Evraz Highveld Steel Vanadium (Appendix A)

EUROASIA INDUSTRY 117

Evraz Highveld Steel and VanadiumLimited (Evraz Highveld) has come a longway in the past 50 years, developing its ironore and vanadium mining assets into anintegrated mining, processing and mar-keting operation, with sales throughoutSouth Africa and in export markets.

In 2006, Evraz, the Russian metallurgicalgiant, and Credit Suisse, purchased AngloAmerican plc’s 24.9 percent share inHighveld. In 2007, Evraz exercised itsoption to acquire the share capital held byCredit Suisse as well as the share capital stillheld by Anglo American. In February 2008,the transaction was completed fully.

Singular processesEvraz Highveld employs in the region of2,300 people with wide-ranging expertise.As a fully vertically integrated steel company– running its own mining, processing andsales operations – Evraz Highveld directlyemploys a range of specialist engineers.“The key is to have appropriately skilledand qualified people in all of the variousstages of our production process, which iswhy we spend a lot of time on training toenable us to maintain the right balance ofskills. Finding, attracting and retainingthe right numbers of skilled people is achallenge in South Africa, and a lot of

other countries today, hence we put a lotof time and effort into that.”

One factor that makes Evraz Highveldlargely unique is its integrated operations.The process starts at the Mapochs mine,where Evraz Highveld mines iron ore, whichis then transported directly to itsSteelworks for processing into steel.During the steel making process the com-pany also extracts vanadium slag which issold to be processed into ferro-vanadium.“At the moment, the Mapochs mine isfully owned by Evraz Highveld,” MrMacDonald explains. “However, theintention is for the facility to feed into a

SETTING STANDARDSFOR THE FUTUREEvraz Highveld Steel and Vanadium Limited celebrates its 50th anniversary this year,having been established in 1960. Eric Payne talks to the company’s new Chief ExecutiveOfficer, Mr Scott MacDonald, about its unique production processes and plans forfuture development.

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116 EUROASIA INDUSTRY

EUROASIA INDUSTRY 119118 EUROASIA INDUSTRY

STERLINGSTERLING

LABOUR HIRELABOUR HIREREG NO: 2000/030940/23 VAT NO: 4480191917

3 Tungsten RoadP.O.Box 2254

WITBANK 1035Tel: 013-656 1089 / 1924

Fax: 013 656 3249

To ensure our Clients receive services of required standard and backing them upwith quality, and services they themselves offer their clients.

We strive to be available to our clients at all times, thus easing extreme pressure,by quick response, commitment and a guaranteed high standard of workmanship.

To Provide our customers with the assurance that products and services rendered bySterling Labour Hire, will meet agreed specifications and performance requirement....

1. Mechanical Fabrication2. Labour Hire3. Equipment Hire4. On-Site Fabrication5. Structural Steel Erection6. GRP - Pipe / Steel Pipe Work7. General Plant Work & Maint.8. Shut - Down work9. Clading of buildings {Sheeting}

Contact Details: (tel) 013-6561089 / 1924 (fax) 013-656 3249Email: [email protected]; [email protected]; [email protected]

No 3 Tungsten Rd, Industrial Area, Witbank 1035, Mpumalanga, South AfricaPo Box 2254, Witbank 1035.

Members: N.W. Mckensie, A.D Sandenbergh

Mission Statement


BEE (Black Economic Empowerment)transaction later in 2010. In April 2009we concluded an agreement to transfer 26percent of the ordinary equity interest inMapochs to local partners. The transac-tion is subject to certain conditions andnow we are waiting for the approval of theregulator that will be given in due course”.

Today, the Mapochs mine is basicallyopen cast; most of the ore is on the sur-

face, making it relatively easy to extract.The mine is located roughly 130 kilometresfrom Evraz Highveld’s processing facilityand material is shipped directly betweenthe two via rail. “The steel makingprocess itself, however, is quite unique,”Mr MacDonald emphasises. “Unique inthe sense that the ore that we extract is amagnetite ore with high levels of titaniumin it. There are very few other facilities

around the world that mine and processthis ore. As such, when this company wasestablished, some very clever peopledeveloped a specific process for workingwith that ore, which is unique to EvrazHighveld. New Zealand Steel has a sim-ilar process, but even that is not exactlythe same.”

The iron making process involvesbringing iron ore into the plant, transfer-�

Silicon Smelters (Pty) Ltd. Byersnek Road, Polokwane. Tel: +27 15 290 3000 Web: www.ferroatlantica.es/ferropem/html/english/polokwane.html

Silicon Smelters (Pty) Ltd, located in South Africa, is part ofthe FerroAtlantica Group, an international ferroalloy producerwith its head office in Spain. The core activity of Silicon Smelters(Pty) Ltd is the production of Ferrosilicon in its Rand Carbide plantlocated in Witbank, and the production of high-grade siliconin the Polokwane plant.

The following products are produced and sold on the local andinternational markets:• Silicon: for the aluminum, chemical and specialized markets• Ferrosilicon: For steel and foundry markets• Silica Fume: For the construction industry• Söderberg electrode paste: For electric arc furnace applications

In addition to the ferroalloy plants, Silicon Smelters (Pty) Ltd is also ashareholder in Thaba Chueu mining, a South African BEE companyspecializing in silica mining in South Africa.

ring into openslagbath furnaces. Theliquid iron is transferred to the Steel plantto produce steel. The steel is casted intoslabs, blooms or billets at the continuouscaster. The slabs are transported to theflat products mill for rolling into flatproducts. The blooms are transported tothe structural mill for rolling into struc-tural products and the billets are sold asfinal products.”

Sales avenuesIn terms of its production levels, at themoment, the company is working at around95 percent capacity, which it intends tocontinue doing for the remainder of 2010.“Our core market is obviously South Africa;75 percent of our output is sold to thedomestic market,” he affirms. “In terms ofsectors, like in many other markets aroundthe world, the biggest sector is construc-

tion – and we have a particular focus onproducing heavy sections.

“There are two major steel companiesin South Africa – ArcelorMittal and EvrazHighveld Steel and Vanadium Limited.However, we are the only company in SouthAfrica that manufactures steel sections, andclearly one of the biggest consumers of sec-tions is the construction sector. The othermajor sector that we focus on in South �



WE ASSURE YOU OF OUR BEST SERVICE AND ATTENTION AT ALL TIMES AND HOPE TO BE OF SERVICE TO YOU.

Our Workshop is situated at Plot 105, Section 292, Kromdraai, Witbank The Workshop is fitted

with overhead Cranes and we are completely safety equipped. We are registered with MERSETA

(Manufacturing, Engineering and Related Services Seta) in order to assist in Apprentice training

for our future Artisans.

PURPOSE

Our main purpose is to assist in repairs of Earthmoving machinery like, i.e.: Dozers, Loaders, Excavators,

Dumpers, and Motor Graders, etc. That means we are able to assist the remanufacturing of Com-

ponents, like:-

Engines, Transmissions, Hydraulic systems (Valves, Safety Valves, Obetrols, Control & Demand

Valves) and around Machines.

To strip down Machine and overhaul components and re-assemble machines. We offer a very com-

petent labour rate and are available 24 hours were needed.

MACHINES FOR HIRE:

Komatsu W320-3 Front End Loader - 16 Ton /2,4 c/m3 Bucket, Hitachi w 170 Front End Loader, 30

Ton Excavator, Komatsu D85/18 Dozer – 30 Ton operating weight / 7,2c/m3 Blade, Fiat Allis Dozer.

SAFETY HEALHT ENVIROMENTAL SYSTEMS (SHE)

Our Company believes in the right of the individual employee to work in a physically and mentally

safe environment. We therefore consider safety as one of the highest priorities in any project. In

order to meet our Health and Safety obligations we comply with the Mine Health and Safety Act

1996 and Mineral Act 1991 as well as the OHS Act 85 of 1993 and the Construction Regulations

of 2003

We have implemented the Advantage ACT Implex Safety compliance system on all our sites We

conform to IS0 14000 Environmental regulations and procedures. We trust that this information

will be useful to you and we do look forward to receiving future inquiries. Should you have any

queries, please do not hesitate to contact us.

P.O.Box 8034, Die Heuwel, Witbank 1042 - Tel: (013) 652 8116 • Fax: (013) 652 8118 • Email: emovingmweb.co.za

EARTHMOVING MECHANISMS were established during 1991 to supply a much needed service to the Industrial and

Mining Sectors. Our Company has a field service team to carry out maintenance, repairs, fault finding and servicing.

We also offer parts at reasonable prices. Our Company is currently on the list of several registered Companies and is

registered as a B.E.E. Company.


Africa is mining. As you will be morethan aware, the FIFA 2010 World Cupwas hosted by South Africa earlier thisyear, and a lot of stadiums were built inpreparation. Stadiums require a lot ofsections, so we have been doing very goodbusiness supplying those. Post-World Cup,we are starting to see signs that the generaleconomy in South Africa is beginning toimprove. There is still a long way to go, butthe signs are that there is real underlyingimprovement in demand.”

“Evraz Highveld specializes in twoproduct areas, steel products, which aremainly sold through service centres inSouth Africa – Macsteel Service CentresSA, which is part of an internationalgroup, being one of the largest; and vana-dium, which the company produces asslag and supplies to Austria.

Naturally, the company also targets spe-cific projects, when they are well suited towhat Evraz Highveld is able to supply. “Wefollow all of the major contracts issued in

South Africa, which are then followed upon by our sales people. For instance, Eskomrecently received a World Bank loan forUS$3.75 billion, to build a new coal-firedpower plant, and we will certainly belooking to link into the steel supply,” Mr MacDonald confirms.

Technical complianceAs a vertically integrated company, EvrazHighveld can leverage significant advantagesover other steel companies in terms of how �



it manages supply and demand. “Othersteel companies are looking to become morevertically integrated, whereas we are already.This, combined with our two productstreams – steel and vanadium – gives us asignificant competitive advantage,” MrMacDonald attests. “The third competi-tive advantage I would list is that we are aJSE-listed company with a major share-holder in the form of Evraz, the global steelcompany, which holds just over an 85 per-cent stake in Evraz Highveld. As such, if

we want to increase our presence in exportmarkets, Evraz already has a global foot-print that we can take advantage of.”

In terms of quality control, EvrazHighveld is ISO 9001 approved by theGerman regulatory body, TUV. The com-pany is also very safety focussed and willbe even more so under Mr MacDonald’sleadership. “I started working here on 1stMarch 2010, and one of my top prioritiesfor the company is an even greater focus onsafety. One of the programmes that we run

inside of the company is called H0TT0, orEvraz Highveld Zero Tolerance Target Zero.This is the banner under which all of ourposters, initiatives and safety rules are set.”

As far as Mr MacDonald is concerned,the best way to improve and maintain highsafety standards is by demonstrating itthrough leadership: “All of the people onthe management team have to demonstratethat health and safety is a key prioritythrough their actions. The two things thatI have already said to people here is, be chal-�


DE JAGER ENGINEERING ccFabrication - Erection - Machining and Palisades

Bertus: 082 808 6402

Office No: Address:

Tel No: (013) 659 7128 P.O.Box 1212 Keerom Str 3

Tel No: (013) 659 7097 Witbank Clewer

Cell No: 082 896 6056 1035

Fax No: (013) 659 7103 Email: [email protected]

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demand improving? I’m not so sure at thisstage. Whereas in South Africa, thereare signs that real underlying demand isimproving and that the market has slowlystarted moving in the right direction.

“Finally, in the past, we have not beenparticularly communicative with investorson the JSE. This is going to change,” “MrMacDonald announces. “As of March 2010,we have embarked on a series of road showswhere we speak with investors, and this hasgone down extremely well. The feedbackwe received has been positive and we aremore conscious than ever of the fact that,as a public company, we have got to be alot more open than we have been in thepast. Indeed, the company publicly cele-brated its 50th anniversary on 19th May 2010.” �

Mr Scott MacDonaldChief Executive Officer


lenged and challenge. If you see someonecarrying out an unsafe practice, challengethem. Having already raised this with theunions on site, the response has beenextremely positive. But, as I said to them,it is equally important that their membersact accordingly and do not become com-placent on site. Our ultimate objective iszero accidents.”

Likewise, the environment is one of the company’s “top focuses”, as Mr MacDonald describes it. “At themoment, we are in the process of estab-lishing a five-year plan for environmentaldevelopment, which will certainly involvesome form of capital expenditure. Like inmany other countries around the world,the environment is right at the top of theagenda in South Africa, and we have reg-

ular liaisons with government depart-ments to get their input and listen to their suggestions”.

Future prioritiesLooking to the future, the company’s toppriority is to identify areas where it canimprove efficiencies and reduce waste in itsmanufacturing processes. “We will belooking at the entire supply chain, fromwhen we extract ore out of the ground towhen we deliver a finished product to acustomer, in order to make what we do assimple as possible,” Mr MacDonald attests.

“Environmental issues are another highpriority which we have just covered, andlooking to the slightly longer term, we willbe looking to establish some kind of co-gen-eration facility. Much like in many other

countries around the world at the moment,electricity prices are increasing quite dra-matically. We have started the initial eval-uation and, two or three years down theline, we expect to be developing someform of co-generation project.

“Another key driver for our future will bea focus on customers,” he continues. “Atthe end of the day, we have to meet customerexpectations and address needs within sec-tors as the markets develop. In that sense,getting closer to our customers is going to bevery important. By way of summary, better,faster, smarter are the three words I woulduse to describe what we are doing here.

“In terms of the market itself, we are cau-tiously optimistic. To draw a comparison,when I look at the UK, which is where I amfrom, I see re-stocking, but is underlying

Evraz Highveld Steel Vanadium (Appendix A)

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Transcript of Evraz Highveld Steel Vanadium (Appendix A)