Commission (PICC) framework for the deliveryof 17 strategic infrastructure projects (Sips) and Finance Minister Pravin Gordhanmulti-layer approach to funding infrastructure. Gordhan has stressed that not all theprojects will be directly government-funded.

Sips spans the big-ticket transport, energy, water, telecommunications and public works

items and it is important that the door is opened for the private sector to assist governmenin its PICC and Sips roll-out.

The National Development Plan is right to call for the urgent stimulation of mining andenergy investment and foresee South Africas global mineral deposit position providingan economic growth opportunity of 3% to 4% a year. Among the central constraints areelectricity shortages and infrastructure weaknesses, especially in heavy-haul rail servicesports and water.

That puts the ball back in the government court and the degree of urgency is emphasisedby the unravelling of South Africas once-proud ferrochrome industry, as a direct result oelectricity issues.

With the lifting of the shale gas moratorium, the way is now open for South Africa tofollow the lead of North America in adding gas to the countrys energy mix, provided theoverall economic and environmental costs and benefits outweigh those associated with South

Africas dependence on coal.

The plan also advocates a search for offshore natural gas resources and wants coal-bedmethane gas opportunities to be taken up, along with underground coal gasificationoptions.

Hopes are also rising for the continent of Africa to begin reaping a demographicdividend, courtesy of its young and rapidly growing workforce and its decliningdependence ratio, and, on the global front, projections to 2025 point to cities around theworld constructing the equivalent of the entire land area of Austria 80 000 km 2 inresidential and commercial floor space, requiring $80-trillion in investment, says AngloAmerican CEO Cynthia Carroll.

Martin Creamer

Publishing Editor

Projects INProgress 2012 1


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INDUSTRIAL PROJECTS

Electricity

Renewable EnergyIndependent Producer Projects

Industrial Projects

Petrochemicals and Chemicals

Transport and Logistics

Water

2 Projects INProgress 2012


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South Africas electricity-generation strategy from 2010 to 2030 is contained in aDepartment of Energy document the Integrated Resource Plan. The plan includes14 000 MW of so-called committed build and 45 637 MW of new build options.Together with the countrys existing capacity, less the capacity that will bedecommissioned in the period, the committed and new-build projects will contributeto a total system capacity of 89 532 MW in 2030.

About 45.9% of the total will be sourced from coal-red facilities, which will havea total capacity of 41 071 MW in 2030. This includes State-owned power utilityEskoms Medupi

(4 800 MW) and Kusile (4 800 MW) power stations, which are currently underdevelopment, and the return-to-service of three coal-red stations Camden,Grootvlei and Komati, which together have a capacity of 3 800 MW.

While signicant new electricity-generating capacity is being brought on stream bythe baseload coal-red projects being pursued by Eskom, these projects have longlead times. The utility, there, had to boost its peaking capacity in the short term tominimise blackouts. One such peaking capacity project is the Ingula pumped-storagescheme, which is expected to have a total capacity of 1 332 MW. The plants will onlybe used when the supply-demand balance is very tight.

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ESKOMS INGULA PUMPED-STORAGE

SCHEME

Name and LocationIngula pumped-storage scheme project, on the border between the FreeState and KwaZulu-Natal (KZN), South Africa.

Client

Eskom.

Project DescriptionThe Ingula pumped-storage scheme, located within the Little Drakensbergmountain range, 23 km north-east of Van Reenens Pass, will comprise anupper dam (Bedford) and a lower dam (Braamhoek). The upper reservoirsite is located in the Free State and the lower in KZN. The escarpmentforms the border between the two provinces.

The distance between the upper and lower reservoirs will be 4.6 km, withan elevation difference of about 470 m.

The dams will be connected by underground waterways, through anunderground powerhouse complex, which will house four 333 MW pumpturbines with a total capacity of 1 332 MW, a machine hall, a transformerhall and associated tunnels, shafts and caverns.

The twin waterways, consisting of part concrete and part steel-linedheadrace tunnels, pressure tunnels and shafts, will link the upper reservoirwith the pump/turbines. Steel-lined extended draft tubes and a singleconcrete-lined tailrace tunnel will connect the pump/turbines to the lowerreservoir.

The upper reservoir will be a concrete-faced rockfill embankment dam41 m high, with total capacity of 22.6-million cubic metres and an activewater storage volume of 19.3-million cubic metres. The lower dam willbe of roller-compacted concrete (RCC), 39 m high, with total capacity of26.3-million cubic metres and an active storage volume of 21.9-millioncubic metres.

The upper reservoir will store enough water to generate electricitycontinuously, using all four units for 16 hours. Pumping the water backfrom the lower reservoir will take about 21 hours, giving an overallefficiency of 76% for the scheme.

ValueR23.8-billion. As at March 31, 2012, R11.1-billion had been spent.

DurationThe first 333 MW unit of the nearly R17-billion project is expected to becommissioned in the first quarter of 2014, with the remainder of the unitsstarting commercial operation in the same year.

Latest DevelopmentsIn June, international lifting equipment manufacturer Konecranes wascontracted by Eskom to provide heavy-duty cranes for its Medupi, Kusileand Ingula sites.

The two cranes installed in the underground machine hall at Ingula eachhave a capacity of 265 t and will be used to install the plants turbine andgenerator components, which include a 146 t spiral case, a 150 t main inletvalve, a 350 t stator and a 450 t rotor.

A further two 8 t cranes and two 12 t cranes have been installed at Ingulafor routine use.

Key Contracts and SuppliersThe Braamhoek Consultants joint venture (JV) consisting of ArcusGibb, Knight Pisold and Stewart Scott (civil engineering, mechanicalengineering, electrical engineering, detailed design, tender documentation,

design monitoring and construction supervision); Murray & Robert(exploratory tunnel); Grinaker-LTA (access roads); CMI JV, comprisingCMC di Ravenna, PG Mavundla and Impregilo (underground civil works)Afriscan (water supply, sewage treatment, small access roads and building

of temporary Eskom offices); B&E Quanza Group (aggregate quarry); Ace[Africa] (environmental consultants); Braamhoek Dam JV, comprisingConcor Roads & Earthworks, Wilson Bayly Holmes-Ovcon (WBHO)Edwin Construction and Silver Rock (dam contract); Voith Siemens HydroPower Generation (electromechanical equipment contract); Atlantis Dril(ventilation shaft) and Sandvik Mining & Construction (raiseboringmanager); Deutsche Bank (R1-billion loan); ABB (electrical balance oplant, or eBoP, solution); NCC Environmental Services (independenenvironmental control officer services) and Konecranes (heavy-dutycranes).

On Budget and on Time?The first 333 MW unit was initially expected to be commissioned byJanuary 2013.

The first unit, however, will now only be commissioned in the first quarteof 2014.

Contact Details for Project InformationABB head of communications Harmeet Bawa, tel +41 43 317 6480,fax +41 43 317 6482 or email [email protected].

Arcus Gibb, Andre Bosch, tel +27 11 519 4600 or fax +27 11 807 5670.

Braamhoek Dams JV (Concor Roads & Earthworks), Eric Wisse,tel +27 11 495 2222.

CMI Mavundla JV, tel +27 36 638 6000 of fax +27 36 8 6017.

Eskom media desk, tel +27 11 800 3304/3309/3343/3378,fax +27 11 800 3805 or email [email protected]; or Katlego Nchoetel +27 11 800 3435 or email [email protected].

Eskom national call centre, tel 0860 037 566.

Ingula Visitors Centre, tel +27 36 342 3122 oremail [email protected].

Impregilo, Giovanni Frante, tel +39 02 4442 2115 oremail [email protected].

Voith Siemens Hydro Power Generation, Barbara Fischer-Aupperle,tel +49 7321 370, fax +49 7321 37 6180 oremail [email protected].

NCC, tel +27 21 702 2884, fax +27 86 555 0693 oremail [email protected].

Konecranes, tel +27 11 864 2800.


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ESKOMS KUSILE POWER PLANT

PROJECT

Name and LocationKusile power plant project, Mpumalanga, South Africa.

ClientEskom.

Project DescriptionKusile will be a six-unit, greenfield, mine-mouth, supercritical coal-firedpower plant, with about 4 800 MW of gross output. It will be built adjacentto the existing Kendal power station, in the eMalahleni municipal area.

Kusile is Eskoms second most advanced coal project after the Medupipower station, which is being built in Limpopo, to meet South Africasenergy requirements.

The project will include a power station precinct, power station buildings,administrative buildings (control buildings, medical and security), roads,as well as a high-voltage yard.

The associated infrastructure will include a coal stockyard, coal and ashconveyors, water-supply pipelines (temporary and permanent), electricity

supply (temporary, during construction), water and wastewater treatmentfacilities, ash disposal systems, a railway line, limestone offloading facilities,access roads (including haul roads), dams for water storage, as well as arailway siding and/or a line for the sorbent (limestone) supply.

The unit will be the first power station in South Africa to have flue gasdesulphurisation (FGD) installed. FGD is a state-of-the-art technology,used to remove oxides of sulphur, such as sulphur dioxide, from exhaustflue gases in power plants that burn coal or oil.

Kusile is also designed to be carbon-capture and sequestration ready,meaning that it is configured to facilitate the necessary installation ofequipment that will capture and transport carbon dioxide emissions to apermanent storage location.

To help conserve water, the plant will use an air cooling system.

The majority of the coal for the power plant will be sourced from AngloAmerican Inyosi Coals New Largo mine (mine mouth) and supportingcoal will be sourced from the Zondagsfontein East No 2 seam a middlingsproduct the Zondagsfontein East No 4 seam and the ZondagsfonteinWest resource, where further exploration is ongoing.

ValueThe project is being developed at a cost of R118.5-billion. As at March 31,2012, Eskom had spent R39.3-billion on the project.

DurationThe first generating unit is scheduled to enter commercial operationby late 2014, with the subsequent five units being commissioned ateight-month intervals thereafter. The last unit is expected to be incommercial operation in 2018.

Eskoms decision to delay the awarding of some of the projectscontracts will subsequently delay the overall delivery schedule, possiblyby 18 to 36 months.

Latest DevelopmentsEskom reports that it has agreed to a capital sharing arrangement withmining group Anglo American for the proposed greenfield New Largo coalmine, in Mpumalanga, which will produce coal for the power station.

The mine is expected to deliver 12-million tons of coal a year to the powerstation.

The agreement still requires final sign-off from Anglo and Eskom.

Meanwhile, Konecranes was contracted by Eskom in June to provideheavy-duty cranes for its Medupi, Kusile and Ingula sites.

Konecranes installed two cranes at Kusiles turbine halls. It will install afurther two cranes in Kusiles turbine hall by early 2013.

Key Contracts and SuppliersNinham Shand Consulting Services (environmental-impact assessmentgeotechnical investigation and traffic impact); AirShed PlanningProfessionals (air-quality impact); Jongens Keet Associates (noise impact)Strategic Environmental Focus, or SEF (visual impacts); Makecha

Development Association (impacts on terrestrial fauna and flora); GoldeAssociates, through Ecosun (aquatic-ecosystem impact); GroundwateConsulting Services (groundwater impact); Ilitha Riscom (risk assessment)Northern Flagship Institution (archaeological impact); Universityof the Free State (impacts on agricultural potential); Urban-Econor UE (socioeconomic impacts); Seaton Thomson & Associates (planninimplications); Mark Wood Environmental Consultants (process review)Eskom; in partnership with Black & Veatch International (projecmanagement and engineering services); Hitachi Power Africa, or HPAa subsidiary of Hitachi Power Europe, or HPE (boiler contract); Actomformerly Alstom P&C (turbine island works); Alstom (turbine contracand distributed control system, or DCS); Mikropul, subcontracted byAlstom (axial-flow fans and auxiliary equipment for the turbine hallsventilation); Murray & Roberts, or M&R (boiler construction contract)

Roshcon, a subsidiary of Eskom (terracing contract); Concrete FinishingEquipment (dust filters and silo and environmental safety); the KusileCivil Works, or KCW Joint Venture (JV), comprising Stefanutti StocksBasil Read, Group Five and Wilson Bayly Holmes-Ovcon (WBHOConstruction (main civil works); BHR Piping Systems (bending machine)Siemens (generation transformers contract); EsorFranki Geotechnicalformerly Franki Africa and Stefanutti Stocks Geotechnical (SSF JV), undea subcontract to the KCW JV (piling works for the turbine, boiler andair-cooled condensers, or ACC); Karina Concor JV (construction of chimneyshells/structures); Alstom in consortium with Cosira (engineering, supplyand installation of FGD system); DSE Structural Engineers & Contractorssubcontracted by Genrec Engineering (fabrication of steel columns foboilers 1 to 3); Steel Services Direct, or SSD (steel, pipes and wax plants)GB Bearings (supplier of HSR horizontal bearing assemblies and profil

bore bearings); Sulzer Pumps South Africa, subcontracted by Actom(supply of booster and boiler feed pumps); Steloy Castings, subcontractedby Sulzer Pumps South Africa (supply of chrome steel components for thpumps); Clyde Bergemann Power Group subcontracted by HPA (supplieof sootblowers for boilers); Clyde Bergemann Africa (fly ash handlingsystem); ABB (supplier of medium-voltage switchgear and associatedequipment); PD Naidoo & Associates (PDNA) Industrial Projects (mainwater and wastewater treatment contractor); GE Water EngineeredSystems, subcontracted by PDNA Industrial Projects (advanced water andwastewater treatment equipment); Bateman Africa (materials handlingcontract); Lesedi Nuclear Services (procurement and supply of the balanceof plant equipment); Grinaker-LTA Metals and Minerals (supply anderection of piping, steelwork and free-issue chemicals); US Export-ImporBank, or Ex-Im Bank (loan finance) and Konecranes (heavy-duty cranes)

On Budget and on Time?The estimated cost of the Kusile project has increased from an initiaR80-billion to R142-billion. In 2009/10 the capital budget was reducedfrom R87-billion to R70-billion.

Eskom has proposed that the project be introduced in June 2014, ratherthan in June 2013, to help accommodate the utilitys proposed lower tarifincreases. However, the Department of Energys Integrated ResourcPlan has kept to the initial plan for 2013.

Contact Details for Project InformationABB media relations, Wolfram Eberhardtor Thomas Schmidt,tel +41 43 317 6568 or email [email protected].

Actom, Mark Dixon, tel +27 11 820 5111 or fax +27 11 820 5100.

AirShed Planning Professionals, tel +27 11 805 1940,


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fax +27 11 805 7010 or email [email protected] press, Philippe Kasse, tel +33 1 41 49 2982/3308 oremail [email protected]; or investor relationsEmmanuelle Chtelain, tel + 33 1 41 49 3738/2136 oremail [email protected] Read investor relations, Enna Kruger, tel +27 11 418 6375,fax +27 11 418 6334 or email [email protected] Africa, tel +27 11 899 9000, fax +27 11 899 4903 oremail [email protected] Engineered Technologies GM Braam Strauss,tel +27 11 201 2300 or email [email protected] & Veatch media relations and communications director GeorgeMinter, tel +1 913 458 8001 or email [email protected].

Clyde Bergemann Africa, tel +27 11 704 0580, fax +27 11 704 0597 oremail [email protected] Bergemann Power Group, tel +49 281 815 101,fax +49 281 815 184 or email [email protected] Finishing Equipment, tel +27 82 788 8265.Cosira group senior project manager Jerry Methi, tel +27 11 817 6600,cell +27 86 537 1730 or email [email protected] Structural Engineers & Contractors, tel +27 11 871 4111,fax +27 11 871 4141 or email [email protected]; or MD KobusMarais, cell +27 82 904 4657 or email [email protected] media desk, tel +27 11 800 3304/3309/3343/3378,fax +27 86 664 7699 or email [email protected]; or projectmanagers Frenchie Collet-Serret, email [email protected]; and

Abram Masango, email [email protected] national call centre, tel 0860 037 566.EsorFranki CEO Bernie Krone, tel +27 11 771 3906 oremail [email protected] Bank, Phil Coganand Maura Policelli, tel +1 202 565 3200.GB Bearings, tel +27 11 974 1291 or fax +27 11 974 1468; or sales andmarketing manager Alan Parkinson, email [email protected].

GE global communications, Kimberly Ramalho, tel +1 215 942 3409 oremail [email protected]; or public relations, Howard Masto,tel +1 518 786 6488 or email [email protected] Associates, Chris van Renssen, tel +27 12 366 0100,fax +27 12 366 0111 or email [email protected] Metals and Minerals GM Bob DArcy, tel +27 11 681 2200,fax +27 11 681 1810 or email [email protected].

Group Five, tel +27 11 806 0111.HPA, tel +27 11 260 4300, fax +27 11 656 3609 oremail [email protected]; or media liaison Pamella Radebe,tel +27 11 260 4300 or email [email protected] Keet Associates, fax +27 21 794 5643, oremail [email protected] Nuclear Services marketing manager Shane Pereira,tel +27 21 525 1300, fax +27 21 525 1333 oremail [email protected], tel +27 478 0456, fax +27 478 0371 oremail [email protected]&R group communications executive Ed Jardim, tel +27 11 456 6200,fax +27 11 455 1322 or email [email protected].

Ninham Shand Consulting Services, tel +27 21 481 2400 orfax +27 21 424 5588.Northern Flagship Institution, tel +27 12 322 7632, fax +27 12 322 5560or email [email protected] head office, tel +27 11 566 8300, fax +27 11 566 8600 oremail [email protected], tel +27 11 629 8000 or fax +27 11 626 3460.Seaton Thomson & Associates, tel +27 12 667 2107, cell +27 82 920 6115,fax +27 12 667 2109 or email [email protected], tel +27 12 349 1307 or fax +27 12 349 1229.SSD, tel +27 11 828 0439 or fax +27 11 828 2810; ordirector Theo van Schie, email [email protected] Stocks Civils contracts director Mark Stannard,

tel +27 11 571 4300.Stefanutti Stocks Geotechnical, tel +27 11 571 4300, fax +27 11 393 3150or email [email protected] Castings, tel +27 13 933 3331, fax +27 13 933 3653 oremail [email protected] Pumps South Africa, tel +27 11 820 6252 or fax +27 11 820 6205;or Gavin Doran, email [email protected], tel +27 13 752 4932, fax +27 13 752 4952 oremail [email protected] of the Free State strategic communication chief officerLeonie Bolleurs, tel +27 51 401 2707.WBHO Construction, tel +27 11 321 7200, fax +27 11 887 4364 oremail [email protected], tel +27 11 864 2800.

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ESKOMS MEDUPI POWER STATION

PROJECT

Name and LocationMedupi power station project, Lephalale, Limpopo, South Africa.

ClientEskom.

Project DescriptionMedupi, which means a rain that soaks parched lands, giving economicrelief, will be a dry-cooled coal-fired, base-load power generating plant,

comprising six 800 MW units, with a 4 800 MW installed capacity thebiggest of its kind with dry cooling in the world. It will be located on an883 ha site (formerly a farm named Naauw Ontkomen), previously usedfor game and cattle grazing.

The planned operational life of the station is 50 years.

The power station will use high-tech supercritical boilers, which willoperate at higher temperatures and pressures than older boilers, providinggreater efficiency.

It is the first base-load, coal-fired station to be built in South Africa in over20 years and its delivery on schedule is viewed as critical.

The project will form part of the utilitys integrated strategic electricityplan.

ValueR91.2-billion. As at March 31, 2012, Eskom had spent R55.2-billion.

DurationThe plant will be ramped up to full capacity by 2017.

Latest Developments?Eskom CFO Paul OFlahertyhas confirmed that Medupi power plant is ontrack to deliver first power to the grid before the end of 2013.

Speaking at the utilitys 2011/12 results presentation in June, he stated thatEskom was taking strict measures to ensure that the construction phasestayed within budget.

The hydrostatic pressure test of the first boiler at Medupi was alsocompleted earlier in the month, with President Jacob Zumainitiating thefinal phase of the test on June 8.

The boiler is at the heart of the power plant and the hydrostatic pressure tesis an essential step in the commissioning of each unit, once construction othe boiler has been completed.

Meanwhile, construction group Murray & Roberts (M&R) has reportedthat the risks associated with its Eskom-related projects have beendealt with after reaching an in-principle agreement with the Stateowned power utility relating to variation orders, time extensions andthe remaining scope of the civil engineering works at the Medupi powestation project site.

The agreement deals with all historical claims and, more importantlydefines the scope and value of the remaining works, now estimated ataround R3-billion. The full value of the contract is estimated at aroundR8-billion for the M&R-led civils joint venture, which also includes Aveng

The high-level settlement still has to be signed off by the Eskom boardbut M&R does not foresee any problems related to the clearing of thagovernance hurdle.

The solution, together with a deal concluded with Hitachi in the first halof 2011, means that M&R no longer perceives the Medupi-related orderto represent problem contracts.

The JSE-listed contractor is also the mechanical works subcontractor fothe multibillion-rand boiler contract, awarded to Hitachi in 2007. Thcontract value to M&R was estimated at about R18-billion, with abouR5-billion already spent.

Since M&R and Hitachi came to an agreement on a way forward progreson the Medupi site has improved materially. Further, the progress achievedwith Hitachi and Eskom is enabling the contractors to regain some of thtime lost during the earlier phases.

In June, Konecranes was contracted by Eskom to provide heavy-dutycranes for its Medupi, Kusile and Ingula sites.

Konecranes installed four cranes at Medupis turbine halls.

Key Contracts and SuppliersParsons Brinckenhoff (contracts manager); Exxaro Resources (coaagreement), Roshcon (civil engineering); BKS Group (audit and designof concrete steel structures); Murray & Roberts, or M&R (structurasteel fabrication and erection, mechanical installation works, boile

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construction and civil works contract); Energy Fabrication (supply of30 000 t of fabrication platework for the boiler ducting and coalbunkers); HPA and Hitachi Power Europe, or HPE (engineering, supply,manufacturing, construction and commissioning of utility steamgenerators, as well as related components such as regenerative steamairheaters, coal mills and feeders, sootblowers, fans, de-ashers, high-

pressure and low pressure pipework); Actom Protection & Control,or P&C, (turbine generator protection equipment); SPX Corporation(pulse-jet fabric filters and air preheaters, and the manufacture of pressureparts); GEA (design, manufacture, supply and erection of the air-cooledcondensers); Hansen Transmissions South Africa (condenser gearboxes);Afrimat, in partnership with local suppliers Chobe Crushers (supplyof aggregate); BroKrew Industrial (fabrication, corrosion protectionand delivery of ducting for six air-cooled condenser sections); GenrecEngineering (awarded several projects by M&R, which is contracted toHPA (connection design, to detail, fabricate and supply structural steelfor the boiler island, auxiliary bay structures, ash transverse conveyors,coal incline conveyors, and the primary and secondary coal conveyors);SSI (engineering services); Cosira (turbine hall); Kwikspace (modularaccommodation units); Sarens (mobile crane hire); Voith Turbo(Vorecon drives); Concrete Finishing Equipment (dust filters and siloand environmental safety); Arevas transmission and distribution (T&D)division (switchgear cubicles); Mikropul (axial-flow fans and auxiliaryequipment for the turbine halls ventilation); General Electric, or GE(switchgear system); Siemens (unit transformers); Clyde BergemannPower Group, subcontracted by HPA (supplier of sootblowers for boilers);Clyde Bergemann Africa (fly ash handling and conditioning systems); DSEStructural Engineers & Contractors, subcontracted by Genrec Engineering(air preheater structure); Steel Services Direct, or SSD (steel, pipes andwax plants); GB Bearings (supplier of HSR horizontal bearing assembliesand profile bore bearings); Sulzer Pumps South Africa, subcontracted byActom (fabrication of 48 pumps for boiler feed, booster and condensateextraction duties); Steloy Castings, subcontracted by Sulzer Pumps SouthAfrica (supply of chrome steel components for the pumps); ThyssenKruppMaterials Handling, or TKMH (supply of coal handling equipment);

a.b.e. Construction Chemicals (supply of waterproofing, flooring andsealant products, and other general construction products); LP Servicesconsortium (engineering, procurement and construction contract for thelow-pressure services); Lighting Structures (design, manufacture, supplyand installation of Hi Masts); and Konecranes (heavy-duty cranes).

On Budget and on Time?Eskom is still forecasting output from the first unit at the R91-billion,six-unit project towards the end of 2013.

Contact Details for Project Informationa.b.e. Construction Chemicals, Elrene Smuts, tel +27 11 306 9000.

Actom, Mark Dixon, tel +27 11 820 5111, fax +27 11 820 5100 oremail [email protected].

Afrimat investor and corporate relations, tel +27 11 325 5944 or

fax +27 11 325 5942.Areva T&D, Mark Dixon, tel +27 11 820 5037 or fax +27 11 820 504; orJames Mulholland, tel +33 1 34 96 31 82 oremail [email protected].

BKS Group, tel +27 12 421 3500, fax +27 12 421 3501 oremail [email protected].

BroKrew, tel +27 11 668 6300 or fax +27 11 955 1958.

Chobe Crushers, tel +27 14 763 5130.

Clyde Bergemann Africa, tel +2 7 11 704 0580, fax +27 11 704 0597 oremail [email protected].

Clyde Bergemann Power Group, tel +49 281 815 101, fax +49 281 815 184or email [email protected].

Cosira group senior project managerJerry Methi, tel +27 11 817 6600,

cell +27 86 537 1730 or email [email protected] Structural Engineers & Contractors, tel +27 11 871 4111,fax +27 11 871 4141 or email [email protected]; or MD KobusMarais, cell +27 82 904 4657 or email [email protected] Fabrication, tel +27 11 456 1000, fax +27 86 637 1756 oremail [email protected] Enterprise Medupi project senior communications adviser

Mashudu Ramulifho, tel +27 14 762 2148, fax +27 86 607 6080,cell +27 82 901 7184 or email [email protected] media desk, tel +27 800 3304/3309/3343/3378,fax +27 11 800 3805 or email [email protected] national call centre, tel 0860 037 566.Exxaro Resources investor relations Adriaan de Beer, tel +27 12 307 4189or email [email protected] Bearings, tel +27 11 974 1291 or fax +27 11 974 1468; or sales andmarketing manager Alan Parkinson, email [email protected] Aircooled Systems engineering and contract manager Albert Zapke,tel +27 11 861 1521 or email [email protected] corporate investor communications, Elizabeth Seibert,tel +1 203 373 2460 or email [email protected]; or corporateinvestor communications director JoAnna Morris, tel +1 203 373 2472 oremail [email protected] Engineering, tel +27 11 876 2300, fax +27 11 827 1733 oremail [email protected] Transmissions project manager Ludwig Maier,tel +27 11 571 9611, cell +27 82 213 2218 oremail [email protected], tel +27 11 260 4300, fax +27 11 656 3609 oremail [email protected]; or media liaison Pamella Radebe,tel +27 11 260 4300 or email [email protected], tel +49 203 80 38 0 or fax +49 203 80 38 1809.Kwikspace, tel +27 11 903 8993 or email [email protected], tel +27 11 466 0699, fax +27 11 466 8180 or email [email protected] Nuclear Services marketing manager Shane Pereira,

tel +27 21 525 1300, fax +27 21 525 1333 oremail [email protected], tel +27 478 0456, fax +27 478 0371 or email [email protected]&R, tel +27 11 723 2080; or group communications executive EdJardim, tel +27 11 456 6200, fax +27 11 455 1322, cell +27 83 357 6282 oremail [email protected] Brinckenhoff, tel +27 11 787 4141, fax +27 11 886 0359 oremail [email protected], tel +27 11 629 8000 or fax +27 11 626 3460.Sarens, tel +27 11 861 3800, fax +27 11 861 3899 or email [email protected].

SSD, tel +27 11 828 0439 or fax +27 11 828 2810; or director Theo vanSchie, email [email protected] CEO Naren Bhojaram, tel +27 11 798 6000, fax +27 11 798 6005 oremail [email protected] Castings, tel +27 13 933 3331, fax +27 13 933 3653 oremail [email protected] Pumps South Africa, tel +27 11 820 6252 or fax +27 11 820 6205;or Gavin Doran, email [email protected], tel +27 11 236 1000 or fax +27 11 236 1235; or marketingmanager Willie Agenbag, email [email protected] Turbo operations manager Izak van der Walt, tel +27 11 418 4076,fax +27 11 418 4059 or email [email protected] Contracts, tel +27 11 392 8000, fax +27 11 392 5856 oremail [email protected] Structures, Pieter Jooste, tel +27 87 310 1000,fax +27 86 699 6999 or email [email protected], tel +27 11 864 2800.

Electricity

From page 7



11/53

ESKOMS RETURN-TO-SERVICE

PROJECTS

Name and LocationEskoms return-to-service (RTS) projects, South Africa.

ClientEskom.

Project DescriptionThe projects involve the demothballing of three coal-fired stations Camden, Grootvlei and Komati, for a combined nominal capacity of3 800 MW.

The Camden power station, in Ermelo, in Mpumalanga, is the first ofEskoms three mothballed coal-fired power stations to be returned toservice. The station will add 1 520 MW to the Eskom grid. At Camden,there are eight 200-MW units, with a combined capacity of 1 600 MW.Two generating units, with a combined capacity of 400 MW, was broughton-stream at Camden every year from 2005 to 2008.

The Grootvlei power station, near Balfour, in Mpumalanga, has six boilerand turbine sets and a total capacity of 1 200 MW.

The Komati power station, situated between Middelburg and Bethal, in

Mpumalanga, has an installed capacity of five 100 MW units and four125 MW units.

The three stations will each have an operating life of between 15 and20 years.

ValueR25-billion. As at March 31, 2012, R23-billion had been spent.

DurationThe Camden power station was reintroduced to the grid at the end of July2008 and officially launched by President Jacob Zuma in October 2010.The Grootvlei and Komati projects will be completed in 2012.

Latest developmentsEskom reported in June that three of the Komati power station units and

Unit 5 of the Grootvlei power station had been commissioned.Further, capacity at Camden power stations Unit 6 increased.

Only three units remain to be commissioned at Komati to complete thereturn-to-service power station project.

Key Contracts and Suppliers

Companies involved at the Camden power station:Steinmller Engineering Services (boiler plant refurbishment), SouthAfrican Compensators, or SAC (manufacture of economisers), ABB(common plant switchgear and the switchgear protection), SiemensBuilding Technologies (control and instrumentation equipment, andinstallation of fire-detection system), AquaPlan (water plant and sewageplant operation), Howden Africa Holdings (the return-to-service) andupgrade of the Unit 6 precipitators), Stefanutti & Bressan (station control

room, battery room and equipment room; refurbishment and upgrading

of compressors and compressed-air system), Loesche (Unit 6 milling planrefurbishment five mills).

Companies involved at the Grootvlei power station:Fluor, in a joint venture with Pangaea (engineering, procurement andconstruction management services), Honeywell (distribution controsystem), VWS Envig (refurbishment of potable and demineralisation watetreatment plants), Pangaea (engineering, procurement and construction

management services), Honeywell (distribution control system), VWSEnvig (refurbishment of potable and demineralisation water treatmenplants), Actom South Africa (previously Alstom) (modernisationrefurbishment and replacement of the turbine control and protectionsystem for all six generator units and four steam-feed pump turbines aGrootvlei power station, as well as the retrofitting, refurbishment andupgrade of the gas-cleaning systems for all six generation units at thpower station), and Mapelastic Smart (waterproofing).

On Budget and on Time?Returning the power stations to service was expected to be completed byOctober 2011, but is now expected to be completed by October 2012.

Contact Details for Project InformationABB head office, tel +27 10 202 5000, +27 86 022 2123, or email

[email protected] South Africa head office, Mark Dixon, tel +27 11 820 5111 orfax +27 11 820 5100.

AquaPlan, tel +27 11 979 2510, fax +27 11 979 2587 oremail [email protected].

Camden power station manager Anthony Kuzelj, tel +27 17 827 8006 orfax +27 17 827 8208.

Eskom media desk, tel +27 800 3304, fax +27 11 800 3850 oremail [email protected]. Eskom national call centre,tel 0860 037 566.

Fluor, tel +27 11 233 3400 or fax +27 11 233 3805.

Grootvlei power station manager Jason Hector, tel +27 17 779 8641 orfax +27 17 779 0021.

Honeywell, tel +1 973 455 2000 or fax +1 973 455 4807.Howden Africa Holdings projects Andrew Twyford, tel +27 11 240 4240,fax +27 11 493 1749 or email [email protected].

Komati power station site manager Christopher Nani, tel +27 13 2959119 or fax +27 13 295 9101.

Loesche, tel +27 11 482 2933, fax +27 11 482 2940 oremail [email protected].

SAC, tel +27 16 341 4101/2/3 or fax +27 16 341 2618.

Siemens Building Technologies, tel +49 69 797 6660.

Stefanutti Stockss Holdings, tel +27 11 571 4300, fax +27 11 571 4370 oremail [email protected].

Steinmller Engineering Services, tel +27 11 806 3000,fax +27 11 806 3330 or email [email protected].

VWS Envig, email [email protected].

Electricity



12/53

In 2011 the South African government proceeded with a renewable energyindependent power producer programme (REIPPP), to add 3 725 MW ofindependently produced renewable power to the national grid by 2016. Thisplan, in conjunction with the action that has been taken to move it forward, hasdone much to boost condence in governments commitment to independent andlarge-scale renewable power.

In the rst window of the REIPPP bid window, 53 qualied bids had beenreceived, of which 28 were selected as preferred bidders, representing about1 415 MW of potential capacity. The preferred bidders named include 18 solarphotovoltaic (PV) projects, eight onshore wind projects and two concentratingsolar power (CSP) projects.

For the second window, 79 bids were submitted, of which 51 met therequirements

of the REIPPP request for proposals. However, owing partly to the fact that only1 275 MW was available, only 19 projects, representing 1 043.9 MW of capacity,were selected. The preferred bidders include nine solar PV projects, sevenonshore wind projects, two small hydropower projects and one CSP project.

The 47 preferred bids, representing about 2 459.4 MW of renewables capacity,are expected to make a collective invest of some R70-billion to develop theirprojects.

The schedule and capacity allocation for the third bid window under the REIPPP isexpected to be announced in due course.

Renewable Energy



13/53

DEPARTMENT OF RENEWABLE ENERGY

INDEPENDENT POWER PRODUCER

PROGRAMME FIRST WINDOW

Name and LocationRenewable Energy Independent Power Producer Programme (REIPPP) first window, South Africa.

ClientDepartment of Energy (DoE).

Project DescriptionThe REIPPP projects are among an initial batch of 53 bids submittedfor the November 2011 bid window and represent potential capacity of1 415.2 MW and potential investment of billions of rands.

The preferred bidders named include 18 solar photovoltaic (PV) projects,eight onshore wind projects and two concentrating solar power (CSP)projects.

The PV projects named are: SlimSun Swartland solar park (5 MW).

Rustmo1 solar farm (6.76 MW).

Mulilo Renewable Energy Solar PV De Aar (9.65 MW). Konkoosies Solar (9.65 MW).

Aries Solar (9.65 MW).

Greefspan power plant (10 MW).

Herbert PV power plant (19.9 MW).

Mulilo Renewable Energy Solar PV Prieska (19.93 MW).

Soutpan solar park (28 MW).

Witkop solar park (30 MW).

Touwsrivier project (36 MW).

De Aar solar PV (48.25 MW).

South African Mainstream Renewable Power Droogfontein Project(48.25 MW).

Letsatsi Power Company (64 MW).

Lesedi Power Company (64 MW). Kalkbult project (72.5 MW).

Kathu solar energy facility (75 MW).

Solar Capital De Aar (75 MW).

The combined capacity of the solar PV projects that made it through tothe preferred-bidder stage was 631.53 MW.

The wind projects listed include: Dassiesklip wind energy facility (26.19 MW).

MetroWind Van Stadens wind farm (26.19 MW).

Hopeeld wind farm (65.40 MW).

Noblesfonstein (72.75 MW).

Red Cap Kouga wind farm Oyster Bay (77.6 MW).

Dorper wind farm (97 MW).

Jeffreys Bay project (133.86 MW).

Cookhouse wind farm (135 MW).

The wind project collectively represents 633.99 MW of capacity.The two solar CSP projects named were Khi Solar One (50 MW) and KaXuSolar One (100 MW). The DoE aims to produce 1 850 MW of onshorewind, 1 450 MW of solar PV, 200 MW of CSP, 75 MW of small hydro25 MW of landfill gas and 12.5 MW each of biomass and biogas capacity.

ValueThe projects represent a collective investment of about R46-billion.

DurationThe first 28 REIPPP preferred bidders had until June 2012 to take theirprojects to financial closure. However, the 28 preferred bidders identifiedin December were notified later that the timing of financial closure wouldbe delayed until after the end of July.

All projects will need to generate power by mid-2014, apart from theCSP plants, which have been given a deadline of 2016.

Latest DevelopmentsThe DoE announced on August 16 that it expected to begin concludingoutstanding financial-closure agreements with the first 28 wind andsolar bidders, named in December as preferred bidders under theRenewable Energy Independent Power Producer Programme (REIPPPthe following week, and that it aimed to complete the process by the endof the month.

However, director-general Nelisiwe Magubane indicated that the DoEwould be sending requests to bidders for an extension of the bidding periodbeyond the August 31, 2012, bid validation period effectively cautioninthat the financial-close period could well extend beyond that date.

Key Contracts and SuppliersNone stated.

On Budget and on Time?Too early to state.

Contact Details for Project InformationDoE departmental spokesperson Thandiwe Maimane,tel +27 12 444 4256, cell +27 82 450 8591, fax +27 86 581 8505 oremail [email protected].

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DEPARTMENT OF RENEWABLE ENERGY

INDEPENDENT POWER PRODUCER

PROGRAMME SECOND WINDOW

Name and LocationRenewable Energy Independent Power Producer Programme (REIPPP) second window, South Africa.

ClientDepartment of Energy (DoE).

Project DescriptionThe DoE has announced 19 companies as preferred bidders during thesecond window of the REIPPP, which closed on March 5. The 19 projectsrepresent 1 043.9 MW of capacity.

The preferred bidders named include nine solar photovoltaic (PV)projects, seven onshore wind projects, two small hydropower projects andone concentrated solar power (CSP) project.

The solar PV projects named are: Solar Capital De Aar 3 (75 MW)

Sishen solar facility (74 MW)

Aurora (9 MW) Vredendal (8.8 MW)

Linde (36.8 MW)

Dreunberg (69.6 MW)

Jasper Power Company (75 MW)

Boshoo solar park (60 MW)

Upington solar PV (8.9 MW)

The combined capacity of the solar PV projects that made it through to thepreferred-bidder stage was 417.1 MW.

The wind projects listed include:

Gouda wind facility (135.2 MW)

Amakhala Emoyeni (Phase 1), Eastern Cape (137.9 MW)

Tsitsikamma community wind farm (94.8 MW) West Coast 1 (90.8 MW)

Waainek (23.4 MW)

Grassridge (59.8 MW)

Chaba (20.6 MW)

The wind projects collectively represent 562.5 MW of capacity.

The preferred small hydropower bidders include Stortemelk Hydro(4.3 MW) and Neusberg hydroelectric project A (10 MW) for a cumulative14.3 MW.

The one CSP project named was the 50 MW Bokpoort CSP project.

ValueThe second-round projects are valued collectively at close to R28-billion.

DurationThe preferred bidders identified during the second bid window have untilDecember 13 to take their projects to financial closure.

Latest DevelopmentsA total of 51 of the second-window bidders met the requirements ofthe REIPPP request for proposals. But, owing partly to the fact that only1 275 MW was available, only 19 projects, representing 1 043.9 MW ofcapacity, were selected, Energy Minister Dipuo Petersreported.

Bidders present at the announcement expressed some disappointmentwith the fact that the full window-two allocation had not been taken up.

But government explained that the next best bids would have resulted inmore than 1 275 MW being allocated and that it had, thus, decided to holdoff until the third bid window.

It is possible that bids will be sought for the remaining 1 165.9 MW not yeallocated for large projects during window three. The next window couldalso include capacity that might become available should any round-onepreferred projects fail to reach financial closure.

In the next few weeks, the DoE will release a tender for projects involvinless than 5 MW. An allocation of 100 MW had been set aside from the3 725 MW currently being procured by government.

Meanwhile, some of the developers and equipment suppliers involved inthe 19 projects confirmed as preferred bidders under the REIPPP havestarted to emerge.

Companies such as Acciona Energy, Aveng, Cennergi, EDF EnergieNouvelles, GDF Suez and Windlab Developments South Africa havconfirmed that their projects have been selected.

Cennergi, the recently formed joint venture involving Exxaro and TataPower, has confirmed that two of its wind projects have advanced topreferred-bidder status.

The companys 137.9 MW Amakhala Emoyeni wind farm project, locatenear the town of Bedford, in the Eastern Cape, is the largest wind projecnamed in the round. The project is being developed together with WindlabDevelopments South Africa. Indias Suzlon Energy will supply 66 turbinefor the Amakhala Emoyeni project, which will be delivered under a fulengineering, procurement and construction management agreement.

Cennergis other wind project to advance is the 94.8 MW Tsitsikammacommunity wind farm. Danish wind turbine producer Vestas will supplyturbines to the wind farm.

Vestas has also confirmed that it has been selected the preferred supplierfor five projects, with a combined nameplate capacity of 297 MW. Besidethe Tsitsikamma community wind farm, the Danish group is set to supplythe 90.8 MW West Coast 1 project being pursued by Moyeng Energy, a

consortium involving Investec Bank and French energy company GDFSuez and supported by Windlab.

Vestas systems could also be deployed at the 59.8 MW Grassridge, the23.4 MW Waainek and the 20.6 MW Chaba projects, being developed byEDF Energies Nouvelles.

Also, renewable-energy company Acciona Energy and construction groupAveng have confirmed that they have secured preferred-bidders status onthe 135.2 MW Gouda wind facility, as well as the 74 MW Sishen PV facility

The Department of Energy has revised the financial-close schedule of the19 second-round preferred bidders to between March 18 and 28, 2013from an initial date of December 2012

Key Contracts and SuppliersSuzlon Energy (wind turbines) and Vestas (wind turbines).

On Budget and on Time?Too early to state.

Contact Details for Project InformationDoE departmental spokespersonThandiwe Maimane,tel +27 12 444 4256, cell +27 82 450 8591, fax +27 86 581 8505 oremail [email protected].

Suzlon Energy investor relations, Dhaval Vakil, tel +91 22 6639 3252 oremail [email protected].

Vestas, tel +45 97 30 00 00.

Renewable Energy



15/53

At the beginning of this year, South Africas Finance Minister Pravin Gordhanlisted 43 major infrastructure projects during his Budget speech, amounting to

R3.2-trillion in expenditure. For the medium-term expenditure framework periodahead, approved and budgeted infrastructure plans amount to R845-billion, ofwhich just under R300-billion is allocated to the energy sector and R262-billion totransport and logistics projects.

Believing that it is time to add capacity in preparation for the countrys futuregrowth, Sephaku Cement has embarked on a project that entails the constructionof the Aganang cement production facility, 25 km west of Lichtenburg, in theNorth West; a cement grinding facility, in Delmas, in Mpumalanga; and a 3 000t/d clinker and cement production facility, near Dwaalboom, in Limpopo.

Industrial Projects



16/53

SEPHAKU CEMENT PROJECTS

Name and LocationSephaku Cement projects, South Africa.

ClientSephaku Cement, a subsidiary of Nigeria-listed Dangote Cement (64%)and associate of JSE-listed Sephaku Holdings (36%).

Project DescriptionThe projects entail the construction of the Aganang cement productionfacility, 25 km west of Lichtenburg, in the North West; a cement grindingfacility, in Delmas, in Mpumalanga; and a 3 000 t/d clinker and cementproduction facility, near Dwaalboom, in Limpopo.

It is estimated that the Aganang and Delmas cement plants will deliverabout 2.5-million tons a year of cement.

The Aganang operations will include limestone mining and chemicalprocessing of raw materials to produce clinker. The limestone deposit islocated on the Stiglingspan, Verdwaal and Klein Westerford farms, 7 kmsouth-west of Itsoseng. Half of the clinker will be ground, milled andblended to produce cement. The rest of the clinker will be transported tothe Delmas plant, for further processing, using fly ash produced at the fly

ash classification plant at Kendal power station as an extender to producethe final cement.

The limestone quarry and the cement project have an expected life ofbetween 30 and 48 years, depending on the availability of the delineatedmineral resources and the guaranteed kiln production figures.

ValueConstruction of the Aganang and Delmas plants will cost R3.3-billion. Thebalance of the finance will be funded by debt guaranteed by Dangote, amajority shareholder in the projects.

The value of the clinker and cement production facility, in Limpopo, hasnot been disclosed.

DurationSephaku started construction on the Aganang cement production facility

late in 2011, with first production scheduled for November 2013, after thecommissioning of the plants clinker in October 2013.

Construction of the Limpopo plant is planned to start in 2014 and isexpected to come into production in 2016.

Latest DevelopmentsEight-hundred employees of Chinese company Sinoma InternationalEngineering are currently working on site to construct cement producerSephaku Cements new Aganang cement production facility.

Sephaku did initially go out to tender for South African contractors,but realised that no South African contractor would be willing to take aturnkey risk on such a plant, Sephaku Cement CEO Pieter Fourie told

Mining Weekly.

Fourie says that the fixed prices the company received from Sinoma saved

it 25% on total development. However, skills transfer and the use of locallabour are provided for in the contract with Sinoma. One South Africanlabourer is used for every three Chinese workers.

Fourie reiterates that the Chinese workers will only be employed duringthe construction of the plant; therefore, permanent jobs for South Africanswill be created during the entire life of the plant, which is expected to bebetween 30 and 40 years.

Meanwhile, the construction of an Eskom substation was completed inMarch. A new 49 km, 132 kV incoming powerline has also been erectedfrom Watershed, near Lichtenburg, to the plant, says Aganang civilengineer Jacques Minnie.

Construction of a 4.2 km asphalt-surfaced access road from the existingKapsteel road to the plant location is also under way. The road will consist

of two 3.7-m-wide lanes, with two additional 0.8 m paved shoulders. It iexpected to be completed in November.

Key Contracts and SuppliersNedbank Capital (lead financial arranger), Sinoma InternationaEngineering (construction), Eskom (power-supply agreement for the plan

in the North West) and Africa Geo-Environmental Services (environmentaconsultant for Limpopo plant).

On Budget and on Time?Despite a three-month delay in the original timeline, the projects remainon track and within budget.

Contact Details for Project InformationDangote Cement, Anthony Chijiena, cell +234 807 049 0149.

Sephaku Cement, tel +27 1861 555 2020 or fax +27 12 665 4391/+27 12 684 6402; or CEO Pieter Fourie, tel +27 12 686 4800 oremail [email protected]; or Nokuthula Nxumalo,tel +27 12 686 4837 or cell +27 82 954 6644.

Sinoma International Engineering, tel +86 10 6439 9518,fax +86 10 6439 9510 or email [email protected].

Industrial Projects



17/53

South Africa has a highly developed synthetic fuels (synfuels) industry, inwhich State-owned PetroSA is one of the major players.

PetroSA, which produces synfuels from natural gas at its 45 000 bl/dfacility in Mossel Bay the largest natural GTL plant in the world isstrongly advocating the development of a new $10-billion, 360 000 bl/drenery at Coega, in the Eastern Cape, to secure South Africas liquid fuelsrequirements. This is despite South Africas existing reners, comprisingmany of the worlds majors, opposing the construction of the new renery

and arguing that the country may be better served by investing in theexisting rening base.

On another front, chemicals, explosives and fertiliser group Omnias newnitric acid complex, in Sasolburg, has been successfully registered as a CleanDevelopment Mechanism (CDM) project by the United Nations FrameworkConvention on Climate Change. The new green nitric acid complex, whichstarted operating towards the end of March this year, will produce 1 000t/d has been designed to generate between 250 000 and 350 000 carboncredits a year. This will total 650 000 t/y to 730 000 t/y of certied emissionreductions for the new and the existing plant.

Petrochemicals

and Chemicals

Source:Omnia



18/53

OMNIA HOLDINGS NITRIC ACID

COMPLEX

Name and LocationNitric acid complex, Free State, South Africa.

Client

Omnia Holdings.

Project DescriptionThe complex comprises a nitric acid plant, an ammonium nitrate plant, aporous ammonium nitrate plant, a fleet of 145 specialised ammonia railtankers and other ancillary facilities.

The nitric acid plant will produce 1 000 t/d, which is 40% more than thecurrent plant.

Value

R1.4-billion was budgeted for the project.

Duration

The project was announced in 2010 and started operating towards the endof March 2012. Ramp-up to full capacity will take place in line with growthin the explosives and fertiliser markets.

Latest Developments

Omnias nitric acid plant, which was launched at the end of March, hasbeen successfully registered as a Clean Development Mechanism project bythe United Nations Framework Convention on Climate Change.

Omnia successfully completed the registration of its second project in tenmonths and is one of three companies in the world to obtain approvaunder the new method. The new nitric acid complex should generatebetween 250 000 to 350 000 carbon credits a year.

This new facility will enable the company to prevent greenhouse gaemissions of about 500 000 t of carbon dioxide equivalent a year.

Key Contracts and SuppliersThyssenKrupp Uhde (EnviNOx system) and BME (construction).

On Budget and on Time?The plant was completed on time and below budget.

Contact Details for Project InformationOmnia Holdings, tel +27 11 709 8850.Brunswick on behalf of Omnia, Taryn Wulfsohn, tel +27 11 502 7400.ThyssenKrupp Uhde head of corporate communications DetlefMarkmann, tel +49 231 547 3813, fax + 49 231 547 2628 oremail [email protected].




19/53

PETROSAS PROJECT MTHOMBO

Name and LocationProject Mthombo, Coega industrial development zone (IDZ), EasternCape, South Africa.

ClientPetroSA.

Project DescriptionSouth Africas State-owned oil company PetroSA plans to build a 360 000bl/d crude oil refinery, about 10 km from the Port of Ngqura, at Coega,near Port Elizabeth, in the Eastern Cape, to meet the growing demand forfuel in the country.

The facility is designed to refine crude oil from the Atlantic Ocean, knownas heavy sour, as opposed to the light sweet crude oil from the MiddleEast, which South Africas existing refineries are designed to turn intopetroleum products.

Once completed, the refinery will be the biggest in Africa and will reduceSouth Africas reliance on oil imports, by supplementing the countrysgrowing diesel and petrol shortfall, with cleaner fuels.

An electricity power plant is also planned as part of the project. It isenvisaged that the power station will generate about 800 MW of electricity,of which 200 MW will be used for the refinery. The excess power will be fedback into the national grid.

ValueThe project cost is estimated at $11-billion.

DurationCommissioning is scheduled for 2018/20.

Latest DevelopmentsIn May 2012, PetroSA and China Petroleum Corporation (Sinopec) sealeda joint study agreement (JSA) for Project Mthombo.

The agreement, which will shape the business case for the crude oil refinery,follows the signing of a memorandum of understanding between PetroSA

and the Chinese State-owned company in 2011.The agreement will see the commissioning of studies over two phasesduring the next 18 months.

Sinopec Engineering Incorporation has been contracted to undertake thestudies.

PetroSA and Sinopec have also established a steering committee to guidand manage the process, while a working group will be created to workclosely with Sinopec Engineering.

Phase 1 includes market studies and the review and selection of a businescase, while Phase 2 will result in the development of a business case that iexpected to prepare Project Mthombo for the front-end engineering anddesign (Feed) stage.

The JSA will further align the partners and develop an integrated ownerteam in line with best practices for the planning and execution of theproject.

The results of the study could also be key in the development ogovernments 20-year liquid fuels plan and the work of the PresidentiaInfrastructure Coordinating Commission.

Key Contracts and SuppliersKBC Advanced Technologies (project technical/commercial adviser)HSBC (project finance advisory service provider); KBR (feasibility andFeed study services); Edward Nathan Sonnenbergs (ENS) consortium(legal advisers); the Council for Scientific and Industrial Research, orCSIR, (environmental-impact assessment); Fairbrother GeotechnicaEngineering (geotechnical investigation) and Sinopec Engineering (review

selection and development of business case).On Budget and on Time?Too early to state.

Contact Details for Project InformationCSIR, tel +27 12 841 2911, fax +27 12 349 1153 oremail [email protected], tel +27 21 410 2500, fax +27 21 410 2555 or email [email protected] Geotechnical Engineering, tel +27 21 715 5470 orfax +27 21 715 6369.HSBC, tel +27 21 405 6500 or fax +27 21 424 8745.KBR investor relations director Rob Kukla, tel +1 713 753 5082,fax +1 713 753 5353 or email [email protected] Mthombo, tel +27 21 929 3600, fax +27 21 929 3321 or

email [email protected] spokesperson Thabo Mabaso, tel +27 21 929 3000,fax +27 21 929 9294 or email [email protected]; ormidstream new ventures VP Joern Falbe, tel +27 21 929 3600.Sinopec, tel +86 10 6916 6396, fax +86 10 6916 6645 oremail [email protected].




20/53

A strong emphasis was placed on South Africas multibillion-rand publicinfrastructure programme at the beginning of this year, including those projectsthat will unlock key mineral resources and exports.

One of the key projects discussed was the improvement of the transportation ofgoods through the DurbanFree StateGauteng logistics and industrial corridorthrough the prioritisation of rail and port improvements, which will be supportedsignicantly by State-owned transport and logistics group Transnets R300-

billion, seven-year Market Demand Strategy that will continue until 2018/19. TheDurban port upgrade and expansion project, in South Africas KwaZulu-Natalprovince is signicant, as it aims to increase the capacity of the Durban containerterminal from 700 000 twenty-foot equivalent units (TEUs) to 820 000 TEUs by2013 and eventually to 1.2-million TEUs by 2016/17.

Another project, which is being implemented by State-owned company theSouth African National Roads Agency Limited, is the much-debated GautengFreeway Improvement Project, which comprises different phases to upgrade andimplement new toll freeways of 561 km freeway network.




21/53

SANRALS GAUTENG FREEWAY

IMPROVEMENT PROJECT

Name and LocationGauteng Freeway Improvement Project (GFIP), South Africa.

ClientThe project is managed by State-owned company South African National

Roads Agency Limited (Sanral).

Project DescriptionThe GFIP is a long-term freeway upgrade and expansion project, whichentails the upgrade and construction of about 561 km of freeways.

ValueThe Department of Transport, through Sanral, has invested more thanR21-billion in the first phase of the project.

DurationDespite being delayed by a shortage of bitumen and adverse weather in2011, Phase 1 of the project was substantially completed by the end of2011.

Latest Developments

The National Treasury and Sanral have acted to have the temporaryinterdict, restraining the tolling of some of Gautengs freeways, set aside inthe Constitutional Court until the full review of the system in November.

A Constitutional Court decision will follow.

Key Contracts and SuppliersBasil Read Interchange [I/C] (improvements at the N1 section); Siyavaya

joint venture (JV), comprising Group 5, Power Construction, Liviero,Umso Construction and Bophelong Construction (work package A and E);GFI Contractors JV, comprising Wilson Bayly Holmes-Ovcon (WBHO),Sanyati Construction, Rainbow Construction, Glash Construction, MunasiCivil Contractors and EsorFranki Civils, formerly Patula Construction(work package B); GLMB JV, comprising Grinaker-LTA, a member ofthe Aveng group, Moseme Road Construction and Boitshoko RoadSurfacing (work package C and F); Basil Read JV, comprising Roadcrete,

Chavani Construction and Dipcivil or BRCD (work package D); CMC JV,comprising CMC di Ravenna South Africa and G4 Civils (work packageG); Raubex Construction (upgrade of the R21); Power Group (upgradeof the R21 section 1 and 2); Tosas (subcontractor bituminous binders);ETC JV (multilane free-flow tolling system); Jet Demolition (demolition ofAllandale I/C bridge); ARQ Consulting Engineers (design of the LynnwoodGlen pedestrian and pipe bridge); Cadcon, subcontractor of BRCD JV(manufacture of the Lynnwood Glen pedestrian and pipe bridge); Beka(luminaires); Esorfranki Civils (work package J); Goba SSI JV (Gilloolysflyover); Much Asphalt, a Murray & Roberts company (asphalt supplier);and ETC JV, comprising Traffic Management Technologies and KapschTrafficCom (design and operate the open-road tolling system).

On Budget and on Time?E-tolling was suspended on April 28, 2012, pending a full review.

Contact Details for Project InformationSanral northern region manager of toll and traffic, and project managerAlex van Niekerk, tel +27 11 426 6200; or corporate communicationsmanager Priya Pillay, tel +27 12 844 8000, fax +27 12 844 8200 oremail [email protected]; or project manager: communicationsWanda Cloete, tel +27 12 844 8000, fax +27 12 844 8200 oremail [email protected].




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TRANSNETS DURBAN PORT UPGRADE

Name and LocationDurban port upgrade and expansion project, KwaZulu-Natal, South Africa.

ClientThe Transnet National Ports Authority (TNPA) and Transnet PortTerminals (TPT), divisions of freight logistics company Transnet.

Project DescriptionThe Durban container terminal (DCT) is the biggest and the busiest in thesouthern hemisphere and currently handles 64% of the countrys seabornecontainer traffic.

Transnet is implementing an ambitious expansion project at Durban portand its container terminals, comprising several individual work packages,aimed at increasing the DCTs container-handling capacity.

The main projects include the expansion of the DCT Pier 1, which willincrease the capacity of the terminal from 700 000 20-foot equivalent units(TEUs) to 820 000 TEUs by 2013 and eventually to 1.2-million TEUs by2016/17.

In addition, the North quay at DCT Pier 2 will be extended to increase thecapacity from 2.1-million TEU in 2011/12 to 2.5-million TEU by 2013/14

and to 3.3-million TEU by 2017/18.Container capacity is also being created in other terminals, such as theDurban Ro-Ro and Maydon Wharf terminal, through the acquisitionof new equipment, including mobile cranes and various infrastructureupgrades.

Transnet is further proposing the development, in phases, of a new dig-outport on the old Durban International Airport (DIA) site.

ValueThe project forms part of an initial five-year R110.5-billion capitalexpenditure programme to 2015/16, as well as the groups largerR300-billion, seven-year Market Demand Strategy to 2018/19.

However, funding for the new port at the DIA is not included in thestrategy. Transnet has indicated that it is in the final stages of appointing

a transaction adviser and is looking at the various funding options andmodels for private-sector participation in the project.

DurationOngoing.

Latest DevelopmentsTransnet has started with the initial environmental-impact studies for thenew R50-billion to R75-billion port, planned at the site of the old DIAsite.

Transnet will spend about R15-million on developing the project beforethe private sector will become involved. It is expected to be offered to theprivate sector on a build, operate and transfer basis.

Envisaged is the construction of five automotive berths, four bulk-liquidsberths and 16 container berths that will be constructed in four phases and

have a total capacity of ten-million TEUs. The project is expected to becompleted by 2030.

The environmental impact studies are expected to take between 18 monthsand 24 months to complete.

Key Contracts and SuppliersProtekon Consulting & Construction; CPS; IMPSA-Jikelele joint venture(JV); Kalmar African National Engineering (ANE) JV; Hydroflow andLiebherr Cranes (Germany); Grinaker-LTA, Interbeton and BafokengBateman Services (Bafokeng Civil Works and Bateman MaterialsHandling) JV; DSE and Dorbyl (subcontractors steelwork fabrication); LaSpezia container terminal, Italy (three Liebherr cranes); Kalmar (straddlecarriers); DSE (manufacture of structural components and the erection, aswell as installation of mechanical and electrical work); Protekon (planning

and designing the infrastructure for the installation of the Liebherr craneat the South Terminal); Protekon Construction (two new berths foIsland View terminal), Dura Piling (piling contract Island View) BasiRead (main contractor Pier 1, civil and paving works DCT), ChrysoSouth Africa (concrete products hard standing area, Pier 1), LafargeReadymix (design and supply of concrete hard standing area, Pier 1)Natal Portland Cement or NPC (cement Pier 1), Kalmar Industrie

(30 straddle carriers), TBA (review, analysis and simulation of DCTcontainer-handling operations), Sarens Group (crawler crane); the JapanBank for International Cooperation (loan finance); Shanghai ZhenhuaPort Machinery Company (rail-mounted gantry cranes); ShanghaZhenhua Heavy Industries Co (ZPMC)(design, manufacture, deliveryand commissioning of cranes); Dredging International and Group Five(port-widening project); C3 Shared Services (codesign of security solutionat Pier 1); Mott MacDonald in JV with Hatch and Goba (widening oDurban harbour entrance and construction of Pier 1 container terminal)Blue IQ (financial coordinator for proposed container terminal at the oldDIA site); and Liebherr (design, fabrication, delivery, erection, testing andcommissioning of the cranes).

On Budget and on Time?The project is on schedule and within budget.

Contact Details for Project InformationANE Durban head office, tel +27 31 579 3301, fax +27 31 579 3323 oremail [email protected].

Basil Read, tel +27 11 418 6375 or fax +27 11 418 6334.Bateman, tel +27 11 899 9111 or email [email protected].

Chryso South Africa, tel +27 11 395 9700 or fax +27 11 397-6644; orbranch manager Vishnu Beeput, tel +27 31 702 4379, cell +27 82 4557696 or email [email protected].

Dorbyl, tel +27 41 408 6009, fax +27 41 408 6035 oremail [email protected] International, tel +32 3 250 52 11, fax +32 3 250 56 50 oremail [email protected].

DSE MD Kobus Marais, tel +27 11 871 4111, fax +27 11 871 4141, or

email [email protected], tel +27 11 578 6000, fax +27 11 578 6161 oremail [email protected] Five, tel +27 11 806 0111, fax +27 11 803 5520 oremail [email protected].

Kalmar Industries, tel +27 31 327 1800 or fax +27 31 327 1811.Lafarge Readymix, tel +27 31 275 7400.

NPC, tel +27 31 450 4411 or fax +27 31 451 9010.Sarens Group, Hendrik Sarens, tel +32 52 319 397 oremail [email protected].

Transnet DCT, Siya Mhlakula, tel +27 31 361 6964 oremail [email protected].

Transnet Durban car terminal, Beverley Masson, tel +27 31 361 8702 oremail [email protected] spokesperson Mboniso Sigonyela, tel +27 11 308 2384/2458,fax +27 11 308 2465, cell +27 83 463 7701 oremail [email protected] Pier 1 container terminal, Michelle Philips, tel +27 31 361 6820or email [email protected].

TNPA Port of Durban port manager Ricky Bhikraj, tel +27 31 361 8821or email [email protected]; or public affairs department,tel +27 31 361 8527.

TPT Durban head office, tel +27 31 308 8333 or fax +27 31 308 8302; orchief communication officer Lunga Ngcobo, tel +27 31 308 8323,cell +27 083 288 9653 or email [email protected], Tel + 86 21 58396666, fax +86 21 58399555 oremail [email protected].




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South Africas highly uctuating and unpredictable yearly rainfall makes it awater-scarce country.

According to the 2030 Water Resources Group, established in 2008 by aconsortium of business partners to contribute new insights about the ever-critical issue of water-resource scarcity, the estimated demand for water inSouth Africa will reach 17.7-billion cubic metres in 2030. Minister of WaterAffairs Edna Molewa has warned that South Africa could face a water crisiswithin the next decade if urgent steps are not taken. Against this backdrop anamount of R75-billion has been allocated over the next three years for waterinfrastructure, quality management, resource planning and support to localgovernment to address the problem.

One project that is already under development is the Trans-Caledon TunnelAuthoritys Olifants River Water Resources Development Project Phase 2 inSouth Africas Limpopo province, which aims to provide additional waterresource infrastructure to the middle part of the Olifants water managementarea.

Nonetheless, a much bigger capital injection than is currently budgeted for isrequired to ensure adequate water supply in South Africa, with the Departmeof Water Affairs calculating that current allocations amount to only 44% ofthe R573-billion that should be invested in water infrastructure, services anddemand management over the next decade.

Water


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TRANS-CALEDON TUNNEL AUTHORITYS

OLIFANTS RIVER WATER RESOURCES

DEVELOPMENT PROJECT PHASE 2

Name and LocationOlifants River Water Resources Development Project Phase 2 (ORWRDP-2),Limpopo, South Africa.

ClientThe Department of Water Affairs, represented by the Trans-CaledonTunnel Authority (TCTA) for Phases 2B to 2G.

Project DescriptionThe ORWRDP comprises two phases and a number of subphases:

Phase 1 involved the raising of the Flag Boshielo dam by five metres, whichhas been completed.

Phase 2 (Phases A to I) involves the development of additional waterresource infrastructure in the middle part of the Olifants watermanagement area.

Phase 2A entails the construction of the De Hoop dam, which will bea bulk storage facility to augment the current water supply around the

Steelpoort and Olifants rivers in Limpopo. Water will primarily be suppliedto increasing mining activities around the Steelpoort area.

The De Hoop dam, which will be the thirteenth-largest in the country, isplanned to have a 347-million-cubic-metre reservoir capacity.

This phase also includes the construction of a roller-compacted concrete(RCC) gravity dam on the Steelpoort river, en route from Stoffberg toSteelpoort, near the existing provincial road (the R555), of which a 20 kmportion has been realigned. The dam wall is being built downstream fromconfluence of the Steelpoort and Klip rivers, the latter being a tributary

joining from the eastern side.

Phases 2B to 2G will entail the construction of a bulk distribution systemto be funded and implemented by the TCTA.

The ORWRDP-2 is consequently a multipurpose project, incorporating

economic and social development objectives to cater for the water demandsof commercial and social users.

The project will consist of more than 200 km of pipelines that will varyin diameter from 800 mm to 1 800 mm, several pumpstations and storagereservoirs.

ValueThe estimated cost for Phase 2A stands at R3.1-billion, of whichR2.1-billion was spent in the 2010/11 financial year, and R926-millionwill be spent during the next three years. The bulk distribution network isultimately estimated at R13-billion.

DurationThe construction of the De Hoop dam started in July 2007, and wasinitially expected to be completed in April 2011; however, owing to the

construction challenges, the dam will now be completed in April 2013.The first construction contract of the bulk distribution system started inearly 2012, and will be completed by the end of 2013.

Further phases will be packaged into future contracts, with the last contractlikely to be completed as late as 2017.

Latest DevelopmentsConstruction activities for the R1.2-billion Phase 2C and Phase 2H of theORWRDP are currently being undertaken by construction group Basil

Read, which entails the construction of 40 km of welded steel pipelinevarying in diameter from 1 300 mm to 1 800 mm, with wall thicknesses obetween 5 mm and 14 mm.

Basil Read was awarded the contract in February this year. Implementationstarted in April and will take 21 months to complete.

Upon completion, the pipeline will deliver 49-million cubic metres owater a year.

Another part of the contract is the construction of the Steelpoorpumpstation, which includes electrical, hydromechanical andinstrumentation works with a capacity to deliver 2 m3/s of water.

The project scope includes major earthworks, pipe installations andwelding, road and river crossings, as well as pipeline chambers andappurtenant works.

The R600-million Phase 2D, which will involve the construction of 25 kmof pipeline, using 1 100 mm welded steel piping, as well as the constructionof a terminal reservoir, is expected to be awarded within the next fewmonths.

Key Contracts and Suppliers

For Phase 2A, De Hoop

Main Road Contractor (realignment of the R555 road):

Hillary, Liviero & Eigenbau (HLE) joint venture [JV] (main contractor).

Main Civil Contractor (De Hoop dam): De Hoop Construction West andsubcontractors B&E International and Quanza JV (supply of fine andcourse aggregate, crusher run and rip-rap); Limpopo RR & Construction(drilling and blasting); Regray Security (site security); SA Rock Drills(drilling and grouting of dam foundations); Drakensburg Technologie(supply of standard formwork); Formscaff (supply of special formwork)Allied Plant and Hire (erection of RCC conveyor system); SA French(erection of tower crane); NSI (commissioning and maintenance of batchplants); Twin Cities (supply of cement); Dura Pozz Bulk (supply of fly ash)BASF (supply of cement additives); and Steeledale Reinforcing (supply andfixing of reinforcement).

For TCTA, the status of key contracts is as follows:

The Aurecon Ndodana JV was awarded the design and supervision contracin 2009, following an open tender process. Basil Read was awarded theconstruction contract for Phase 2C and Phase 2H in February 2012.

On Budget and on Time?As the De Hoop dam study area is an ecologically sensitive region, it requiredextensive environmental investigations before a record of decision waissued by the former Department of Environmental Affairs and Tourism(now the Department of Environmental Affairs) on November 21, 2005This was revised on October 16, 2006, following resolution of appeals.

Contact Details for Project InformationDWA media liaison officer Linda Page, tel +27 12 336 8250,fax +27 12 336 6592 or email [email protected].

De Hoop Dam project manager Richard Martin, tel +27 12 336 8072;

De Hoop Dam contractors representative, Johan van Niekerk,tel +27 13 260 1110/1111, fax +27 13 260 1356 oremail [email protected].

TCTA, tel +27 12 683 1200, fax +27 12 683 1300 or email [email protected];or head of communications Thandi Mapukata, tel +27 12 683 1294 oremail [email protected].

HLE JV, Ed Hillary, tel +27 15 293 1221.

Water



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MINING PROJECTS

Coal

Diamonds

Gold

Iron-Ore

Other Mining Sectors

Platinum



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The coal-mining industry is of major signicance to the South African economy. Inaddition to coal being one of the countrys leading mineral revenue generators,it is also the source of about 93% of the countrys electricity, 70% of its primaryenergy and 30% of its petroleum liquid fuels.

For instance, Exxaro Resources Grootegeluk Medupi expansion project, inLimpopo, is part of the 40-year coal supply agreement, at an average of14.6-million tons a year, that Exxaro secured with State-owned utility Eskom tosupply the utilitys new Medupi power station, near Lephalale, which is currentlyunder construction.

Also in Limpopo is Resource Generations Boikarabelo project, which will produceabout three-million tons of coal for the export market and three-million tons forthe domestic market.

On South Africas border, Mozambique is experiencing a coal growth spurt.Major global mining companies, such as Rio Tinto, are developing signicantcoking coal export projects, which will make Mozambique one of the worldsbiggest coal exporters. Some of the proposed new mines include Rio TintosBenga and Zambeze coal projects, as well as Beacon Hill Resources MinasMoatize project.

Coal



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BEACON HILL RESOURCES MINAS

MOATIZE COAL PROJECT

Name and LocationMinas Moatize coal expansion project, Tete, Mozambique.

ClientBeacon Hill Resources, through its subsidiary, Minas Moatize.

Project DescriptionThe project entails the expansion of the existing openpit rather than agreenfield development.

The project proposes to develop a large-scale openpit mine, which willextract and process about four-million tons a year of run-of-mine (RoM)coal at steady-state production and be capable of producing 2.2-milliontons of saleable coal a year over 11.5 years, 30% of which will be cokingcoal.

The Minas Moatize expansion will be undertaken in three phases. Theexpansion is currently in its first phase, with the existing wash plantoperating at 600 000 t/y (Phase 1 of the coal handling and preparationplant, or CHPP); however, an additional two phases will be undertakenduring the next 30 months.

Phase 2 will involve the expansion of the current wash plant and willinclude the expansion of the Phase 1 CHPP, increasing production to1.8-million tons a year RoM.

Phase 3 will take production to four-million tons a year RoM and willinvolve the commissioning of the new life-of-mine wash plant.

Value

The total project capital estimate is $166-million, including $42-millionfor engineering, procurement and construction management, as well as

contingency and other indirect costs.However, this figure could be reduced to $18-million, should Beacon Hillfinance key infrastructure items, such as the CHPP; the power station,

through a build, own and operate arrangement; as well as use a miningcontractor to mine the pit.

DurationPhase 1 of the openpit operation is currently in progress.

Beacon Hill has recently started the Phase 2 expansion.

Phase 3 is expected to be commissioned by mid-2014.

Latest DevelopmentsBeacon Hill has reported that optimisation continues on the expansion oits Moatize mine.

The company has indicated that existing trucking operations will bsufficient to transport Phase 2 production, but that the start of Phase 3 isubject to certain key milestones, including rail allocation, the finalisationof the design of the Phase 3 CHPP, and financing.

A definitive feasibility study, published in February, identified several areawhere additional investigation could lead to further optimisation of thedesign and construction of the Phase 3 CHPP.

Beacon Hill has stated that the optimisation of the final design of the Phas3 CHPP is focused on identifying the optimum liberation size and designof the fines circuit. The liberation, flotation and filtration tests on thlarge-diameter cores will investigate these properties to upgrade the overalquality of the coking coal and coking coal yield that will be achieved fromthe Phase 3 CHPP.

Key Contracts and SuppliersGlobal Coke (offtake agreement); Tayanna Mozambique (excavation andcoal extraction works) and Vitol Coal SA (marketing agreement).

On Budget and on Time?Yes.

Contact Details for Project InformationBeacon Hill Resources executive chairperson Justin Lewis,tel +61 3 96279910 or email [email protected].

Coal



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EXXARO RESOURCES GROOTEGELUK

MEDUPI EXPANSION PROJECT

Name and LocationGrootegeluk Medupi expansion project (GMEP), Limpopo, South Africa.

ClientExxaro Resources.

Project DescriptionThe project entails a brownfield expansion of Exxaros Grootegeluk mine.Coal will be mined from the existing openpit at an accelerated rate, withthe mines current production increasing from 19-million sales tons a yearto 34-million sales tons a year.

The expansion is part of the 40-year coal supply agreement, at an averageof 14.6-million tons a year, that Exxaro secured with Eskom to supplythe utilitys new Medupi power station, which is under construction nearLephalale, Limpopo.

ValueThe project will cost R9.5-billion. Building of employees housing unitswill cost R590-million.

DurationFull coal production is expected from 2015.

Latest DevelopmentsThe first coal, based on a revised ramp-up schedule agreed with Eskomhas already been delivered to Eskom. In terms of the revised agreement,160 000 t of coal will be delivered during 2012 for the commissioning ofthe respective coal handling systems, while the coal ramp-up will startduring March 2013 and continue until mid-2016.

Under the initial agreement, signed in September 2008, Exxaro Coal

Documents

41856 Pip - September 2012 (Second Edition)