investor site visit - the vault investor site visit ... experience the most modern cement operation...

Investor Site Visit

Dwaalboom Factory

8 September 2009

2

Welcome

Introduction

Programme• 09h30 Presentation • 11h00 Q & A• 11h20 Safety induction• 11h30 Site tour• 13h00 Q & A• 13h30 Lunch• 14h30 Departure

3

Objectives

Objectives for today

• Investors experience the most modern cement operation in southern Africa see first hand PPC’s capital expansions (past & future) meet a wider group of PPC’s senior management and operational staff

• PPCdemonstrate what we are proud & capable of constructing & operatingmeet and interact with a very important stakeholder group

4

’

Orientation

RiebeeckDe Hoek

Port Elizabeth

HerculesJupiter

Dwaalboom

Colleen BawnBulawayo

Gaborone

Slurry

Zimbabwe

Botswana

Moz

ambi

que

Namibia

Saldanha

PPC Cement Sites

5

’

Orientation

RiebeeckDe Hoek

Port Elizabeth

HerculesJupiter

Dwaalboom


Gaborone

Slurry

Zimbabwe

Botswana

Moz

ambi

que

NamibiaBotswana

Limpopo

North West

Medupi Power Station Polokwane

Pretoria

Dwaalboom

Slurry

Gaborone Mill

Sun City

Hercules

Jupiter

Gauteng

Rail

320kmRail

250km

Road

22

0km

Johannesburg

Thabazimbi

6

Orientation

7

’

Southern Africa Cement Industry

RiebeeckDe Hoek

Port Elizabeth

Lichtenburg

DudfieldHercules

Jupiter

Ulco

Dwaalboom

Simuma

Colleen Bawn

Bulawayo (Mill)

Gaborone (Mill)

Slurry

Industry Capacity 2010/11*

7.4mt4.2mt3.1mt

1.5mt3rd Party Extenders 1.3mt

Total 17.5mt

* Note:PPC estimate (assuming no kiln retirements)Excludes capacities of PPC Zimbabwe (~750kt)Lafarge ZimbabweCimpor Mozambique

Zimbabwe

Botswana

Moz

ambi

que

Durban (Mill)

Mills

Saldanha (Mill)

Matola

Harare

8

10

12

14

16

18

20

22

2006 2007 2008 2009 2010 2011

Regional Supply and Demand

Mt

Growth 7.4% -3.9% -10%? 0%? 6%?

Industry demandIndustry maximum capacity

PPC 1.25Mt/yr, Cimpor 0.6Mt/Yr: (2009)

Lafarge 1Mt/yr PPC Mill 0.3Mt/yr, Afrisam Mill 0.4Mt/yr (2010)

Contracted / Building

CompletedImports

Revision: August 2009

9

Dwaalboom

10

Introduction

1908, a Surveyor, Mr Muhl, got lost and overnighted in a marula tree. Called it ‘ Verdwaalboom’…

Rainfall: 350-650mm per annum

Temp: -2 deg – 44 deg C. Ave 21 deg C

Coordinates: 24° 43' 0" South, 26° 49' 0" East

Industry: Farming, mining, tourism

11

Overview

Dwaalboom cement manufacturing plant located in Limpopo Province

Newest plant within PPC Group

Produce OPC and Surebuild cement

Limestone, shale and lava mined at quarry adjacent to factory

Iron ore and coal brought in

235 permanent employees

ISO 9001, ISO 14001, OHSAS 18001,

SANS 1841 and AMS 16001

12

Overview

Dwaalboom mining property covers 13 000 ha; reserves > 100 years

Kiln 1 commissioned 1985; mothballed soon thereafter due to market downturn

Re-commissioned 1996 along with new cement mill, packaging and dispatch facility

Kiln 2 commissioned Sept 2008

Supplies northern SA, Gauteng region, Botswana & Mozambique.

13

Organisational structure

Operations

Engineering

Mining

Production

Quality Assurance

Packaging & Logistics

Organisational Performance (HR)

Administration

Risk

Environment and Sustainability

14Release Energy/Reward

Clear Purpose

Continuous Performance Improvement

Performance Improvement

(Organisational/Individual)

Learning for Growth

Alignment

Inspiring Climate

Vision Strategy

Communication

Understood

Journey maps

Fairness, order, rules of the gameCommunication, information, influenceManagement styleRecognitionCode of conductRemuneration and benefitsEffective HR administration

Value driversStructureJob model Purpose Scorecard Competencies

CommunicationReviewing progressStretching targetsSolving problemsEducation

Career developmentSkills developmentSuccession planningNQF alignment

Role and function clarity

Accountability

Scorecards, targets & action plans

Performance measurement

Performance reviews

Recognition Action plans for

under performance

Structure/Harness EnergyCreate Energy Direct/Focus Energy

Invocom®

Passionate People: Vital Elements of a Performing Organisation

15

Corporate Social Investment

Social and Labour Plan submitted

MOA local municipality – agricultural feedlot (R5m)

Supplied government pension pay-out centre (R500,000)

Support for several local care centres

Dwaalboom-Koedoeskop road surfacing project (R60m PPP*)(* Public Private Partnership)

16

Geology

17

Geology

Formation of calcrete

18

Mining

Mine

Factory

Crushing

19

Mining

Large calcrete deposit is exploited as major component in cement manufacture

Shale and lava deposit exploited for correcting silica and aluminium

Iron obtained from by-products of local iron ore mine or from magnetite

Shallow open cast mine:• Q1, Q2: limestone @ <15m• Q3: shale / lava @ <40m

20

Cement manufacturing

21

Cement manufacturing process

crushing plant limestone blending coal stockpile

coal mill

raw mill

cement milling & dispatchpre-heater, kiln line & cooler

mining limestone

clinker storage

22


coal mill

raw mill


mining limestone

clinker storage


coal mill

raw mill


mining limestone

clinker storage

Cement manufacturing - detail

23


coal mill

raw mill


mining limestone

clinker storage


coal mill

raw mill


mining limestone

clinker storage


24


coal mill

raw mill


mining limestone

clinker storage


coal mill

raw mill


mining limestone

clinker storage


25


coal mill

raw mill


mining limestone

clinker storage


coal mill

raw mill


mining limestone

clinker storage


26


coal mill

raw mill


mining limestone

clinker storage


coal mill

raw mill


mining limestone

clinker storage


27


coal mill

raw mill


mining limestone

clinker storage


coal mill

raw mill


mining limestone

clinker storage


28

Products

Clinker• Onsite manufacture of cement• Dispatched to Hercules and Jupiter for cement manufacture

Cement• CEM I 42.5N (OPC*)• CEM II 32.5R (Surebuild)

* Ordinary Portland Cement

29

The heart of the operation : The kilns

Kiln 1 (DK1)• 5 stage suspension pre-heater kiln• ~750kt/annum of clinker• supplied by FL Smidth

Kiln 2 (DK2)• 6 stage in line calciner, low NOx kiln• ~1mt/annum of clinker• supplied by FL Smidth

DK 2

30

DK2: world class

Main plant – 7 700 t machinery

Total plant – 2 500 t structural steel

Total plant – 39 900 m3 concrete

Total plant – 318 km electrical cable

Installed power: 10MW • (Raw Mill, Coal Mill and kiln only)

Investment: R1 400 million (2008)

31

DK2: world class

Contractors on site peaked at 1500• Local labour contingent averaged ± 30%

• 800 benefitted from formal on the job training

• 650 housed in R24m contractor camp

• Every person onsite received a lunch

7 lost time injuries in 5.5million man hours• Most severe was fractured arm

• Formal safety training for every person

640 containers and bundles shipped to site

32

DK2: world class

‘Flame-in’ 26 September 08 First clinker is produced!

33

DK2: world class energy efficiency

DK1

Thermal3.5 MJ/kg clinker

ElectricalRM - 22 kWh/tonKiln - 49 kWh/ton

DK2


ElectricalRM - 14 kWh/tonKiln - 35 kWh/ton

JK3*


ElectricalRM# - 34 kWh/tonKiln - 35 kWh/ton

Total operational cost reduction of DK2 vs DK1 ~20-30% on R/ton basis

* Jupiter Kiln 3# Raw mill

34

DK2: Word class emissions

Cementmanufacturing

Reduced through in-line calciner technologyNOx

Reduced through electrostatic precipitator, bag filter (Emissions within European standards)

Dust

35% unavoidable (CaCO3 – CaO + CO2)CO2 Reduced through efficient fuel use

35

QUALITY

ISO 9001C&CI ‘zero findings’

ENVIRONMENT

ISO 14001Wildlife protectionInternalisation of process wasteConcurrent rehabilitationRecycling of all domestic wasteEMP: Water,

Ecology, Rehabilitation

Continuous improvementInternal audit (excellent rating)JAP auditSANS 1841

HEALTH / SAFETY

OSHAS 18001AMS 16001Dekra 5 Shield

OTHERMaintenance Optimisation Programme (MOP)Transformation strategy

World class management systems

CORPORATE GOVERNANCE

36

Hercules

Established 1892

• Opened by Paul Kruger

• Beginning of PPC

Location – Pretoria

235 employees

Existing plant

• 2 kiln lines

• 3 cement mills

37

’

Hercules Orientation

RiebeeckDe Hoek

Port Elizabeth

HerculesJupiter

Dwaalboom


Gaborone

Slurry

Zimbabwe

Botswana

Moz

ambi

que

NamibiaBotswana

Limpopo

North West

Medupi Power Station Polokwane

ThabazimbiDwaalboom

Slurry

Gaborone Mill

Sun City

Hercules

Jupiter

Gauteng

Rail

320kmRail

250km

Road

22

0km

38

Ntšhafatso (“Re-birth”) – New Mill Project

Why Hercules?• Increases flexibility and shorter delivery to key market

• Ideally located to cement extenders (slag & ash sources)• Need for capacity replacement, expansion and product flexibility

New 1mt/annum Vertical Roller Mill (VRM)• Latest proven milling technology

• Approximately 30% less power consumption

• Able to produce a wider range of extended cements (CEM IV & V) reduces energy consumption & CO2 emissions per ton of cement

• 30% of capacity is for replacement of 2 existing mills

39

Loesche Vertical Roller Mill

New materials handling and storage

New automated quality control system

Upgrade of plant’s electricity supply • Municipal substation erected by PPC

Total plant – Concrete 15000m3

• Geology required extensive piling

Investment - R700million(2009)

Ntšhafatso: Overview

40

Ntšhafatso: Efficiency

Existing Mill 1

Output15 t/h

Electrical65 kWh/ton

Existing Mill 2

Output20 t/h


New VRM Mill*

Output120 t/h


Figures are based on milling OPC (CEM I) only

* Figures based on contractual performance guarantees

41

Ntšhafatso: Project Status

Project progress 80%

Commissioning early 2010

Operational Readiness in parallel• Training in progress at Dwaalboom

Contractors employed to date - 1200• 600 contractors on site at the peak

Safety• 1.4million man hours worked without a lost

time injury• Site congestion a significant challenge

42

Ntšhafatso: Environmental Considerations

Clinker handlingTransport and silo

New dual cement siloand

Bulk dispatch

LaboratoryAutomation VRM

Dust freetransportsystem

43

Thank you

44

Dwaalboom Site Visit

Annexures: Other PPC Sites

45

Manufacturing sites: De Hoek

Established 1921

260 employees

Manufactures clinker and cement

46

Manufacturing sites: Jupiter

Established: 1934

150 employees


47

Manufacturing sites: Port Elizabeth

Established 1928

165 employees


48

Manufacturing sites: Riebeeck

Established 1960

180 employees


49

Manufacturing sites: Slurry

Established 1915

250 employees


50

Manufacturing sites: Zimbabwe

Acquired in 2001

533 employees


51

Manufacturing sites: Botswana

Established 1995

155 employees

Cement milling

52

Manufacturing sites: Saldanha

Established 1997

40 employees

Materials handling and slag milling

53

Aggregate quarries: Mooiplaas / Laezonia/ Kgale

150 employees

Supplies construction aggregates and metallurgical stone

54

Manufacturing sites: Lime Acres

Established 1955

330 employees

Supplies lime stone and burnt lime products

55

Disclaimer

This document including, without limitation, those statements concerning the demand outlook, PPC’s expansion projects and its capital resources and expenditure, contain certain forward-looking views. By their nature, forward-looking statements involve risk and uncertainty and although PPC believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Accordingly, results could differ materially from those set out in the forward-looking statements as a result of, among other factors, changes in economic and market conditions, success of business and operating initiatives, changes in the regulatory environment and other government action and business and operational risk management.

While PPC takes reasonable care to ensure the accuracy of the information presented, PPC accepts no responsibility for any consequential, indirect, special or incidental damages, whether foreseeable or unforeseeable, based on claims arising out of misrepresentation or negligence arising in connection with a forward-looking statement. This document is not intended to contain any profit forecasts or profit estimates, and the information published in this document is unaudited.

investor site visit - the vault investor site visit ... experience the most modern cement operation...

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