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Kumba awards R2bn drilling contract to Rosond

Anglo American-owned firm grants tender as part of initiative to ‘modernise geoscience operations and extend life of mines’

Family-owned Rosond, a decades-old drilling company, has secured a R2bn contract with Kumba Iron Ore, displacing the larger, JSE-listed company Master Drilling at one of its key SA contracts.

Kumba, which is 70% owned by Anglo American, granted the contract over both its mines in the Northern Cape to Rosond, replacing Master Drilling and Geoserve Exploration Drilling, said Rosond MD Ricardo Ribeiro in an interview.

Kumba had three large brownfield exploration drilling contracts with three companies, one at each of its two mines and a greenfields exploration drilling programme, which Rosond had started in 2012.

“All the work went out to tender last year. Clearly, we ticked all the boxes for Kumba and Anglo and they awarded us the entire contract,” Ribeiro said.

“It’s a lot of greenfield and brownfield exploration work and grade-control drilling in the pits of the two mines,” he said, adding the new rigs and technology would improve operational efficiencies by between 30% and 50%.

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It is the second large contract Rosond has won with an Anglo subsidiary, having recently signed a R500m contract with Debswana in Botswana. Debswana is a diamond mining company equally shared between that country’s government and De Beers, an 85%-held Anglo company.

The contract was awarded to Rosond as part of a Kumba initiative to “modernise its geoscience operations, and extend the life-of-mine of Kolomela and Sishen mines, to elevate safety standards, and improve productivity”, said Kumba CEO Themba Mkhwanazi.

Rosond, which has more than 60 years of drilling experience, has been a long-term client of Anglo over four decades and Ribeiro said he hopes the work done under the new Kumba contract with state-of-the-art drill rigs will lead to offshore contracts with the company too.

Rosond will do greenfield and brownfield exploration and resource definition drilling at the Sishen and Kolomela mines. The Midrand-based business will deploy 30 high-tech rigs to the two mines during 2020, said Ribeiro.

The initial cost to Rosond would be R300m, but the drill rigs, which are imported from an overseas manufacturer using the technology combinations and ideas Rosond’s research and development department devised, will need to be equipped and staffed, he said, adding the cost would be considerably higher.

“Nothing that we’ve done on these rigs is revolutionary, but we’ve packaged various things into these drills. We took all our knowledge and the best methodologies from around the globe to come up with what we believe is a winning solution for us and our client,” Ribeiro said.

Master Drilling, which prides itself on its technological advances in drilling, declined to comment on losing one of its contracts in SA.

The new Rosond rigs are fully automated and will be controlled from an air-conditioned cabin far behind the machines, with no fewer than three people allocated to each rig, Ribeiro said.

The automation of the rigs would allow women crews on the rigs, one of the objectives Rosond had set itself for this contract.

Another aspect of the deal was “carving off” a section of the R2bn deal and starting a small drilling company in the Northern Cape, passing on skills, Ribeiro said.

“The partnership sets a new standard in terms of our objective to advance local and host community businesses to the industry that is built off a strong technology advancement platform,” said Mkhwanazi.